A few months ago, my friend Ed Howker, a London-based investigative journalist, suggested to me that resistance to inheritance taxes may reflect an ingrained sense that the family is an institution that exists independent of and prior to the state. Inheritance taxes, under this understanding, don’t give due regard to the importance of kinship bonds. So when people on the left puzzle over why working and middle class people find the idea of an estate tax that will never impact them, the answer, perhaps, is that it offends not only their sense of fairness, but their sense of the appropriate boundaries of state power with respect to intimate life.
Last year, Dalton Conley, a social scientist based at NYU, wrote a short essay on “pregnancy envy” that addressed similar terrain. Drawing on the work of the political scientist Jacqueline Stevens, Conley offered a provocative argument:
[Stevens] locates the decisive “trauma” in the fact that little boys are shocked when they realize they do not possess a uterus and thus cannot give birth to a child like their mothers (who, up until then have generally been their primary caregiver and parental figure in most kinship structures). Given that they are typically so closelybonded to their mothers, this is a moment of alienation, and Stevens argues that this developmental milestone leads to a male obsession with land ownership and property. That is, as a compensation for the inability to be fertile oneself, boys/men seek to acquire the ultimate external fertile object: the land. Further, she suggests that the transfer of wealth to children is the substitution for both this inability to conceive of a child and secondarily the issue of paternity uncertainty, which until two decades ago has been universal across all societies. Thus, the tenuous role of males (who generally control more of the wealth in a household) within kinship structures and the childrearing process is not a trivial emotional consideration to a political psychology analysis and understanding the so-called death tax. [Emphasis added]
Conley goes on to discuss how the advent of public pension systems shapes the landscape:
In developing societies the flow of labor and wealth goes morefrom children to adults. In much of rural Africa, for example, children are important for collecting firewood, hauling water, and helping during the planting and harvesting seasons—hence the relatively high fertility rate. As development progresses and societies become wealthier, however, the stream of resources starts to flow the other way since there is an accumulation of assets as individuals save across the lifecourse and there is also a more prolonged (nonproductive) educational career and adolescence. The result is that, overall age structure aside, the net private flows (since public flows may go in another direction) increasingly go from the aged (or dead) to the young, the richer a society (or sub-group of that society) becomes. One important additional consideration is the emergence of a public pension system, which also sets the stage for the aggregation of surplus privatesavings available for transfer as we age since we need less as insurance of a basic income stream. Along with this reversal of the flow of private wealth across generations, there comes the notion that this is still a quid pro quo and that inheritance upon death (or intra vivos transfers) is the reward, for both the emotional and physical labor, or at least as an insurance mechanism for the aging parents to exact compliance among the young under threat of disinheritance (rules about divisions of estates obviously vary among rich countries quite substantially in this regard).
When seen in this light, it raises the question: Is there not somevalue from excluding inheritance and intra vivos transfers from the market exchange (and therefore tax) system? By allowing this transfer tax-free within families, just as spouses’ pocketbooks are legally one and the same, we affirm the private kinship sphere outside of the market. Thus, psychoanalytic theory aside, the role of tax policy increating boundaries between public and private spheres has been underappreciated by tax policy scholars and that is where—I imagine—alot of this emotional resistance comes from regarding estate or inheritance taxes. [Emphasis added]
Conley doesn’t take any position on whether estate or inheritance taxes are an appropriate policy or not. Rather, he argues that we need to take the psychological landscape into account when we design institutions.
One thought that concerns me: given that paternity uncertainty is no longer an issue, at least in affluent societies, should we expect that the drive for wealth accumulation will no longer prove as powerful for as many people, and in particular for as many men? This might be another part of why, for example, labor force participation and marriage rates have declined so sharply for working class men, though I should stress that this is very speculative indeed.