The Oddly Unpopular Estate Tax.

In a former life I used to write polls as part of my job, and at one point, we decided to do a small test on the estate tax. The unpopularity of the tax is something of a mystery, since it's paid by only the richest heirs. As Kevin Drum says, "Polls routinely show that a substantial majority of people favor higher income taxes on the rich. But polls also show that a substantial majority of people favor repeal or reduction of the estate tax." At the time (this was back in 2000), I thought it might have to do with a misconception, namely that lots of people assumed that everyone who inherits anything has to pay the estate tax. So we did an experiment in a survey where we asked two versions of the question, one of which asked whether people thought the tax should be repealed, and the other of which explained that the tax was only paid by people who inherited a million dollars or more (or whatever the exemption was back then), then asked whether people thought it should be repealed.

The results didn't show much of an impact of the information: While support was lower among the group that got the explanation, it was only lower by about 10 points. As I recall, it was something like 65 percent supporting repeal without the information about the exemption, and 55 percent supporting repeal with the information (the data are in here somewhere, if you care to track them down). So the lack of information mattered, just not that much. Here's Kevin's explanation:

Like it or not, I think that most people simply have an instinctive feeling that you should be able to bequeath your money to whoever you want. If most bequests went to, say, political parties or yacht harbor upkeep groups, things might be different. But as long as most bequests go to family members, you're dealing with a very deep, very primitive protective instinct that most people sympathize with no matter how rich you are. After all, I feel that, and I don't even have kids.

There's another element too: Americans tend to think that no matter what their current situation, eventually, they're going to be rich. Most of us are wrong about that, but that's what we think. It's practically our patriotic duty to believe it. So most everyone thinks that this tax will apply to their estate upon their death, no matter how modest that estate might be at the moment.

Combine all these factors -- the misunderstanding about the policy, people's desire to pass on everything they have tax-free to their kids, and the widespread belief in future riches -- and add in the fact that Republican communication on the issue has been brilliant ("death tax") and Democrats can't figure out what to say -- and you have a policy without very wide support. That being said, there's no evidence that anyone but really rich people and the Republicans who represent them care very deeply about this. So while repeal gets high marks in polls, Americans aren't exactly beating down the doors of the Capitol demanding it.

By the way, Democrats could have a clear message on the estate tax if they tried. Here's one: "Why shouldn't Paris Hilton have to pay taxes, just like people who work for a living?" It's not complicated. It makes the (accurate) point that the people who would benefit from eliminating the estate tax are rich heirs, of whom Paris Hilton is the most famous example. It emphasizes that the tax system ought to be fair to all of us. And it forces Republicans to answer a difficult question. That wasn't so hard, was it?

-- Paul Waldman

You may also like