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June 07, 2002
Reporting the Death Tax

The House voted yesterday to permanently repeal the death tax, which currently allows the government to confiscate the majority of any value an estate, farm, or business has above $1 million upon the death of its owner. The recently enacted tax legislation dictates that the tax will be gradually phased out, and the exemption simultaneously raised, until 2011, at which point the tax returns in full force. This strange situation has prompted many to call it the "2010 Suicide Tax," and Republicans are now pushing to replace this silly scheme with something permanent. Americans currently spend more to avoid the destructive effects of this tax than the government collects from levying it, but given that the bulk of its victims tend to be wealthier and Republican, it is a Democrat's wet dream.

It's interesting how the story was covered by major news outlets. Remarkably, in stories about the tax, the New York Times and Reuters fail to tell the reader what the current tax rate actually is. (To their credit, MSNBC and Associated Press do provide this important datum.) Writing about a tax without revealing the tax rate is akin to writing a story about a baseball game and not telling the reader the final score. Perhaps the writers avoid doing so because revealing that the government seizes 55% of a person's wealth upon his death would detract from the soak-the-rich message. Everybody loves to hate the rich, so why detract from this sentiment by explaining to readers exactly how much the government takes, or that the wealth confiscated is usually not sitting in cash, but in investments and equipment that make jobs for thousands of citizens?

One would think that enterprising journalists would find any number of juicy things to expose about the death tax. It destroys small businesses valuable to communities, it disproportionately hurts women (who tend to be the survivors hit with the tax bill), and actually does little to advance that great Democratic idol, equality. If the economics scare them, they can fall back on the journalistic method of interviewing sympathetic victims. Lord knows, if this were a story about, say, alleged toxicity of ink, we'd all be listening to some guy tearfully describe how his testicles shrank after he got a tattoo. Don't hold your breath waiting for Dan Rather to interview a grieving family who has to sell their business because the government wants half its book value, however.

The rich-versus-working class trope is just too appealing, even when it is largely misapplied. The real rich versus working class angle here is the conflict between families who have to fold their businesses because of the death tax, and the superwealthy, who argue in its favor, because doing so earns them fawning press, and because losing half of their wealth, especially given that their businesses are incorporated entities, won't place their survivors in financial jeopardy. Elites like Soros and Rockefeller can afford their "socially conscious" poses. A businessman in Iowa with a small chain of stores can't, he's too busy creating jobs and community value on a tight budget. And he's just a statistic; the heavy hitters in this area are either cultivated elites who favor the death tax, or conservative wealthy Republicans who oppose it. When journalists survey this field, it's no surprise who they side with; theirs will always be the tribe of arts and letters, not the tribe of money. So it's not an ideological obsession with equality at all costs that causes journalists to give short shrift to families hurt by the death tax; they do so because they just don't know people like this.

This seems often to be the case. Journalists aren't overtly biased, but they depend heavily on their personal social networks for information, and most importantly, for a sense of how to frame a story. Given this inevitability, perhaps news media outlets would do well to require national news reporters to do field service in flyover country for a minimum number of years before being absorbed into the intellectual cliques of metropolitan coastal areas, with their clipped, simplistic frames, their self-absorption and condescension.

The alternative is that they continue to write stories like those mentioned above, which talk about a tax but not what it does to people, how much it takes from them, how often it ruins what someone spent a lifetime creating. Continue on this path, and readers will continue to disappear, the dull ones because the news is boring, the intelligent ones because they know there is much more to the story. This suggests a growing bifurcation; the former, increasingly aliterate anyway, will turn to variations of the tripe that serves as television entertainment, while the latter will turn . . . where?

Good magazines and ezines, ideological but trustworthy news sources, and perhaps -- blogs. To think that a blog can ever replace the raw data-gathering ability of large organizations is a pipe dream. But the challenge is not so much the collection any more, it's the assemblage and framing of this information. And journalists, national and local, seem increasingly impaired when it comes to doing this effectively.

Posted by Woodlief on June 07, 2002 at 11:08 AM


Comments

In our free-market society, those that "frame" the information in an appealing manner should be rewarded. I think we are in a transitional time, where raw information/news is a commodity offered by a few large organizations, and it is up to the various framers to make it presentable. Whether that comes from bloggers/Internet or the traditional media outlets will depend on who can capture and hold "eyeballs", as well as being able to turn a profit from the eyeball grabbing.
The death tax could be considered double taxation, although you might get a few liberals claiming it is capital gains (and let's not get into the argument of taxing capital gains). Oh, for a flat tax rate and very limited deductions - but then what would politicians do to exert power?

Posted by: MarcV at June 7, 2002 2:58 PM

>> To think that a blog can ever replace the raw data-gathering ability of large organizations is a pipe dream. But the challenge is not so much the collection any more, it's the assemblage and framing of this information.

The large news organizations get their raw data mainly from two sources: (1) the AP wire (2) press releases from "non-partisan" = left-wing interest groups. Bloggers can access the wire services just as easily, but tend to rely on a much more varied set of personal, literary, or web-found sources for the rest. Blogs are more like small-town newspapers 100 years ago, in the days when a town of 10K people would have 3 papers, each establishing a fiercely different "brand identity".

The situation in mainstream journalism is in fact identical to the FBI/CIA problem: plenty of raw input, but tunnel-visioned selection and analysis.

Posted by: ockham at June 8, 2002 11:35 AM

An interesting aspect of the death tax that deserves a thorough Den Beste treatment is a comparison of the current US death tax to the inheritance laws of the Koran.

I remember (but cannot locate) a blog from several months ago that contented one of the reason that the Muslim world failed to maintain the economic lead that it had in the 7th century was that the Koran called for a strict division of estates. A small or medium merchant who had built up a good business could not pass it on when he died. Each time in the estate had to be equally divided among the heirs. Effectively each generation would have to start from scratch. In the Holy Lands, when given a choice between the Koran’s inheritance laws and the European inheritance laws, the European laws always kept the business alive after the death of the owner. The only Muslims that were able to survive this were the princes and the super rich. Over time it built a society of the few haves and many have-nots with little mobility between the two.

In the same way, the death tax has shaped the American landscape over the last 50 year. It is ironic that the people who hate the MacDonald’s uber-corporations are the same ones who create the conditions that make MacDonald’s prosper. Death tax does nothing to MacDonald’s, Walmart, or Home Dept. It destroys Jim’s Diner, Joe’s Emporium, and Jack’s Hardware. It creates an environment hostile to the little guy. When Jim, Joe, or Jack go out of business, who has the ability to step in and take over their location? Mac, Wal, and Home. Indeed, if the argument against the death tax was framed as holding off the global corporations, how long do you think it would last?

Posted by: Rick V at June 9, 2002 11:45 AM