Quote:
Originally Posted by Enoch Root
So if mom and dad work hard and save some money, you don't think they should be able to pass that on to their children? Are we going to eliminate all personal motivation from the system and share everything equally? Because if we are, please let me know so that I can retire tomorrow and stop working so hard.
Also, your premise that all wealth creates class division is just not as cut and dried as you are suggesting.
First of all, anyone can be successful - the barriers to success are small. Yes, there are advantages to being wealthy, and yes, there are barriers from being poor, but everyone has some opportunity at success. And everyone has plenty of opportunity for failure. According to one source, only 21% of American millionaires received any inheritance, and only 16% received more than $100,000. (there are lots of studies and numbers online, so I am not going to bother quoting any one of them as the studies are typically informal - it is the aggregate data that is more relevant here)
Second, receiving that inheritance is not the automatic ticket to wealth building and class segregation that you are suggesting. Again, there are various informal studies that give a wide range of data, but the aggregate message is clear: people who receive an inheritance are often inclined to blow it, and the numbers for the 3rd generation (the grandkids), appear to be even worse. I have seen studies that suggest as many as 80% of inheritances are gone within 2 generations. Actual numbers are impossible to determine, but we can be confident that a significant number evaporate or largely evaporate.
Another thing that we tend to see is that the recipients tend to spend the money (one study suggested that most recipients spend at least half of the money fairly quickly (within a couple years or so). One of the complaints about saving is that the money isn't being spent - it isn't isn't 'in use'. However, once passed to the children it does tend to get spent. So that concern isn't all that great either.
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Sorry Enoch, the bolded is an outrageous statement and shows a lack of understanding to what most low income families truly go through. It is not at all fair to say the barriers to success are small. As someone who went to private school, had my university paid for, and had every leg up in the world, I can say when compared to my peers I certainly was starting from a huge advantage. That advantage cannot be overstated.
Are there cases of low income individuals being able to be successful? Absolutely. But statistics show that they are far more likely to not graduate university.
As for mom and dad working hard, for sure - they should be able to pass some wealth down to their children. However, I believe to an extent anything over and above a threshold should get taxed heavily. Jury is out on what that threshold could or should be.