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Sterling: Here's one possible unfortunate scenario of the estate tax:
A grandfather with 4 children passes away. Over the course of his life, he bought two houses in nice areas, and worked hard to save a fair amount of money to invest. So he has two houses worth 1.5 million each, and 300,000 in stocks and bonds.
He wanted to split his estate equally between his children. Unfortunately, due to the high value of his homes, he's over the estate tax limit by 1.3 million. Just about half of that goes to estate tax - so the family has to liquidate over 600,000 before they can settle the estate.
So they have to sell all the stocks and bonds and one of the houses. And they'd better hope that between the valuation and the sale the housing and stock market don't go down.
One of the family houses is gone now, as well as a large portion of their investment, not because the family were wealthy hoarders, collecting private jets and buying islands, but because they invested wisely and were fortunate that their homes appreciated in value. Sorry grandchildren, we can't go to grandma's cabin any more because we had to sell it.
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posted
I suspect that's true Samp. Even with the taxes and regulatory costs, using modern farming techniques and taking the premium away from what might be a lack of supply and the premium of buying anything that's illegal like that, I think the cost would very likely bottom out as well.
Then again, I haven't the foggiest clue as to what the price of marijuana even is right now. I've never tried it, and don't really ever plan to, though I admit to being curious about it.
Were I president, I'd appoint a commission to look into some of the aspects of the issue. I'd want a health effects report written out clearly to detail the damage it does and in comparison to alcohol and tobacco, the potential dangers involved and the economics of it. And we'd have to look into how many people would get out of prison as a result, or if they would at all. I'd probably seriously consider a blanket amnesty for most of those in prison for marijuana, if there are any, I don't know the situation in prisons for marijuana users.
Then with my report in hand, I'd take it to the people.
Toad -
Actually I suspect large amounts wouldn't be that hard, which is why I was wishwashy a bit before on the legality of large amounts. A single cigarette would be impossible to tell. But a few pounds of it would be traceable, because there'd have to be a paper trail. If there's no paper trail, it's probably illegal. If you assume that all marijuana is grown at legal, licenses farms and then processed and shipped, there's a record along the way that accounts for all of it, and if you find a large amount of it somewhere with no paper trail, you can probably rightly assume that it isn't licenses and is therefore illegal. At least in theory.
MC -
Why wouldn't they just sell a house and keep the rest of the cash? They could sell one of those super expensive homes (a million and a half dollar cabin?) and still get 900,000 back from it, and combined with the other 1.5 million dollar home have a very large chunk of cash and the other super expensive home. Would they get hit with capital gains taxes on top of the Estate Tax if they sold the stocks and bonds?
Cause that'd really suck.
Given all the things that are counted in the tax, like property, bonds, stocks, cash, businesses you own, cars, etc. I think people who think they really don't have any money at all could easily find themselves actually worth quite a bit, similar to the situation you described above. At the very least, I'd support jacking up the exemption rate to I don't know, $10 million, and lowering the tax rate to 25%.
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My grandfather recently died and his estate was somewhere around 10m. my mother and my uncle are managing that estate now and .. well, you can save the real estate easy. And the stocks and bonds can be dealt with too. And a lot of it can be kept safe in trusts. But the haad rub is that it's such a massive, hideously contorted hassle, and I'm pretty sure that making this a process that kicks in when your parent dies assures that this is among the more abrasive ways for the government to take a huge cut of anything.
I'd be happy without an estate tax but my personal interest in that idea due to present circumstances probably has a lot to do with it. I ain't much in a position to talk about it right now.
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I think people who grew their own marijuana for personal use would continue doing so, but the people I knew who did that only grew for himself, not a dealer. I am annoyed that marijuana research only gets funded if you research why it is bad (well, federal funds). Supposedly, the NIH will not fund anything that may make marijuana look good- so people doing research on its painkiller effects have a hard time getting money. If they had robust research, then the medical marijuana argument might diminish as a good substitute would be available.
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quote:Originally posted by Rakeesh: That sort of thing has been tried before, the idea that there shouldn't be any sort of government institutions helping the desperately poor. Scope out some Dickens for a nearly worst-case scenario.
Actually, most of what you'll find in Dickens is governmental handling of poverty. (His stories are set in Britain, of course. In the US things may have been private.) However, the fundamental reason things were bad in the nineteenth century was not the organisational form of charity, nor any lack of fellow feeling, but the plain fact that people then were poor. Dirt poor. Not just the factory workers, everyone. The middle class lived in conditions that our welfare recipients would sue the state for imposing. And they'd win, too. There's just a limit to what can be done with that sort of resource base.
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Government handling, yes, but the government handling was so anemic due to funding that it applies, at least in my head anyway:)
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quote:Originally posted by Jhai: Only some libertarians (or, as I prefer, classic liberals) believe that they don't have any responsibility for others. Many believe they do have responsibilities to others, but don't believe that those responsibilities require legislation or government intervention. Like charities, which were pointed out up thread. I know several libertarians (both little-l and big-L) who aren't rich, but donate 10% or more of their earning to charities.
posted
It seems to me that drug laws ought to be based on the effect of the drug on society, not merely the presence of the drug.
Like with alcohol, there are laws against drunk and disorderly conduct, driving while intoxicated, etc.
I have a friend whose mother was killed by a driver that crossed into her lane and ran into her head on. It was found that she (the other driver) was smoking pot at the time, but for some reason, the police didn't penalize her until the families of the victims pushed for prosecution. She ultimately was found not guilty, not because she wasn't found to be smoking pot, but because they didn't have a number, like .08 blood alcohol concentration, that they could use to determine if marijuana had been a causative factor in the accident. In this case "zero tolerance" simply didn't mean anything to the jury.
It seems to me that if the laws against drugs are based on the damage they do (and that those laws have real teeth), then the laws against the drugs themselves become superfluous. Then you could legalize the drug and regulate it.
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quote:It seems to me that drug laws ought to be based on the effect of the drug on society, not merely the presence of the drug.
It also has to give a nod to concerns involving how effective the authorities can be at curtailing the drug.
Marijuana is effectively uninhabitable as an illegal substance in this country. If someone wants it, they can get it, no problem.
Using it as a contemporary example, a realistic approach shows that the ban on marijuana, regardless of intent, only has the effect of empowering and encouraging a black market.
Oddly enough, according to the Atlantic, the end result of this sort of supply and demand issue is that if marijuana were to become legal, the bottom would fall out for illegal distribution networks. The biggest losers would be groups like MS-17, who also use the marijuana demand to support a trade network that gets blow from columbia to businessmen and suburbanites in New York. The price of that blow would go way, way up because there's no longer a thriving commercial enterprise in smuggling to america; the bulk of it was in pot.
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quote:Marijuana is effectively uninhabitable as an illegal substance in this country. If someone wants it, they can get it, no problem.
Using it as a contemporary example, a realistic approach shows that the ban on marijuana, regardless of intent, only has the effect of empowering and encouraging a black market.
Do you have anything to back that up? Common sense seems to say that there are people who, because pot is both illegal and expensive (because it's illegal) either don't use it all or don't use it as much as they would otherwise.
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This is purely anecdotal, but it's been my experience that, given the incredible access most people have to it, and the unlikely chance of them being caught, anyone who wants to do it does, and anyone who doesn't, doesn't, and illegality doesn't really factor in all that much.
But the people at my work are generally young and party goers.
Analytically though, I'd say there has to be a decent sized population that doesn't do it for the reasons MPH stated, and those people might choose to try it if it were legal. But on the other hand, there's still a significantly large population of people that use it regardless, and I think we're sort of settled into a system where millions of people use on a regular basis without much thought to it, making the illegality of it sort of silly. I think it's at the point where you have to weigh the pros and cons, and I think the people who use regardless and the problems that come from that outweigh the potential feared risk of those who might start using if it were legal.
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quote: One of the family houses is gone now, as well as a large portion of their investment, not because the family were wealthy hoarders, collecting private jets and buying islands, but because they invested wisely and were fortunate that their homes appreciated in value. Sorry grandchildren, we can't go to grandma's cabin any more because we had to sell it.
MightyCow, the scenario that you described does not sound unfortunate to me. Each of his children gets over half a million dollars in assets that they did absolutely nothing to earn. That sounds a lot more like a windfall than any sort of hardship.
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For example, we might compare statistics for Europe, in particular the Netherlands where marijuana is legal and easily accessible; and the US, where it isn't. Comparing "use within the last 30 days" for 16-year-olds, we find 14% for the Netherlands and 14.2% for the US. Then you have to allow for US teenagers being perhaps a little less willing to admit to such use even on an anonymous survey.
Edit: In response to mph.
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quote:Do you have anything to back that up? Common sense seems to say that there are people who, because pot is both illegal and expensive (because it's illegal) either don't use it all or don't use it as much as they would otherwise.
Well I got beaten to the punch on it but
quote:The war on drugs may be actually increasing, not decreasing, teen drug use. Or it could be having no impact at all. Such are the responses provoked by a study released this month. The European School Survey Project on Alcohol and Other Drugs (ESPAD) survey, comparing drug use between American teenagers and European teenagers, found that a much higher percentage of American teenagers consume illicit drugs than do their European counterparts.
The study, which was released last month at a meeting of the World Health Organization in Stockholm, was conducted by questioning tenth graders from nationally representative samples. 110,000 teens from Europe and the US participated in the questionnaire.
One of the ironies of the drug war is that where it was been waged most loudly and enthusiastically is precisely the place where teen drug use is now most entrenched. Conversely where drug war rhetoric is comparatively mute, teen usage of illicit drugs is much lower. In the Netherlands, for example, which has the most liberal drug policy in Europe and where marijuana is effectively legal, marijuana use among teens is actually lower than in the United States. The survey found 28% of Dutch teens smoked marijuana as compared with 41% of American teens, and 23% of American teens had experimented with other illicit drugs as compared with only 6% of European teens.
But when it comes to legal drugs, such as cigarettes and alcohol, teen usage is much higher in Europe. Thirty-seven percent of European teens had smoked cigarettes in the past month as compared with only 26% of Americans. Sixty-one percent of European teens had consumed alcohol as compared with only 40% of Americans.
When asked about the disparity, Kevin Zeese of Common Sense for Drug Policy pointed to the lure of the forbidden as a major factor. "It is worth pointing out that the Dutch, when they made marijuana available for purchase, said one reason they were doing so was to 'make marijuana boring,'" Zeese told DRCNet.
"Our approach, making marijuana a forbidden fruit where the primary educators on the topic are DARE police officers, has the opposite effect. We make marijuana a magnet for the natural rebellious period of the teen years," Zeese explained. "The laws are easy to break, highlighted in ads and schools, the schools lie about the dangers of marijuana and police are the messengers -- that all adds up to a recipe for encouraging, rather than discouraging teen use. Then, our failure to separate the marijuana market from other illegal drug markets makes it natural to purchase other drugs from the high school dealer."
But one drug policy analyst, Peter Cohen, a professor at the University of Amsterdam, disagrees. He told DRCNet that the study simply shows the drug policy has no effect on drug use. "All modern studies, if done in a way that allows some comparison at least, do not show a very convincing effect of drug policies at all. Determinants of drug use are complex and multiple, like fashions, cultural basics, economic and social situations, etc," Cohen argued.
"Drug policy -- a set of formal rules and laws -- does not seem to play an important role here. Drug policy is much more a tool for value communication and symbolic suppression of perceived deviance, than for real impact on drug use levels," said Cohen.
Now I actually am not one of those zealous Legalize! guys and I don't actually even do any drugs (I am one of maybe three people in my peer group who do not smoke pot at all, since the consumption here for us young guys is practically ubiquitous) — my reaction towards rulings to legalize or keep pot criminal is always a 'meh' — but there's certain things (like this) that I find really intriguing about the drug wars. Keeping pot illegal at this point is probably either having no effect or actually increasing use.Posts: 15421 | Registered: Aug 2005
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quote:Originally posted by Amanecer: MightyCow, the scenario that you described does not sound unfortunate to me. Each of his children gets over half a million dollars in assets that they did absolutely nothing to earn. That sounds a lot more like a windfall than any sort of hardship.
Isn't it a parent's job to provide for their children? At what point does good parenting, good business, and thoughtful savings become greed?
People always say that a home is the best investment you can make, but lots of people have to sell their family home to pay for estate tax, because the home is a good investment. I don't see any cause for that.
Why is it the family home before the death of the parents, but it's an asset that needs to be sold the second after the death of the parents?
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