Warren Buffett makes me sick.  And not for the reason you are probably thinking.  It doesn’t make me sick that he his ridiculously good stock prowess made him one of the top investors and richest men in America.  No, that actually makes me cheer him, its his socialist views and attempts at promoting socialism in the country while having made his fortune off of our system that make him an evil person.   I mean evil in the Ayn Rand speak sort of evil.  I recently heard an interview with him and it was enough to make me sick.  He railed against free markets, our government, and free trade.  Today I am going to focus on what the focus of the interview was: estate tax.

A little background for those not familiar with the estate tax.  When you die, everything you owned at death is tallied up, life insurance proceeds are added, and that sum is called your estate.  Your estate is everything you are leaving behind.  Under current law, if your estate is more than $2 million, the federal government imposes a tax on the amount that exceeds the magic $2 million mark.  The tax rate goes up to nearly half.

The death tax is an opportunistic penalty on those who have been successful and accumulated significant assets.  It disproportionately penalizes small business owners and family farmers who often have most of their net worth tied up in those businesses and no liquidity with which heirs can pay the death tax.  Heirs then get to liquidate their parent’s business to pay the tax.  The irony is that those that support estate taxes also tend to be ones that rail against corporate America.

Arguments for the estate tax go like this: in the words of Mr. Buffett “You don’t get to be a quarterback … because your father was a quarter back 20 years ago.”  In other words, without the estate tax, he thinks families who currently control most of the nation’s resources will continue to do so by birthright rather than merit.

Oh except there is one major problem with that.  Most Americans are self made.  Thats right, (According to a study of Federal Reserve data conducted by NYU professor Edward Wolff)  in the nation’s richest 1%, inherited wealth accounted for only 9% of their net worth in 2001, down from 23% in 1989.  Less than 10% of multimillionaires are from inherited money as of 2007.  How Mr Buffett who has been a genius about investing for his adult life can be so ignorant and/or blatantly ungrateful about the freedom he has enjoyed to become wealthy is beyond me.

For the record, the estate tax will not affect me, but it may affect my children someday.  I am not spending my entire adult life accumulating wealth for the government to redistribute it when I die.  That my friends, is socialism.  We are not (supposed to be) a socialist country.   There are plenty of those to move to if you want to.

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