Sen. Chuck Grassley issued a statement on Monday intended to clarify his recent defense of repealing the estate tax as a way of rewarding people who invest money instead of “spending every darn penny they have” on “booze or women or movies.” Grassley’s comments caused a firestorm on social media over the weekend, with people accusing the 84-year-old senator of being out of touch with reality.
In a written statement provided to Business Insider, Grassley said,
My point regarding the estate tax, which has been taken out of context, is that the government shouldn’t seize the fruits of someone’s lifetime of labor after they die. The question is one of basic fairness, and working to create a tax code that doesn’t penalize frugality, saving and investment.
The estate tax is a 40 percent tax assessed on personal assets an individual bequeaths to others upon his or her death. There are standard exemptions of $5.5 million for individuals and $11.1 million for couples. According to an analysis by the nonpartisan Tax Policy Center, only 5,640 estates in the United States will have to pay the tax in 2017. “Over two-thirds of these taxable estates will come from the top 10 percent of income earners and close to one-fourth will come from the top 1 percent alone,” the center said.
The current Senate tax bill, which Grassley voted for, repeals the estate tax. The senator has long held the position that the tax should be eliminated, claiming it is a heavy burden on family farmers in Iowa. But the facts don’t support this claim, according to both academic and government sources.
According to estimates contained in a 2015 report by the Congressional Research Service, only 65 farm estates nationwide pay anything under the estate tax. In Iowa, it is estimated that it is only once every two years that a farm estate faces any estate tax liability. Kristine Tidgren, the assistant director of the Center for Agricultural Law and Taxation at Iowa State University, told the Des Moines Register that she’s not aware of any Iowa estates forced to sell land since the estate tax exemption was raised to its current level in 2012.
Grassley has repeatedly brushed aside such facts over the years, as he pushed for the repeal of the estate tax, but never publicly framed his argument in the terms he used during a recent interview with the Register.
In the interview, Grassley defended the Senate’s latest attempt to repeal the estate tax by saying, “I think not having the estate tax recognizes the people that are investing, as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.” The quote was quickly picked up by social media users after it was published in a Dec. 2 Register story.
In the interview, Grassley at first conceded his own farm is unlikely to be taxed under the estate tax, but then changed his mind and said it might be taxed in the unlikely event that both he and his wife died on the same day.
Despite Grassley being a millionaire, his assets are unlikely to be subject to the current estate tax. Using information from 2014 financial disclosure forms, the government transparency organization InsideGov estimates Grassley’s net worth at $3.76 million. According to InsideGov, “Grassley’s net worth was 3.5 times more than the average member of Congress and 37% more than the average senator. When compared to the Iowa Congressional Delegation, Grassley had a net worth that was 576% more than the average.” Grassely is the second-wealthiest member of Iowa’s Congressional Delegation, and the longest serving member of the delegation, having been first elected to the House of Representatives in 1970, and then elected to the Senate in 1980.
The wealthiest member of Congress from Iowa is Rep. Rod Blum. InsideGov estimates Blum’s net worth at $15.4 million.
