Introducing America’s Inheritance Bank

A way of funding government without annual taxation

Make Money Work for All People; Not Just a Handful at The Top!

A Short Skip — 100 Years of Presidential History

1921 saw three successive Republican presidential administrations (Harding, Coolidge and Hoover), functioning as servants of a cumulative Robber Baron oligarchy, bring on The Great Depression. The response became Democratic President Franklin D. Roosevelt’s progressive economic policies which gave birth and rise to The American Dream which rescued and lifted the boats of ordinary working people.

The moderate presidential administrations of Harry Truman (D) and Dwight Eisenhower (R) did not severely tamper with FDR’s dream and unions remained strong. However, when progressive Democratic President John F. Kennedy wanted to expand and build upon FDR’s democratic-socialist policies, he got shot.

His vice president, Lyndon B. Johnson, followed nurturing some of the seeds from JFK’s New Frontier policy which included the civil rights and voting rights acts. LBJ even declared a War on Poverty. But this never came into fruition because The Vietnam War became greater in prominence.

LBJ made an Appalachian cameo on The War on Poverty

Pretty much, JFK’s assassination became the end of Progressive America.

Oligarchy had been rearing its ugly head via underlying economic policies emanating from The Military-Industrial Complex, the rise of which JFK warned about. Whereas JFK wanted to end the Vietnam conflict, LBJ — a military hawk and friend of Texas oil tycoons — expanded it into a full-blown war. This set the table for hardcore GOPwinger Richard Nixon’s cruel presidential power — say hello escalation of Vietnam, and to America’s Drug War!

Following JFK’s assassination America transformed from a land of opportunity into a land meant only for the growth and preservation of oligarchy, i.e., the upper 10% ‘la crème de la crème.’ When the pro tax-cut/pro trickle-down war hawk presidential administrations of Ronald Reagan and ex-CIA chief George H.W. Bush had finished, oligarchy had a very firm grip over government, the courts, the diplomatic corps and certainly over all Americans.

The impeachment over Democrat Bill Clinton was not about a real estate deal gone awry or a stained blue dress, it was about severely weakening his administration. Clinton’s administration dutifully deregulated the FCC to enable media monopolization; repealed Glass-Steagall (originally meant as a response to The Great Depression) which freed banking to once again speculate; expanded sanctions as a means of foreign policy; inspired creation of a privatized prison system; and helped to militarize policing in America’s communities.

Meanwhile, America’s Drug War raged on and more and more Americans began living doubled and tripled-up, or homeless, within an underground economy. A suspect 2000 presidential election saw the Bush-Cheney Administration worsen everything for ordinary people, both domestically (bankruptcy laws and tax cuts that favored the wealthy) and abroad as America proceeded to destroy the Middle East with wars and a perpetual enactment of bombing campaigns continuing to this very day.

Presidents Barack Obama (supposedly a populist for the left) and Donald Trump (supposedly a populist for the right) came into power and oligarchy kept obscenely profiteering. Under their respective presidential administrations 85–95% of all new wealth created went to the fat cats at the top! Despite their claims of populism, like the others since JFK was shot, they governed as tools of oligarchy.

Today, America’s Military-Industrial Complex has become America’s Military-Media-Industrial Complex as five corporate conglomerates now control 90% of all media. A free press, of course, has always historically been thought of as the last line of defense for the people. Meanwhile, America’s unions were decimated, privatization reigned and both political parties kept feeding their respective oligarchs.

America, today, looks like what’s described below:

There you have it! All described in one paragraph!!!

So, Let’s Talk About Taxes!

First of all, we should accept the fact everybody hates taxes … except, temporarily, those who get paid to do them. But then they hate ‘em also since they, too, must pay their own!

Secondly, everybody enjoys free. This includes those down on their luck who don’t have much, those who become generationally wealthy and even those who claim they’re working hard for what they earn. After all, those with nothing need free to survive. If the very rich didn’t enjoy free why would they go to great lengths to establish offshore tax havens and hire accountants to get greater tax cuts? And why do those who work hard normally play the lottery, buy scratch tickets or enjoy winning the meat raffle?

Thirdly, we should never lose sight of the greatest gift ever provided an American citizen: the opportunity to experience The American Dream — and this includes the freedom of choice!

Ironically, oligarchy’s cruel adherence to blatant capitalism once proved a great failure. It was out of the recovery from this failure that The American Dream was created. Once this Dream was established, it never should have been taken. It never should have become lost! Sadly, today, our American Dream is dead in the water!

So how do we get it back?

Below is a unique proposal to run government without taxation. It’s an idea to help assure money is better spent within the American economy. It’ll also help eliminate those who rely upon offshore tax havens where obscene amounts of money gets hidden away, thus becoming unproductive to our American economy.

The Inheritance Bank: How It Works

I propose that after a deceased individual gets the nod to enter Heaven or becomes required to try and change Hell for better or worse, that their worth value should immediately enter what I call The Inheritance Bank (The Bank).

[NOTE: I recommend for doctoral students this could become a perfect research thesis: Crunch the numbers, fine-tune the details — see if it works!]

The net worth of an individual, by age 21, must be determined by professional actuaries and then continually updated (annually, bi-annually, every five years, however determined) as their life continues onward. It’d be like periodically renewing a driver’s license. In this case, you’d simply be declaring your wealth. At age 21, each individual must open an Inheritance Bank account and that individual must assign an executor for their will.

When the individual dies, The Bank works with the appointed executor of the estate to determine the overall wealth value of the deceased (property, stocks, money in the bank, etc.) and then determine an inheritance formula for distribution to the heirs of the deceased.

The value of any individual’s worth is exempted up to $200,000 (to be determined). So if a deceased holds a value $200,000 or under, their heirs need not worry about anything, except the normal functions of an executor of a will — when an individual dies and their total worth is $200,000 or under, they can bequeath the entirety of that amount to their designated heir(s) for all-time keeps — they can take the money and run, not worry about anything in the future. However, the heir must renew their own changed wealth value to The Bank.

For someone who dies with a higher worth, let’s use the following example: If the estate value is determined as one million dollars and two children are designated as equal heirs. First, upon death, the one million goes directly into The Bank. Deduct $200,000 as a waiver to help ease transitional needs (administrative, funeral, relocation costs, etc.). For example, nobody gets kicked out of their home. So with an estate value of one million, the first $200,000 is exempt.

Thus, each of the two heirs would immediately receive $100,000 from The Bank. The remaining $800,000 temporarily remains in The Bank. Once all legal financial interests of the deceased are settled, each designated heir then receives their half of the remaining $800,000. But this is provided to them as a loan, which they must pay back before they die.

In effect, both heirs ultimately receive $500,000: $400,000 of which remains accountable to The Bank; and $100,000 as a direct bequeathed gift. They are free to do whatever they like with the $500,000.

If the heir recipient, when they then die, wishes to bequeath money to their children (the originally-deceased’s grandchildren) the original heir recipient must first have repaid the originally provided $400,000 back into The Bank (full payment or partial payments can be made over the course of the first heir’s lifetime, until the full original $400,000 loan becomes settled).

If when when the first heir dies and they’ve paid back nothing to The Bank, then the first $400,000 of their settled estate value at the time of their death, goes directly back into The Bank for The Bank to keep. Any amount the original heir has above the $400,000 will be distributed according to the Inheritance Bank guidelines (including the $200,000 exemption). In short, one must pay back to The Bank what they received from their original inheritance (minus the free waiver).

In other words, if you were originally bequeathed a $400,000 loan, and you failed to pay any of this amount back into The Bank over your lifetime, and you then die with an estate value of $700,000, the first $400,000 of that amount becomes forfeited and goes directly to The Bank as payback. This means only $300,000 would be available for the next-in-line heirs.

So this leaves $300,000 of bequeathed value remaining, $200,000 of which is exempted. This means if you have two next-in-line heirs, from the $200,000 exemption, $100,000 automatically would go to each. The remaining $100,000 would be divided as the loan and each heir would receive $50,000, which they would be required to pay back to the Bank before they died.

The process repeats and continues over the generations. Most ordinary people are not affected by this system due to the $200,000 waiver (or whatever amount the waiver is best determined).

If any money, for whatever reason, is held in an offshore bank account to avoid disclosure, at the time of death that money immediately becomes forfeited to The Bank and it would become illegal for any heir to receive any of it. Upon presentation of a death certificate (by The Bank, the executor or the heir) to the offshore bank the deceased’s money in that account goes directly into The Inheritance Bank.

Benefits Analysis:

  • Interest generated from money in The Inheritance Bank would be enormous and likely sufficient to run the needs of government, without any need of an Internal Revenue Service system. Just imagine government running with the wealth of a Walmart family member or Bill Gates or Jeff Bezos locked into the system.
  • This system only applies to those who hold wealth in excess of $200,000 (again, amount to be determined) at the time of their death. Poor folk and struggling working people, who can not afford bookkeepers or tax consultants, would function as they normally do under the current system, whereby an executor is appointed and the bequeathed monies get assigned to heirs are as they do today .
  • Because the amount of money inherited must be repaid by the end of a lifetime, a positive incentive is created for heir recipients to make productive use of their originally bequeathed money. This would help to churn a healthy and productive American economy as inherited money would become wisely spent, not hoarded and taken out of circulation as often happens today.
  • The option always exists to just take your inheritance money and run, pay nothing back. If you have no children or anyone to whom you wish to bequeath your fortune, this might become your best option. Indeed, live your life on a merry-go-round! But when you die, and you have no assigned heirs, ALL of your wealth and assets go into The Bank.
  • Here is one of the gems of the plan. One no longer becomes born on third base or instantly scoring a run out of the uterus. An Inheritance Bank has the potential to gradually wear down The Silver Spoon Effect whereby famous family fortunes get passed on — tucked into offshore tax havens — to an heir who’ll only hoard the money. Horded money is counterproductive money and no help at all to the American economy, or for helping to improve the society in which we live.
  • The incentive to go out and create a fortune remains every bit as strong as The Inheritance Bank requires receiving only that which was originally given and it recycles that money back so everyone has a fair opportunity to do well. Think of it as recycling money rather than taking money.
  • The incentive to hide money in offshore banks accounts to avoid taxation becomes eliminated as any such money horded runs the full risk of becoming completely forfeited.

According to Wikipedia when this was written, half of the world’s wealth belongs to the top 1%, the top 10% holds 85% while the bottom 90% hold the remaining 15% of the world’s total wealth. The top 30% hold 97% of the total wealth. The combined wealth of President-elect Donald Trump’s 17 cabinet members, including the vice president and chief of staff, is 9.5 billion and greater than one-third of all American households.

I don’t know how the numbers ultimately work out. My theory is completely untested, unvetted and perhaps more instinctive than anything. I also know that statistics are like a bikini: What they reveal is interesting but what they conceal is crucial. Also, my baseball coach was my math teacher — always got a near-automatic C-grade in math. So do the numbers work? I don’t know.

Nonetheless, I think I’ve developed a blueprint requiring deeper analysis, especially if it becomes possible we could run the United States government from an Inheritance Bank and not from IRS taxes. Call it my bid to make taxes disappear while at the same time addressing the serious problem of income inequality.

This could become a new system for a better-balanced society, one with less reliance on the economics of privilege and one that provides opportunity for everyone, where those who work hard actually are rewarded. Who knows, perhaps it would help bring back The American Dream since there would become greater opportunities from the use of money.

PS: Again, I’d love to see a doctoral student, a statistician or actuary grab this ball and run with it — see where it lands!

Additional Reading:

Disney Heiress condemns greed:

Charts on Wealth Inequality:

NOTE: The original version of this was as a Facebook Note. However, sadly, Facebook decimated Facebook Notes and a lot of good work became lost or reduced in style and content.

Founder of Climate Change Band; former NH State Rep; Supporter of Bernie Sanders & Standing Rock!