Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes

by William H. Gates Sr., Chuck Collins

More than a thousand individuals of high net worth rose up to protest the repeal of the estate tax-Newsweek tagged them the "billionaire backlash." The primary visionaries of that group, Bill Gates Sr. and Chuck Collins, argue here that individual wealth is a product not only of hard work and smart choices but of the society that provides the fertile soil for succes. Weaving personal narratives, history, and plenty of solid economic sense, Gates and Collins make a sound and compelling case for estate tax reform, not repeal.

Genres: Nonfiction, Economics

184 pages, Paperback

First published January 1, 2003

Reviews

[Joanie · Rating 4 out of 5]

While this book is very dated in that it was written prior to the Bush tax cuts being passed in 2001, it seems so relevant now. I loved revisiting much of the material and thinking about why the estate tax was created in the first place. Politicians today are really just so clueless.

[Mary Whisner · Rating 4 out of 5]

You can hear and read a lot of rhetoric about why the estate tax is a horrible burden and should be a abolished. Indeed, the opponents of the tax (which they call the "death tax")'succeeded in enacting a phase-out. This slim book presents a clear argument for keeping an estate tax. I found it quite readable, even though I don't consider myself either a tax nerd or a policy wonk, in addition to technical empties, the authors have personal experience with great wealth: Gates is the co-chair of the Bill and Melinda Gates Foundation, the largest foundation on earth, and the father of Microsoft's Bill Gates, the billionaire. Collins, the great-grandson of meat packer Oscar Mayer, gave away his substantial inheritance at age twenty-six.

[Brien · Rating 5 out of 5]

In a short volume, Gates and Collins make the case for an estate tax. As our nation's wealth gets increasingly concentrated at the top, and with movement among American economic brackets lowest among the OECD nations, it is reasonable to ask if the 1%'ers should not be asked to contribute more to the society that has given so much to them--gifts including no taxes on the first $10 million of an individual's estate. The capital gains of the wealthy, taxed as unearned income, are taxed at a lower rate than the earned income--wages of the middle class. The estate tax, in its puny, wretched condition, is a way for America to maintain a de facto aristocracy, one in which birthright, not merit, not entrepreneurship, is the source of one's status in society. This is undemocratic at its core.

[Gina · Rating 3 out of 5]

There are times when the book is slow and plodding, and other times when it does better. Despite that, the viewpoint is important, and the information is good. The authors make a sound case for the importance and validity of the estate tax. A lot has happened with the economy since its publication of course, so while that does not Make Wealth and Our Commonwealth irrelevant, it does seem to call for an update.

[Ralph Orr · Rating 4 out of 5]

Clearly explains the threat to democracy of concentrations of great [inherited] wealth, and debunks the myth (lie) that the estate tax has forced the closing of family farms and businesses. A must read for those interested in the estate tax debate.

[Monkey]

My favorite economic easy-reader!!!

[Andrew · Rating 4 out of 5]

Informative and interesting read - argues against accumulated wealth without coming off socialist at all.

[Libbie Counselman · Rating 4 out of 5]

Excellent, but a bit outdated at this time. Good info on taxes and how different asset-levels are affected.

[Thomas Horton · Rating 5 out of 5]

Wealth and Our Commonwealth was a text I approached with skepticism - a title about challenging accumulated fortunes written by the father of Bill Gates and a millionaire Washington academic? The inner sleeve of the book cover even begins their arguments with "Gates and Collins argue that individual wealth is a product not only of hard work and smart choices, but of a society that provides the fertile soil for success." I was unsure if this would be an authentic call for the taxation of accumulated wealth. I was delightfully surprised to find that yes, it was indeed, and a masterfully written one at that. In fact, Chuck Collins in particular writes prolifically on wealth inequality, and I plan on reading more of his pieces following this read.

Their first arguments of the book do not highlight the policy at all, but instead provide a powerful framework for we, as Americans, to consider what our values are and what kind of society we want to live and thrive in. The first chapter opens thusly:
"What makes America great are the things we have done to strengthen the equality of opportunity. [...] One of the important things our country has done to strengthen equality of opportunity is to put a brake on the accumulation of hereditary wealth."
The authors precede this note with a variety of powerful questions about how we place value on wealth and how those with means contribute to their greater communities:
- How does a repeal of the estate tax contribute to further aggregations of wealth and power? How does it impact inequality?
- What social harms arise from the overt concentration of wealth? How does it undermine democratic institutions and the common good?
- What is the role of society and our communities in creating institutions that enable individuals to amass wealth? What role does public investment play in the creation of wealth? What return on society's investment is justified?
- What responsibility does our country have to correct gross inequalities?
- What is the responsibility of wealthy individuals to their communities and country, and what should be their attitude on taxation?

These questions spearhead a surprisingly refreshing attitude on taxing the rich; the authors steer the conversation well away from a more socialist outlook and instead focus on how society enables families and individuals to be successful. Therefore, the wealthiest among us have a duty to support the society that enabled them to succeed.

These sentiments are repeated thoroughly and consistently throughout the book. They reference the first concepts of the estate tax which originated in the Gilded Age, the challenges made by FDR to the excessive accumulation of wealth, and finally to the 1990s-2000s, when the book was written, to include the repeal of several provisions of the estate tax. At times, the text does tire in reiterating its primary arguments in a way that feels redundant and/or repetitive, but thankfully, these moments serve to reinforce other arguments or facts about the realities of wealth inequality, and serve as proper reminders of the main idea.

I believe Gates and Collins navigate the counterarguments deftly, and provide insightful ideas to combat the naysayers of taxation and challenging the wealthy, all without vilifying those who have found success in the United States. They do not press the point, but acknowledge thoroughly the fact that most if not all wealthy individuals do not and cannot attain their riches and successes alone, but through the collective efforts of the workers, the government, and the communities that supported them. Today, over two decades after the publishing of this book, wealth inequalities are even more severe, and labor exploitation has become even more prevalent; I am grateful that the authors bring attention to this in some degree.

The statistics are dated and many of the figures must be now adjusted for both inflati0n and the intense increase of wealth disparities. The situations is much worse today, and I believe that this text could stand to grow a great deal in its efficacy were it to be updated with the punishing reality the wealthy have contributed to inflicting upon American society of modern times. Nevertheless, this text is powerful, constructive, and never at any points villainizes the wealthy individuals we hope to call upon to assist in improving the society that got them where they are today.

[Ronnie Sharangpani · Rating 5 out of 5]

An airtight argument about keeping (and progressing) an estate tax, including fiscal, cultural, and philanthropic perspectives. Taxation has a challenging relationship with the notion of Americanism, and the authors show their perspective beautifully.

Some parts of the book may be less relevant, seeing it was published in 2002.

[Richard · Rating 2 out of 5]

A good basic recapitulation of the arguments in favor of an estate tax. Written in 2001 around the proposed repeal, it now feels somewhat dated. Tends to repeat same arguments, and could have been tightened.