Sloan Sessions: Estate tax
TEXT OF INTERVIEW
SCOTT JAGOW: Senate Republicans are vowing to keep up the fight on the estate tax. Last week, they came very close to getting rid of it. Newsweek's Allan Sloan says believe it or not, a lot of wealthy people should be glad the tax is still around. Good morning, Allan.
ALLAN SLOAN: Good morning Scott.
SCOTT JAGOW: For heaven's sakes, why?
ALLAN SLOAN: Well first let me tell you there's a difference between the well off and the small rich, who are better off the way things are, and the big rich, who are worse off the way things are. And there are a lot more small rich than there are big rich.
SCOTT JAGOW: Well maybe I'm missing something, but no tax versus 45 percent tax?
ALLAN SLOAN: Well it goes like this: In the year 2009 you get to exempt from tax estates of up to $3.5 million dollars or really $7 million for a married couple. Their heirs get a tax break, however, under the repeal legislation they wouldn't get to do this. And when you do the math you discover 65,000 estates are better off under the 2009 rules than they are under full repeal. And only 7,500 estates are better off under full repeal.
SCOTT JAGOW: Well if only a few people with these huge, huge estates would be affected, why do you think that this became such a big issue?
ALLAN SLOAN: Because it sounds like a big issue, because it's been marketed extremely cleverly. And let me just say for the record, that the two biggest estates coming down the road in the United States are Warren Buffett and Bill Gates. Warren Buffett is urging that some form of estate tax be left, and Gates's father is involved in something called Responsible Wealth, which is an organization wanting some sort of estate tax to stay in force . So it's as if there's some sort of unilateral thing among the big rich. This has been seized on by a handful of people, marketed extremely cleverly for years. The debate is all about emotion and images and carrying on and large phoniness.
SCOTT JAGOW: But you do have a dog in this fight, so I guess we should disclose that right?
ALLAN SLOAN: Sure, my dog is if this were 2009 and tomorrow my wife and I were run over by an angered listener to this program, I think my estate would be somewhere in $1.3 million to $3.5 million range, much of which would be my house by the way. But you know I'm just offended by the low level of the debate in Washington about fiscal matters and the high level of emotion and a low level of truth.
SCOTT JAGOW: Allan Sloan is the Wall Street editor for Newsweek magazine. He's back in a week with an edition of the Sloan Sessions. In Los Angeles, I'm Scott Jagow. Thanks for listening and enjoy your day.