Thursday, December 16, 2010
Why the Food Movement Should Like High Estate Taxes
A common refrain against the opponents of the
death estate tax is it will harm family farms. It will force the sale of farms which have been in the family for generations. Assume a 1,000 acre in Iowa, valued at $7,000. If husband and wife are the owners, then the exemption has to be at least $3.5 mill (which I think is what House Dems want). But of course, some farms these days are larger. So what happens if the estate tax is applied: presumably the owners sell off some land. Selling land puts more land on the market and presumably improves the chances for aspiring farmers to break into the business. That's what the food movement would like, more and smaller farms. So the food movement should be pushing for lower estate tax exemptions. And I don't see a free market rationale for preserving the larger farms--if bigger is better, as most commercial farmers think, the new owners will simply assemble land parcels into a new, big farm.