
Ask HN:  Do you think inheritance should be illegal? - amichail
What exactly is the rationale behind such an unfair concept?<p>Why not give away the money to a charity or the government once someone dies?<p>You could even have a system that limits how much money parents can give to their children while the parents are still alive, again, in the interest of fairness.
======
grellas
In English history, the ages-ago method of bequeathing one's estate consisted
of the "fee-tail" system - that is, property was passed (or "entailed") by
lineal descent in a way that allowed the testator to control it for
generations to come (for example, "I bequeath Blackacre to the eldest
surviving male from x line, provided that he does not marry a non-Aryan wife
and, if he does, then to the next male heir in succession and, should so-and-
so (or anyone in his line) die without male issue, then Blackacre shall revert
to the oldest surviving male in y line.") This is the world of _Pride and
Prejudice._

Now _that_ was a system that cried out for reform and it was reformed, in
time, to the point where legislatures abolished the fee-tail system in favor
of a "fee simple" system - meaning that, once property was transferred, the
transferee had the full bundle of rights relating to its disposition,
including the power to alienate it during that person's lifetime and the power
generally to bequeath it to whomever that person desired.

In the midst of this, the law injected value judgments of varying types, one
of which was to _favor_ children, meaning that if someone died intestate
(without a will), the law set up default categories by which the decedent's
property would pass, and this routinely favored spouse first and then direct
lineal descendants, i.e., children. Indeed, even if a testator (person with a
will) intended to disinherit children, he had to follow prescribed forms for
doing so or the law would presume that he intended to leave appropriate shares
to all children.

This is the legacy we have in the United States from the English common law
tradition. It is based fundamentally on the idea of private property and on
laws promoting what we today call the "nuclear family." And this is, by and
large, the way the law has continued to this day, though the idea of "family"
has broadened somewhat.

In theory, none of this needs to be as it is. If the state reigned supreme in
people's lives, and if private property were regarded as an evil, then
confiscatory policies could be enacted as desired. Of course, if one's estate
were to be routinely confiscated upon one's death, then the equivalent of the
modern "gift tax" proscription would also need to be in place, preventing a
living person from making _inter vivos_ transfers to his children as a way of
circumventing the ultimate confiscation that society deemed to be fair. This
would mean that the idea of "private property" would become largely illusory.
No one would own property as such. Rather, each person would have a lease of
sorts on property during one's lifetime, with a reversionary interest held by
the government.

Since such a system would ultimately lead to widespread government
confiscation, it would not long leave us with a free society but rather one in
which we each would be required to seek permission from the sovereign state to
use "its" resources as its bureaucrats and regulators deemed just.

The modern estate tax doesn't do this because, even while it seeks to promote
the idea of busting up large estates at a person's death in the name of
fairness, it comes nowhere close to doing this. The vast majority of average
middle class people have always fallen under the minimum threshold such that
the tax has not applied to them and, if it has, it has applied in a
comparatively innocuous way - that is, it has imposed a tax on some portion of
the estate such that the heirs still retained the larger portion. For
extremely wealthy people, a system of foundations has been established by
which the heirs can effectively control the family fortune even as it bypasses
the normal estate-tax mechanism.

Thus, the question becomes, is the fee-simple form of property ownership, with
its system of vesting the full powers of ownership and disposition in the
hands of private individuals largely free from the authority of the state, a
system in need of reform in the same way that, say, the old fee-tail system
cried out for reform?

This is ultimately a question of the values a society seeks to reflect, with a
state-run society of individuals largely beholden to the government for major
elements of their subsistence versus a society grounded in individual rights,
as best summed up in the Declaration of Independence, who are free to engage
in "life, liberty, and the pursuit of happiness" free of the influence of the
state. "Fairness" in this context in a purely subjective term rooted in one
set of values or the other.

It took centuries to move from a system of medieval serfdom to a system of
fee-tail to a private property system of fee-simple ownership. I doubt that we
would want to throw the modern system of property ownership away without some
pretty careful thought and not without careful consideration of what has
happened (or one might say the horrors of what has happened) in societies that
do not respect private property ownership.

~~~
abalashov
Thank you for taking the time to provide that overview. I found it very
thoughtful, judicious, jurisprudentially precise, and all-around edifying. The
treatment you give to the issue -- specifically, of the question of its
logical implications ("This is ultimately a question of the values a society
seeks to reflect,") -- represents an ethos to which we should all aspire.

------
ionfish
Given all the discussions here recently about the unintended side-effects of
changing incentive structures, it's worth bearing in mind that providing for
one's children (including after one's own death) is an important—perhaps _the_
important—incentive to attain material wealth. Take it away and you may find
you have taken away much of the reason people work in the first place.

~~~
abalashov
It may be that there are far-reaching side effects beyond the immediate issue
of passing the hard-earned fruits of one's labour to children.

If it is suggested, hypothetically, that the ability to pass wealth to
children is _not_ a material reason for people to work to accumulate it, it
may nevertheless be the case that their incentives to work are contingent upon
indirect conceptual ligaments of their children's prospective inheritance. For
example, they may make certain assumptions about the life their children would
be able to lead in connection with - but not exclusively because of - property
they may come to possess.

Edit: In addition to possibly removing an incentive, it may even go so far as
to create an explicitly negative _disincentive_ for many people--people who
believe the government is least morally entitled and least competent to
dispose of their money. Like it or not, many people who possess the ability
and the inclination to accumulate wealth for themselves through the
transaction of commerce of some description feel this way about the
government, precisely because the government supports those who lack that
ability or desire. Wealthy people feel that that choice is for others to make
for themselves (or, if the choice is truly not theirs, gain or suffer from as
a consequence of certain natural and inexorable variations in the content of
people's lives and the limitations of their abilities and intelligence), but
not one that should have repercussions for them and the choices _they_ have
made.

------
btilly
I was all set for an interesting discussion on inheritance vs composition in
OO design, and instead I got _this_?

Ah well, I'll answer the question posed. To me the only reason to reward
different people differently is to create incentives to motivate people to
produce more. Inheriting great wealth takes people who likely have the ability
to produce and robs them of the incentive. Therefore I find myself in complete
agreement with Warren Buffett that _a very rich person should leave his kids
enough to do anything but not enough to do nothing._

~~~
ggchappell
> Ah well, I'll answer the question posed.

Except that you didn't, you know. You said what rich people should do with
their money. The question was what rich people should be _allowed_ to do with
their money. And that is really a very different question.

~~~
nfnaaron
"The question was what rich people should be allowed to do with their money."

No, the question was, what _people_ should be allowed to do with their money.

My answer: rich or poor, it's your money, and you should be allowed to buy
anything you want with your money, including comfort for your children and
fish.

"Why not give away the money to a charity or the government once someone
dies?"

If anyone is less deserving of my money than my children after I die, it's the
government. They squander it now while I'm watching, I shudder to think what
they'll do with it when my eyes are closed.

~~~
btilly
Something to consider. It is only _your_ money because the rest of society
enforces rules that _keep_ it being your money. How, why and when should they
do so?

The problem with extreme libertarianism is that property rights fall apart
without the constant intervention of the legal profession, including
government run police. This requires more government and consent from fellow
citizens than most libertarians seem to want to acknowledge.

------
steveitis
1\. Why would you say it is 'unfair' of me to be able to decide who gets the
benefit of my lifes work when I pass on?

That's the rational. I earned it, so I decide who gets it. Usually my kids.
YMMV from country to country, and state to state yadda.

2\. Why not mind your own business. I worked for it, and I'll decide what to
do with it. If you'd like to decide the fate of vast wealth, than go earn vast
wealth.

3\. You could even have a system that prevents people from whinging about how
unfair life is on the internet whilst some people don't even have benefit of a
decent soapbox, but it wouldn't make much sense either.

------
jamesbritt
"in the interest of fairness."

How exactly is "fairness" defined? I see that word used in discussions of
social matters ("fair-trade coffee", "fair wages", "fair share of taxes") and
it's assumed that everyone is just going to have the same idea of "fair" (or
not bothering analyzing what the word is supposed to mean in the given
context), and think, hey, *fair", who could be against that? People use it,
but no one defines it.

It's like asking someone if they like good food or good movies without making
clear whose taste is deciding things.

The only interesting argument I've seen that argued against inheritance
asserted that once a person was dead they were no longer able to make any
claim on the money, nor was there any person from whom that money could be
taken; there's no owner; they simply not exist. Decisions made about property
while still alive had no bearing; when you're dead, you're out of the picture.
(It seems to avoid the whole issue of "fairness", too.)

What wasn't explained to me was how one goes from that idea to it being OK
then for the State to come and just take the wealth left behind.

------
noonespecial
Who chooses the charity? Inheritance is just one subset of the _what happens
to my money when I die?_ question. Maybe I'd like to give it to a charity,
maybe my children. Do I have that right or should some of it be confiscated
and used for something I likely wouldn't approve of explicitly? If so, how
much?

We've just chosen the default case to be one's surviving relatives, in order
of closeness, if a will doesn't specify otherwise.

Perhaps we should just change the default? Or raise the taxes? Making
"inheritance illegal" doesn't really have a practical meaning.

~~~
amichail
Instead of charities, maybe require that the money be given to the government.

Moreover, there would be a limit on how much money you can give to your
children while you are alive.

If you are poor, you would be able to get money to give to your children.

~~~
noonespecial
_> Instead of charities, maybe require that the money be given to the
government._

This is known as _tax_. We do this to inheritances already.

 _> Moreover, there would be a limit on how much money you can give to your
children while you are alive._

Very well, I'll buy from my son this fabulous vintage 1976 El Camino for the
modest sum of _one-meeelion-dollars_.

------
_pius
_What exactly is the rationale behind such an unfair concept?_

What's unfair about it?

~~~
amichail
Think about it from the children's perspective.

Why should their wealth be determined in part by something they had no control
over?

~~~
pbhjpbhj
It is. That is not what must be established. Why should a childs wealth
(usually in the West it is an adults wealth) not be determined by the success
of a past generation?

You need a pretty convincing argument here to change this particular aspect of
the status quo.

~~~
amichail
It is fundamentally unfair.

Granted people are not born equal to begin with, but adding more unfairness to
life isn't a good idea.

~~~
BrentRitterbeck
Haha! Life is not fair. It never has been. It never will be. I've stopped
worrying about how fair life is, and I, instead, try to make sure I'm not the
one getting screwed.

------
rlpb
Should giving gifts be illegal?

> What exactly is the rationale behind such an unfair concept?

What's the difference (in real terms) between giving a gift before you die and
giving a gift after you die?

> ...limits how much money parents can give to their children

Why are you singling out parents giving money to their children? If we want
the freedom to give gifts to whoever we please, we also must accept that most
people will want to give gifts to their children.

There is also the obvious evolutionary benefit if you consider the "selfish
gene" (Dawkins).

------
tjr
It's not unfair to give an inheritance to your children; it's unfair _not_ to.
But I can't make everyone else do what I think is right.

------
russell
My SO has serious medical problems. Shouldnt I be able to leave her the house
and some means of support. Most inheritances are fairly modest. Taking them
away would only hurt the majority with little benefit to anyone.

~~~
amichail
If someone is unable to work, then they can get money from the government.

~~~
pbhjpbhj
Do you advocate ruling out any giving of gifts beyond necessity, period?

If I earn money (or any asset really) and then gift it to someone does it
matter if I died between me earning it and them being given it?

~~~
amichail
_Do you advocate ruling out any giving of gifts beyond necessity, period?_

Yes.

~~~
nfnaaron
Then Christmas is gonna suck this year.

------
hga
Question 1: Is it your money, or the state's?

Question 2: Do you like the ideas of the family farm and family small
business?

Question 3: What about life insurance for families?

------
jganetsk
I thought this was a question about programming.

And yes, I think inheritance in programming should be illegal.

------
roundsquare
Here are a few reasons I disagree with you. Let me know what you think.

1) The point of gathering wealth is to somehow make yourself happier. Without
this, wealth is meaningless. One of the things that make many parents happy is
the knowledge that their kids will be well off. If you take that away, you are
removing one method of achieving happiness through wealth.

Now, as a society, we do eliminate methods of gaining happiness through
wealth. E.g. we don't allow you (legally anyway) to use your money to hire an
assassin. There are other, less glamorous limits as well, such as limits on
what you can buy in the stock market, etc... Each of these limits has a reason
(or should anyway, if it doesn't, we should get rid of the limit) that relates
to harming society. You seem to be saying that the money could be better used
in other ways by the government. Although I question if the current
incarnation of government would do so (in any country) I'll grant the premise
for now, but still disagree.

I disagree because not only is making one's kids well off one way to gain
happiness through wealth, it is a hugely significant way for many parents. If
you want to change the inheritance laws, society needs to weaken the
connection between parents and children, something which I don't believe would
be a good thing.

2) You seem to think of inheritance as money. Its not just money. Inheritance
is also property and rights (and other things? I'm not sure). With your
system, after a few generations the government would own everything. Sure, we
could find a way to have the government disperse these properties and rights,
but this would be a very cumbersome system that would need to be frequently
implemented and its unlikely to produce fair results. For example, lets say we
do an auction when each person dies. How would people place bids? How can we
make sure everyone is allowed to place bids? How can we make sure the rich
don't use this to pick up things at way under market/reasonable value because
they happen to be awake during the bidding process? Etc... You can probably
create a system that solves the questions I asked, but it would be cumbersome
and difficult to manage.

The problem is even worse with rights. Lets say I own some long term debt...
i.e. I have the legal right to receive cash from a someone periodically over
the next 20 (say) years. Now, if I die... who gets the rights to that cash?
You want to auction that off as well? Who even knows I have that right? I may
have it written down, but it may just be an informal contract with someone.
This can be a problem even now, but with wills, people will want to write it
down for the sake of their children.

3) In reality, I don't accept your premise that a governing body would do a
better job with the inheritance. We see now that so many government programs
are a waste (even though many are a success. I'm not being anti-government
here). Do we really want to trust some body to use this money? This leaves so
much room for error. Also, there are individual/family needs that won't be
taken into account. The sick significant other is a big one (mentioned by
@russell) and I'm sure there are more.

4) Think of how weird the situation is. Say you save up for your kid to go to
private school or college. If you stay alive during that period your kid gets
through it without debt. But, if someone hits you with a car, suddenly your
kid will need to get loans? That doesn't make any sense. To reconcile this,
either you need to do what you said and limit what kids can get while the
parents are alive, or allow inheritance.

Lets say we go with option 1 (limiting what kids can get while alive) and say
the private school is a religious school. Now, the parents are sending their
kids there because they want to instill certain values. So now, we are
limiting the parents rights to instill these values? This is not something
that should happen in a free society.

Just some thoughts...

------
ddemchuk
If you don't like capitalism, move somewhere that doesn't use it as their
economical system so life can be more "fair". You might not like that kids get
their parent's wealth without technically earning it, but that's the nature of
the game. Want the same wealth? Go earn it. That's the beauty of capitalism.
The same reason that wealth was created in the first place is why you can also
get it.

~~~
amichail
Why is it "the nature of the game"? Why can't you have capitalism where you
create wealth for yourself and a safety net for everyone?

~~~
BrentRitterbeck
Because I'm not breaking my back for the benefit of others. Hell, half the
time I wonder why I am doing so much work for myself and my family.

~~~
amichail
Your money doesn't have to go to the government after you die. You could spend
it on yourself taking advantage of your doctor's prediction as to how much
longer you will live.

~~~
BrentRitterbeck
Life often ends unexpectedly. I seriously doubt I could time the cash flows to
expire at the exact moment I expire.

EDIT: I am absolutely certain I could not time the cash flows to expire at the
exact moment I expire.

