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Free Soil: The Aggressive Progressive Answer to the Problem of Family Farms and the Estate Tax
Stirling S Newberry stnewberry@earthlink.net

On June 19, the Senate failed to join the House in permanently ending the estate tax. Even Republicans stumbled over the party line that it is a "death tax" - after all, you can't tax a dead person, they don't own anything. All the while the argument was that this bill was to protect, "family farms". This scare tactic is at the heart of the sales pitch for George Bush's Necronomic policies.

My grandfather knows what to call sales lines like that -he used to spread it on the fields every spring. He could tell you why the family farm that his grandfather and Cherokee grandmother built up was finally sold. It had nothing to do with inheritance taxes. Instead, the skyrocketing costs of medical care, and the plummeting agricultural prices that the 'Phants "Freedom to Fail" policies wrought were the reasons why, 40 by 40, the farm was sold off. Each time a sister or brother got very ill, another parcel was sold. Relatives with scant claims on the land fought a long, expensive court battle to try and claim the most valuable sections, and the cost of prescription drugs ate away and fixed incomes.

Our economic policies have funneled the vast majority of agricultural subsidies to big agri-business, meanwhile discontinuing programs that had been created to protect the agricultural infrastructure of the nation. The ability to feed ourselves was recognized as a national security interest, and FDR made it explicit in the New Deal: he argued as Governor of New York, and then as a presidential candidate that a population imbalance between city and country would back the former into unlivability, and deplete the later of life and existence. This growing squeeze has made many people want to leave the land, many whose families pioneered to the Great Plains are watching young people leave, crop prices wither, and communities vanish. They are upset, and have latched on to yet another snake oil job by the Republican Party. The only way to counter this isn't with platitudes about billionaires alone. The way to counter disinformation from the 'Phants is to look at what is frightening people, and finding a sensible way to combat it.

"A sensible system, sensibly trusted by sensible people." FDR would say. When scare mongering raises its head, and fear itself is used by entrenched interests as a weapon to herd people into a poor decision, it should be the weapon of choice. Not trying to come up with a less extreme version of the Republican scam. But asking ourselves - what would Ickes do? What would Truman do? What would JFK do? Because in a Liberal Democracy, every deal must be a fair deal, every deal must be a square deal, and every deal is a new deal.

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The real threat to the family farm isn't the estate tax; instead the twin ravagers of the family farm are the cost of being old, and the spread of suburban sprawl. The first is a general problem, and a great deal has been written on how to solve it. Suffice it to say that 20% increases year over year in health insurance costs, fraud and insider trading by biotech executives, and the lack of drug coverage are merely the headliners on the ways Americans are being shaken down. The second however is a more specific problem, and needs a more specific solution.

Under the Republican agricultural policies, many agrarian counties in the US experienced a net decrease in population. Towns literally withered. According to the most recent census, there are more counties classified as "frontier" - based on population density - now, than there were at the turn of the century. And yet, republicans are engaged in a series of scare tactics, to convince owners of family farms that the tax man will take generations of work.

Faced with the difficulty of making a living farming, how can so many people be worried about paying estate taxes?

As population grows, as sprawl grows, and as housing prices skyrocket, land once far from the center of a city has become prime "development" land. While some people have seen their counties empty out, many other places have seen tendrils of cul de sacs spring up almost overnight. Land once valued at the price of agricultural land is suddenly worth, at least on paper, the number of "buildable lots" which could be put on it. The Republicans argue for a raid on the Social Security surplus is based on the fear of having to come up with enough to pay taxes, not on what a family farm would be worth, but what "Argosy Acres - 4000 sq foot houses starting at 200K" would be worth if someone decided to buy it. Never mind that it probably never would be, and the developability of most of the land is questionable - it is the fear, nameless unreasoning fear that somewhere down the line some faceless tax official might decide that it could be built, that the 'phants fuel, and well meaning people have been caught up in.

We owe it to the American farmer the chance to make a living without being taxed out of the ground he walks on, we don't owe it to a land speculator to make a killing without paying a dime in taxes, regardless of what he used to do. Let us look at this realistically. If the family wants to be able to sell land for $100,000 a quarter acre to developers, that is their business. But at that point one cannot say that they are preserving the American family farm.

What's the solution? How do we protect a way of life - while not allowing it to become a Trojan horse for necronomic policy? There is a simple way to do this, which is legal, easy to put into effect, and is an extension of programs already being tried. The simple way is to create a trust for development rights. The estate would deed its development rights to a government trust, similar to the way agricultural quotas are used today. The trust would have to pay for development value for the land to the heirs if the government used eminent domain to build on the land, or any other project that would render the land unfit for farming. The heirs would then get - a family farm. If they wanted to buy the development rights back from the trust, they could - at fair market value. The right to buy the development rights would "run with the land".

This would protect the family farm as a family farm. It would prevent the heirs from paying estate taxes on all but the largest of farms, which, if American agriculture has been that good to them, they should not object to giving something back to a society which has made preservation of the family farm a priority since the New Deal began. The trust would be easy to administer, it would require little new legislation, and would fit in with existing farm programs. Moreover, such a trust could be extended not only to family farms, but also to other environmentally sensitive properties - land that is used for grazing or forestry could benefit from the same provisions.

Thus, if we were being honest, the "Development Rights Trust", or something like it, would be the proposal coming from the Democratic side of the aisle. Such trusts have been set up by private individuals - but they actually buy the rights. Which means money, which is taxed. If the individual wants the money, so be it, let him pay taxes on it the same way I would pay taxes for Xerox stock that has been in the family for a long time. If he wants to keep his family farm as a family farm - then I am all in favor of setting up a mechanism for that to happen.

Coupled with this could be a federal clearinghouse for family farms for sale. That way those people who want to leave the land could do so more easily, because others seeking to escape the noise and density of the city could more easily find such a property. Indeed clusters of undevelopable farmland would be an attraction, knowing that one is not going to have the green across the way knocked down for a shopping center next year.

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It is solutions like this that Democrats used to be known. Sane, sensible, straightforward. Get to the heart of the problem and ask a simple question: "How do we protect the honest people trying to make a living, without opening the chicken coop to the fox trying to make a killing?" By asking what is the real problem, the real solution presents itself rather quickly. It is time that Democrats in the Senate stop behaving like the "slightly left of right wing" party, and start thinking like Democrats again. Its all well and good for Senators to make speeches about how repealing the Estate tax is bad policy and a give away to billionaires - but they also need to come up with an effective proposal to remedy the problem that the Republicans are using scare tactics to exploit.

And just to remind people - getting decent drug coverage so that old maiden aunts wouldn't have to sell off the family farm one illness at a time wouldn't hurt either.