Where I Stand—Brian Greenspun: ‘Death tax’ redefined

Friday, June 8, 2001 | 5:28 a.m.

Brian Greenspun is editor of the Las Vegas Sun.

EVEN MY mother was laughing ... only because she was afraid not to.

Earlier this week my growing-younger-by-the-day, sweet, dear mother, the woman who gave me life and to whom I owe all that I have -- don't worry, you'll understand this in a minute -- gave me a Paul Krugman column that ran in the Las Vegas Sun and chuckled as she said upon leaving, "Throw Momma From the Train."

Like a good son, I put it aside to read later, trying dutifully to catch up on last week's reading material first. It wasn't until Thursday that I picked that column up to see what made my mom so nervous.

There it was under a heading, "Bush tax bill bad to the core," which would not normally have caused a stir around my house since we have long known that the tax bill recently signed into law by our president was far more for public political consumption than it was to confer any substantive benefits upon the taxpayers of this great country.

Since I had already written my piece about the folly of the bill as it raced through both houses of Congress with nary a sigh of discontent, I didn't think piling on would help in any respect. That's because I am a firm believer that when the public gets in its mind that something is good, then it matters not how bad it really is.

It is that kind of philosophical view of the modern day political realities that has given rise to a new kind of legislative viewpoint: just give them what they want and try to fix it later. And pass the cost of the mistake on to the consumer. That, by the way, is not a new view!

In any event, I delved into the column hoping to learn more and, frankly, looking for a way to ease the obvious burden my mother was feeling since she read it days earlier. Fortunately for her and unfortunately for me, I found the answer.

There is a big flaw in Bush's tax bill that runs throughout the myriad provisions which are designed to ease our tax burden. And that is the fact that most of the significant cuts don't occur until years later, which makes for a huge rift between the expectations of the presidential promise and the reality of his fulfillment.

But, nowhere is the ridiculousness of this "tax cut" more obvious than in the vaunted "death tax" provisions. The use of the words death tax, of course, came into vogue during the debate on this issue because estate tax sounded too high-end to get the vast majority of the electorate energized.

In order to make the estate tax repeal fit within the $1.35 trillion tax cut, Congress came up with a gradual lessening of the exorbitant tax rates from 55 percent down to 45 percent over a period of years. Then the good news.

In 2010 the entire estate tax burden is lifted and estates of any amount -- from a million or two to Bill Gates-sized, multi-hundred billion dollar accumulations, can be passed tax-free to succeeding generations. Not only will the family farm get to stay intact for the use of the children, but so, too, will net worths the size of farm states pass without an IRS hitch.

But here's the rub and here's what got my poor mother so concerned. Within days or months after the estate tax has ended, it begins again. Yes, you read it right. For a brief time there are no estate taxes to be paid and practically, without warning, they show back up again at today's rates.

So, what does that mean to a person of means like my mother? A whole new definition of estate planning, that's what!

Her biggest fear 10 years from now is that someone in the family will get wise to the idea that we will get 100 percent of her estate should such a young and beautiful woman pass away when tax rates are nonexistent, but if that time comes just a few months later, Uncle Sam will get the lion's share.

Hence, the concern that potential heirs may take matters of life and death into their own hands and my dear, sweet mother may not live to that ripe old age upon which she has based all her plans!

But don't worry Mom, because that law was not meant for you. In 10 years, my generation will be at or near retirement age. We will have amassed estates larger than any in previous history at about the same time as our earning power dramatically decreases. In short, we aren't much good to the economic side of society at that time.

Why should the next generation waste its time on Grandma when it can go after the big kahunas of the baby boomer generation and get it all tax-free? That puts all of us at grave risk that our kids will revive the Dr. Kevorkians in our midst and do us all in. And it will all be part of one big government-incentive plan.

As the result of this foolishness that is sold to the public as ground-breaking tax policy, I have already made plans to be out of town throughout the entire year 2010. I have even made plans to take my dear, loving mother with me so we can both avoid any foreseen but untoward circumstances which would result in a very unjust enrichment of the next generation.

So, if it is my generation that is the target of President Bush's tax joke, why be so nice to my mother, you ask? Because I plan to earn my money the old-fashioned way. Through flattery, of course.

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