This was a very big week for American billionaires in the news. On Tuesday, Facebook founder Mark Zuckerberg and his wife Dr. Priscilla Chan marked the occasion of their daughter’s birth to announce that “during their lives” they will donate 99 percent of their Facebook shares to charitable purposes. But just one day after we learned that the new Chan Zuckerberg limited liability corporation will contribute or invest some $45 billion focused on “personalized learning, curing disease, connecting people and building strong communities,” Americans learned something else about the other 399 people on the Forbes 400. “With a combined worth of $2.34 trillion,” the Institute for Policy Studies revealed, the Forbes 400 own more wealth than the bottom 61 percent of the country combined, a staggering 194 million people.”
As it turns out, the stories the one billionaire’s largesse at a time of ever-increasing concentration of wealth are related. In a nutshell, if you want more of the former and less of the latter, just increase the estate tax.
As the Center on Budget and Policy Priorities (CBPP) documented, the estate tax is a major revenue raiser for Uncle Sam. Despite the $246 billion, it is forecast to add to the U.S. Treasury between 2016 and 2025, the tax impacts only about 2 out of 1,000 estates each year. In 2013, only 20 family farms and small businesses paid the levy at all, debunking longstanding GOP mythology. (The impact on family farms and small businesses was infinitesimal in 2000 when the estate tax was 55 percent on individual estates worth more than $650,000; with the tax now 40 percent only on estates over $5.43 million, it almost completely disappeared.)
But eliminating the estate tax—which congressional Republicans and virtually every 2016 GOP presidential candidate wants to do—wouldn’t just blow a hole in the federal budget. That addition of a quarter trillion dollars in new red ink would also slash charitable giving in the United States.
Here’s how the massive gain for millionaires and billionaires would mean serious pain for America's churches, nonprofits, foundations and charities.
