Between Murray and Marx

Andrew Sullivan is a sharp guy whose website is a daily source of solid commentary. Being a senior editor at The New Republic, however, it's inevitable that he write something problematic.

Sullivan's March 19 column on the estate tax is notable for what it appreciates as much as what it prescribes. Consider this splendid fulmination against confiscatory Beltway policies:

The most offensive [tax] – the progressive income tax – penalizes success and work. The better you do for yourself, the more the government punishes you for your efforts. The Social Security tax is almost as bad: The government absconds with your money before you even have a chance to look at it – and then pours it into an investment scheme no sane person would ever choose for herself. But then almost all taxes harm people, drain wealth, encourage inefficiency, and generally drag down the level of human achievement. Think of tariffs, which discourage trade, or sales taxes, which discourage buying and selling. Taxes are still necessary, of course, because, in an imperfect world, government is necessary. But taxes, even many liberals agree, are almost never good in themselves; they almost always substitute bad collective oversight for good personal judgment.

With the exception of the penultimate sentence, these sentiments harmonize with libertarian thought in its most vigorous, Rothbardian form. The trade-deterring effect of protectionism, (Anti)Social (In)Security's exploitative idiocy, the punitive envy underpinning the progressive income tax, the deleterious nature of taxes in general – Sullivan shares common ground with Murray Rothbard in identifying these ills:

  • "Progressive taxation, where each man pays more than proportionately to his income, makes no attempt at neutrality. If the proportional tax embodies a principle destructive to the entire market economy and the monetary economy itself, then the progressive tax does so still more. For the progressive tax penalizes the able and efficient in even greater proportion than their relative ability and efficiency." (Man, Economy, and State)
  • "Tariffs and various forms of import quotas prohibit, partially or totally, geographical competition for various products." (Power and Market)
  • "[T]he Social Security System is the biggest single racket in the entire panoply of welfare-state measures that have been fastened upon us by the New Deal and its successors…The whole system is a vast Ponzi scheme, with the difference that Ponzi's notorious swindle at least rested solely on his ability to con his victims, whereas the government swindlers, of course, rely also on a vast apparatus of tax-coercion." ("The Social Security Swindle," in Making Economic Sense.

What a bummer, then, that Sullivan recommends hiking and expanding the estate tax. Instead of the current $675,000 minimum bequest to activate the tax, he would set it at $500,000 and "increase the rates so that anyone bequeathing more than $10 million sees the remainder of his bequest go directly to Uncle Sam or to charity."

Sullivan sees a nexus between intensifying the estate tax and the abolition of primogeniture during the late 1700s. "America's revolutionary abolition of this system helped disperse wealth and discourage the indolence of aristocratic inheritance," he writes.

Justice William Day noted in Buchanan v. Warley (1917), "Property is more than the mere thing which a person owns. It is elementary that it includes the right to acquire, use, and dispose of it." Primogeniture (like its counterpart, entail) was a feudalistic imposition that eliminated a landowner's discretion in disposal of his property. No doubt many landowners would like to pass their property to their eldest son, but others might prefer to pass it to a daughter or someone else.

America's abolition of primogeniture dovetailed with the repudiation of monarchic governance and its patrician badges – hence the constitutional prohibition on titles of nobility. (See Rothbard's "Elimination of Feudalism and the Beginnings of the Abolition of Slavery" in Volume IV of Conceived in Liberty.) John C. Calhoun wrote of the "artificial distinctions" in aristocratic polities, and these were the contrived tiers the colonial secessionists razed.

The estate tax is the obverse of primogeniture, grounded in envy and avarice with the same consequence of assailing property rights. In this case, the State rewards prosperity with demand for tribute, Cosa Nostra style (albeit with authoritative-looking letterhead).

Mindful of John Marshall's observation in McCulloch v. Maryland (1819) that "the power to tax involves the power to destroy," the estate tax and its whopping rates violate the unmolested disposal of one's property – that is, inheritance rights. This reeks of The Communist Manifesto, which logically called for the abolition of inheritance. (I write "logically" because in a regime resentful of human attainment – a communist regime, for instance – institutions such as inheritance that incarnate human attainment must be smashed. George Reisman describes this temperament as "the utterly nihilistic, loot-and-plunder theory."

Sullivan recognizes that estate taxes "break up unified familial property" and "substantially reduce its value," praising this envious aggression as a democratic safeguard against "creeping aristocracy" and "increasing inequality." This fits into his vision for the Right: "Conservatism should be about rewarding work, not inheritance, and encouraging success, not genetic dumb luck."

Although he's no Marxist, Sullivan betrays leftist streaks here. The dig against "genetic dumb luck" has a Rawlsian stench; the caricature of familial property as dynastic incipience mistakes proprietary tradition for the state-compelled caste that defines aristocratic governments.

The absence of an estate tax does not seal off upward mobility for others or reward inheritance over work. Just the opposite, it respects the work that has made inheritance possible and affords individuals the opportunity to bequeath their labor's fruits to their loved ones.

The estate tax had a militarist birth and progressivist revival, a pedigree indicative of its rapacious character. While the majority of Americans do not face the estate tax, preserving this expropriative envy sets a precedent for preying upon the non-affluent. The leap between taxing those with $675,000 bequests and $75,000 or $5,000 bequests is more minuscule than it seems. (Theoretically, any bequest creates an inequality between heirs and non-heirs.)

The Anti-Federalist and Old Republican John Taylor writes in Tyranny Unmasked of "A furious democracy, which invades private property, and scatters it among a multitude." Sullivan's muscularly argued but misguided prescriptions exemplify these words. May his Rothbardian instincts get the better of him.

April 4, 2001

Myles Kantor lives in Boynton Beach, Florida.

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