Thread: When is it no longer your money?

Subconciously, I think all American's favor a system that rewards work and effort. Not all physical, but whether it come from pounding shoe leather to endless risk assesments, In America most agree that work = money.

But an Op-Ed in todays Times raises the question of whether or not we're creating an aristocracy in America. Written by Ray D. Madoff, a professor at Boston College Law School, and the author of “Immortality and the Law: The Rising Power of the American Dead” he says...

This type of trust is new because until very recently most states had a “rule against perpetuities,” which limited the term of any family trust to about 90 years, after which time the family members would own the property outright. This rule derived from the idea that property is best controlled by the living.

In the mid-1990s, however, many states repealed the perpetuities rule, and now any wealthy American can set property aside for his heirs forever, simply by hiring a trustee from one of these states.

What caused state legislatures to abandon a rule that had existed since the late 1600s? Banking industry lobbyists persuaded them that it would be a lucrative move because it would bring business to their states. But it was Congress that set the stage nearly 25 years ago.

In 1986, Congress instituted the generation-skipping transfer tax. This closed a loophole in the estate tax by ensuring that property would be subject to tax as it passed through each generation, even if it would otherwise have avoided estate taxes because it was held in trust. (It prevented “generation skipping.”) However, in enacting this tax, Congress gave each taxpayer a $1 million exemption, which was raised over the years to $3.5 million.

I know a few of our conservative friends here would suggests that taxs are never good, but at what point do we say that it isn't your money if you didn't raise it? Its a slippery slope, but on the other end, how is this any different from the welfare state?