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I'm not sure what your point…

I'm not sure what your point is. If they are illiterate and can't figure out how to write their name on the signature line of a document prepared by a tax professional, then how did they figure out the dramatically more cumbersome and involved documentation associated with enrolling in school and accepting a scholarship in the first place?

 

No, the laborers getting…

No, the laborers getting compensated in the amount of a tiny fraction of the value they create is where we draw the line.

It was totally cool when college football was a competition of who has the largest number of wealthy donors willing to throw cash at coaches, stadiums, and facilities, though. Just can't stomach the idea of giving some small cut to the people who actually do all the work. 

Sure but this stuff is super…

Sure but this stuff is super simple and the service providers the schools are contracting with are very good. Plenty of young adults figure out their taxes just fine, and they do it without the help of a team of CPAs and tax lawyers who specialize in their unique mode of compensation. 

What will happen if some…

What will happen if some ultrawealthy booster decides to ignore the advice of their advisors and make a massive gift (say, $2 million) to a star football player at their favorite university in exchange for an autograph is that the IRS will assess a $800,000 gift tax on the gift, plus a penalty for failure to report (or worse, a penalty for fraud, depending on the facts and circumstances). If the taxpayer wants to appeal it and argue that it was a "sale," not a "gift," then the taxpayer will have the burden of proving that the autograph is worth $2 million. The taxpayer in that scenario will not be successful in convincing any tax court in America to accept their position. Lawyers and CPAs everywhere will tell their wealthy, sports-obsessed clients, "told you that would happen."

Bonus: If the NCAA catches wind that the player received a gift from a booster, they may suspend the player.

So now you've spent something in the neighborhood of $3,000,000 (the $2 million gift plus $1 million in taxes and penalties) on a star player for your alma mater who will be sitting on the sidelines, not playing, because he's ineligible under NCAA rules.

The definition relates to a…

The definition relates to a hypothetical buyer and a hypothetical seller, neither under any compulsion to buy, and both having reasonable knowledge of relevant facts.

If I buy a house at its appraised value of $25 million and then immediately turn around and "sell" it to my son for $250,000 in an attempt to have the transaction characterized as a "sale" rather than a "gift" in order to shirk the $10 million gift tax that would otherwise be imposed, my argument (the house's fair market value is $250,000 because I am a willing seller and my son is a willing buyer and that is the price we agreed upon) is going to fail. The IRS is going to recharacterize this as a part-sale ($250,000), part-gift ($25 million less the consideration paid).

That is what is happening in most of these fantasy scenarios where ultrawealthy donors are "buying" things from student-athletes for ridiculous prices plus a wink and a nudge.

Obviously, intangible assets like name and likeness rights are more difficult to value than something like a house. But "difficult to value" does not mean "assign whatever value you want and that is the fair market value." The IRS has approved methods for NIL valuation. If some billionaire donor tries to "buy" an autographed football from a star quarterback for $2 million and argue that there should be no gift tax liability because the fair market value of the autographed football is whatever the billionaire was willing to pay for it, that billionaire is unquestionably going to lose that argument against the IRS. 

If signing a document is too…

If signing a document is too hard for them then how did they get enrolled in school in the first place? 

The students won't have any…

The students won't have any problem with taxes. Most universities are partnering with independent third party firms staffed with service providers like attorneys, accountants, and marketing professionals. The students will have to sign the dotted line. 

Hell, the paperwork you have to fill out to enroll in school and receive your scholarship is more cumbersome than taxes. 

One recruit sold an art…

One recruit sold an art project from class for six figures. He's an Aggie. 

Sounds like total nonsense. Transactions like this would be characterized as part taxable gifts. Gifts are still impermissible benefits under NCAA rules. Very few high-net worth individuals are going to have any interest in making extremely tax-inefficient transfers of wealth (the gift tax rate is 40 percent, tax exclusive) for the benefit of their favorite college football team with a high degree of risk that the transfer actually hurts the team if the player is deemed ineligible or other sanctions are imposed on the program.

What TAMU is actually doing is organizing and streamlining the NIL process. They have established that each recruit will get an average of $200,000 to $300,000 in exchange for the commercial use of their name, image and likeness. They have organized the alumni base to ensure that this promise can be fulfilled by creating independent legal entities with partnership/operating agreements/bylaws that carefully spell out how the entity is capitalized and how it will expend its capital. That is much more efficient than hoping wealthy alumni and/or student-athletes will source their own deal flow, conduct their own due diligence, avoid conflicts of interest, and so on. 

Yeah, imagine if the same…

Yeah, imagine if the same one or two teams got all of the best recruits every single season for more than a decade straight. Can you guys just imagine how terrible that would be for college football?

Looks like I was right. 

Looks like I was right. 

Bingo.

There is way too…

Bingo.

There is way too much money involved here to allow some sort of objective, viewpoint-neutral methodology determine the rankings when the rankings determine matchups and the matchups determine entertainment value (and therefore revenue).

The whole point right now is to inflate big names and incite controversy. 

They did. The B1G made their…

They did. The B1G made their press release that the refs changed the result of the game and the CFP committee shortly followed up with an immediate press release yesterday saying that they were going to take that under advisement going forward with the rankings. Given that both the B1G and CFP committee have officially acknowledged that the refs changed the outcome of the game, I expect Michigan to be ranked higher than Michigan State in the Week 11 Playoff Rankings. 

This whole thing is…

This whole thing is manufactured trash and the borderline illiterate portions of both fan bases are swallowing it hook, line and sinker. 

Harbaugh didn't come into the press conference looking to talk about Michigan State. He was directly prompted about the officiating. It was pretty benign. 

Tucker wasn't even asked about the officiating in the Michigan game. MSU was on the wrong end of about a dozen or so calls/non-calls in their loss to Purdue. The reporters were practically begging him to complain about the officiating.

But they have successfully manufactured the narrative that Harbaugh was still complaining that the refs gave the game to MSU two weeks later and Tucker is calling Harbaugh and Michigan soft for complaining about the refs. Even though none of this is even close to what happened.  

Nope. Sparty's pass defense…

Nope. Sparty's pass defense is decent. 12th nationally in yards per attempt. Top 25 in TD/INT ratio and Opposing QB Rating. They keep everything in front of them. They give up lots of short and quick, easy passes for little gain.

We will wear them down and overcome their D w/ a combination of short, quick, easy passes forcing them to stretch horizontally, and manball between the tackles w/ Haskins. Once we have them in submission, we may see a backbreaking over-the-top pass or Corum long rushing touchdown. 

Literally nobody is asking…

Literally nobody is asking for these absurd extremes. They would just prefer a society where quality of life is not determined almost exclusively by what socioeconomic class you were born into, and where opportunities to take risks and earn rewards are distributed at least somewhat equitably. 

LOL, no. The LSAT is purely…

LOL, no. The LSAT is purely a matter of practice and it is a major gatekeeping device. I took a diagnostic test during undergrad and scored around the 78th percentile mark. I lived at home for two years after graduating while working part-time to pay for an LSAT tutor, devoted all of my free time (and thousands of dollars) to LSAT prep, scored in the top 0.8 percent on the official test, and that got me a full-tuition scholarship to law school.

Plenty of LSAT-takers who do not have the privilege of living at home for free w/ their parents, working only part-time, and enlisting a tutor while devoting their life to LSAT prep are more or less forced to accept a score dramatically lower than their potential. The result is that they have to go to a school that does not create elite employment opportunities, and they have to take out hundreds of thousands of dollars in loans to do it.

The LSAT is a good way to ensure that fortunate people like me get the best opportunities at the lowest cost without regard to actual capability or work ethic. 

Probably because established…

Probably because established interests have made it all but impossible to "work[] our way up through the ranks," and all but impossible to fall down in the "ranks" if you are born at the top.

Inequality would be easier to stomach if socioeconomic mobility existed. The reality of modern day America is that people born to poor families will almost always end up poor no matter how hard they work, and people born to wealthy families will almost always end up wealthy no matter how little they work. 

Attend the games. I reffed…

Attend the games. I reffed at the college level. It never ceases to amaze me how many blown calls and missed calls you will see at the major televised D-I level that you do not see at the lower levels. People throw out all sorts of excuses for this but the fact of the matter is that the officiating is just objectively awful when the entertainment value of the game is an important factor.

College sports are…

College sports are entertainment and there is a wild amount of money on the line. Even if officials aren't trying to influence the outcome of the game, I think they recognize that it is implied in their job description that they will maximize the entertainment value of the game.

I'll ask this--do you think Judge Judy calls things the same way your typical circuit court judge would call them? Obviously not. 

I think this is why you see a lot of wonky officiating in big-time college sports. Especially CBB. I think you are more likely to get the contract to work the Final Four if your officiating helped the 11 seed take the 2 seed to OT in the Elite 8. On the other hand, if you have an early season game b/w Michigan and Prairie View A&M where 99.9% of the people tuning in are there to see Michigan, there is little incentive to keep it close--you're probably going to get more entertainment value by calling the game so as to let Michigan blow the lid off the stadium. This might also explain why there is so little consistency in calls from game-to-game and even half-to-half. 

I don't think this is some type of full-blown conspiracy theory like "the refs want Ohio State to win!" It's more like, there is an unstated expectation that you will maximize entertainment value--otherwise, you're not getting the good contracts. What maximizes EV might change given different facts and circumstances. You get it wrong and you end up working Rutgers vs. Lehigh instead of Michigan vs. UNC. The people assigning the contracts get to cloak it in the exceedingly subjective (and far from transparent) idea that the guy who got UM-UNC was just officiating "better" than you. 

If you're skeptical about this, just go watch D-III basketball. Hope vs. Albion. The officiating is 10x better and remarkably consistent in comparison to televised CBB. It makes no sense that the officiating is THAT much better at the non-televised levels. The most obvious explanation is that when there is a ton of money on the line dependent on entertainment value, games are officiated differently. 

IMO the game of football can…

IMO the game of football can mostly be distilled down to net yards per play and net points per drive. These things are normally very highly correlated, but they tell an odd story when you compare MSU and UM.

So far on the season, MSU is averaging 7.45 yards/play and allowing 5.10, net 2.35. Michigan is averaging 6.50 yards/play and allowing 4.90, net 1.60. That is a fairly substantial difference. (Ohio State, by way of example, leads the conference with net 3.2--MSU is second.) 

But interestingly, MSU is only averaging 2.73 points/drive while allowing 1.70, net 1.03. Michigan is averaging 3.44 points/drive while allowing 1.22, net 2.22. That is a fairly substantial difference as well.

Against Nebraska and Rutgers, MSU netted 4.0 yards/play and +0.99 points/drive. Michigan netted -1.3 yards/play and +0.95 points/drive. 

Not sure this tells us a whole lot, but it seems to support some takeaways and imply some things: 

  1. MSU's offense is quite explosive.
  2. MSU's defense gives up more yards but does a little bit better keeping opponents from scoring. 
  3. We are doing a better job in the field position battle. 

Caveat: We have had a more difficult SOS by a fairly substantial margin. 

There is literally zero (0)…

There is literally zero (0) chance that two B1G teams make the Playoff and one of them is not Ohio State. Sorry - doesn't matter how good MSU is (or anybody else for that matter). The only way Iowa is getting into the CFP is by winning the B1G, and there is simply no way the selection committee is going to be swayed to select a Michigan, Michigan State, or Penn State team that did not win its conference. Even OSU would most likely get left out in that scenario, although the brand and reputation would probably make the odds something greater than zero. 

The only way I could see two B1G teams getting in, and even this is a real stretch, is for OSU and Michigan to win out convincingly, w/ OSU beating Michigan by one score on 11/27 in a showdown of Top 4 teams, and then destroying an undefeated Iowa team in the B1G Championship. In that scenario you have a 12-1 Ohio State team that is pretty much a lock for the Playoff, and an 11-1 Michigan team w/ wins against MSU and PSU (who may both finish Top 10 or 15) whose only loss is to Playoff-bound OSU. W/ some chaos on the side, I could see those facts producing a two-B1G Playoff, and the odds are still incredibly low. 

They are already providing…

They are already providing guidance and monitoring who is doing what.

Speaks to the depth of the…

Speaks to the depth of the conference, IMO. 

Michigan, Illinois, and Iowa were all composite Top-10 teams last year and Ohio State was #13, w/ another four teams (8 total) rounding out the Top-40. The B1G was better than the second best conference by a massive margin last year. 

B1G basketball is elite right now. It wouldn't shock me at all if a team finishing as low as 8th in the conference was a borderline Top-25 team nationally. 

Nah. MSU's offensive line…

Nah. MSU's offensive line looked absolutely terrible. Reed and Walker are huge playmakers and can score any time they touch the ball but as we saw today it doesn't really matter how good the rest of your offense is if the offensive line sucks.

I think they'll have a big playmaker hit a home run against us at least once but aside from that they'll be going three and out all day long.

Their DL and a couple LBs look great in run D and good in pass rush. The corners look really bad and LBs as a group are not very good in pass D.

I expect to win that one in a snooze-fest, 21-10 or something like that. 

The NCAA is going to…

The NCAA is going to characterize it as a gift. 

You need to structure it as a commercial transaction because the rules only permit players to earn compensation in exchange for the commercial use of their identity. The commercial use needs to be reasonable in consideration of the amount paid, otherwise the alarm bells are going to start going off with the authorities. In other words, paying Corum $200,000 to make a single Instagram post saying "Darker Blue's Carwash is the best carwash in town!" is almost certainly not going to fly w/ the NCAA or the IRS. 

No. That would still be an…

No. That would still be an impermissible gift under the NCAA rules. 

Yeah, makes zero sense. 

Yeah, makes zero sense. 

"My girlfriend is wicked hot. You don't know her, she's from Canada. I can't introduce you to her...we're keeping the whole thing on the down low." 

I'm gonna wait to see if it…

I'm gonna wait to see if it benefits us or disadvantages us before deciding whether I like it 

Yup...makes absolutely zero…

Yup...makes absolutely zero sense. The value in using a person's identity for commercial purposes is based entirely on the publicity they can provide. That's why Olivia Dunne of LSU gymnastics with 4.5 million TikTok followers is making seven figures while the number 1 projected pick in the 2022 NFL Draft (Carson Strong, Nevada, QB) is making peanuts. Why would you be trying to "keep it on the down low?" That'd be kind of like trying to sell your car and then hiding the car in the garage and not telling anybody that it's for sale.

Hopefully Michigan is preparing to unveil some sort of innovative approach to maximize profitability for the players using NIL deals. 

Our run game was working…

Our run game was working just fine and Washington never adjusted. It's not like they stacked the box and slowed the run game and we couldn't exploit them over the top. They just kinda...rolled over and let us get what we needed on the ground. 

Also, until we had a decisive lead, it was clear that their offense was going absolutely nowhere. Why throw the ball and risk a game-changing sack or strip or interception when you can win the field position battle and slowly but surely put the game away w/ a conservative ground attack? I just don't see the need to introduce any risk when you are clearly going to win the game convincingly w/ a low-risk approach. 

Really concerned about the…

Really concerned about the coaching. We should be up 3-4 TDs right now. 

What a silly comment. Their…

What a silly comment. Their RB went for almost 300 yards last week including a 75-yard TD run on the first play of the game. A flea flicker is a pretty smart play there, and it resulted in a 75-yard TD pass on the first play of the game........

Who knows. The terms and…

Who knows. The terms and conditions of the arrangements are not public information. They just like to announce the deals because it makes headlines. 

From what I have seen, most of these deals involve scheduled social media posts, but to be frank, a huge part of the commercial benefit these companies are getting seems to be the headlines they make when they announce the deal. I would not have ever known what American Top Team MMA gyms are were it not for the waves they made after their NIL deal w/ the Miami football team was announced.

I suspect this novelty will wear off after a while, and NIL may settle down some when "Company pays X to college athletes for NIL under new rules" is not something that makes the front page of the news. 

Title IX relates to…

Title IX relates to discrimination by federally funded schools in school-based programs. This is a commercial transaction between two private parties. 

The law most certainly does…

The law most certainly does concern itself w/ fair market value determinations. I'm a tax lawyer. Valuation is the most frequently litigated issue in gift and estate tax. My colleagues in Hollywood could tell you more about the precise methodology the IRS uses to valuate intangible assets such as the right to publicity, which is a common issue in estate tax valuation for deceased celebrities--I personally cannot help you much on that, unfortunately, but I can assure you that the IRS can and routinely does determine FMV for commercial use of NIL rights. (Which makes perfect sense. Imagine the absurdity that would result if NIL was "worth" whatever the buyer asserted it to be worth. I could erase billions of dollars worth of estate and gift taxes for my clients with little more than an hour's worth of work. Sadly for them, it doesn't work like that.)

References. 26 CFR 1.1001-1(e). See e.g. Example 1 ("A transfers property to his son for $60,000. Such property in the hands of A has an adjusted basis of $30,000 (and a fair market value of $90,000). A's gain is $30,000, the excess of $60,000, the amount realized, over the adjusted basis, $30,000. He has made a gift of $30,000, the excess of $90,000, the fair market value, over the amount realized, $60,000.")

The easiest way to avoid devastating gift tax consequences is to avoid making personal, gratuitous transfers. Structure it as a corporate, commercial transaction, within a reasonable range of the likely FMV, and you will not likely attract IRS scrutiny. 

I would also expect many…

I would also expect many investors in United Wholesale Mortgage wanting a return on this investment. They can't all be Spartan fans who are happy for the company to throw money away.

That is exactly how we know these are legitimate advertising deals and not boosters throwing money at players for their favorite team. Ain't nobody risking a breach of loyalty, fraud, and other tortious conduct lawsuit so that the fourth string walk-on at their alma mater can afford a few dozen 30 racks of Busch Light every month. 

Agreed, and the…

Agreed, and the Entrepreneurship Clinic at UMich Law should be working overtime on this. Frankly, I am shocked that it isn't doing so already, because there are a ton of serious opportunities here, especially with new laws and regulations surrounding the capital formation process. 

Also, whats the manipulation…

Also, whats the manipulation of the NIL rule that allows a salary?

It's just a contract where amounts are paid monthly in exchange for some type of commercial use of the players' identity. The NIL rules don't say anything about whether payments must be made in one transaction. So it'd be perfectly fine to pay them $1,200 for a one-year deal, payable in 12 monthly installments on the last day of each month--or alternatively, $1,200 for a one-year deal, payable in 2 installments, one on the first day of each semester--or pretty much any other arrangement you can think of.

Some rich booster can pay each Duke player 1M a year (bball).  Then what?  

"Can," but won't, because the adverse tax consequences would be a disaster.

Are there no rules to this at all?

There are tons of inherent practical limitations in addition to those imposed by state law and NCAA bylaws and interim rules. Corporate law and the gift tax regime are two areas that severely restrict the manner and method of payments made to student-athletes. 

TBH, I think our situations…

TBH, I think our situations are a little bit different. 

MSU's huge donors are running Michigan-based publicly traded companies w/ huge advertising budgets. It makes a lot of business sense for them to arrange advertising deals w/ a huge in-state school that is affiliated w/ their founders.

Ross, e.g., on the other hand, is the owner of privately-held real estate development companies (that operate principally outside of Michigan) and owns (again, privately) the Dolphins. These are not really businesses that would benefit much, if at all, from advertising by UofM athletes. 

I think the reality of the situation is that these NIL deals are legit advertising deals that make business sense, and wealthy donors aren't really in the habit of throwing money at college athletes if it doesn't create a business advantage. (Donations to the school are significant tax deductions-not the same thing.) 

It is pretty clear that…

It is pretty clear that whatever the arrangement is, it needs to be as well-distanced from a personal, gratuitous transaction as possible. 

I don't think your proposed transaction would pass the smell test, although it would be interesting to see the NCAA grapple with it. Any company that pops up out of nowhere to funnel money to a student-athlete is going to be scrutinized closely. If the funding is coming from donations and the company's "advertising expenses" exceed its revenue, I think it's a pretty safe bet that the NCAA is going to characterize this as a pay-for-play scheme and not a bona fide, arm's length business transaction. 

To pass muster, the payments most likely need to be made by a legitimate business for legitimate business reasons and they need to be reasonable in light of the fair market value of the commercial use of the player's NIL.

If that becomes a problem…

If that becomes a problem then just put further limitations on the # of walk-ons a team can have on its roster. 

Doubt it'll become a problem though. How many guys want to walk-on in reliance on a NIL deal and be #86+ on the roster when they could go somewhere else where they'll get PT and therefore probably get a better NIL deal? 

What is the "sponsorship"…

What is the "sponsorship" for? 

It sounds like it's just a gift of some sort, in which case the wealth transfer tax rules apply, and there are probably more tax-efficient methods to capitalize on NIL opportunities. 

Generally speaking, as a…

Generally speaking, as a matter of intellectual property law, the owner of the IP has to vigorously assert their exclusive ownership and right to use and enjoy the property. Permitting others to use the IP is a big no-no, unless it's done through a proper licensing agreement. However, the NIL rules currently prohibit institutions from compensating players. So it appears the schools are stuck in a weird place here where they can't license their IP to the players nor can they permit the players to use the IP. I'm sure there is a solution but I don't know what it is. 

Again, the way the rules of…

Again, the way the rules of society are currently organized, we have tons of people who are born into so much wealth that they will never have to create any sort of value for society for their entire life, and neither will their children, or their children's children, or any of their descendants down the line for generations.

We can work together to come up with a reasonable limit (with reasonable exceptions) on the amount of wealth that can be transferred to family members. Above I proposed the median American's lifetime earnings, which is about $1.7MM. That seems like an amount of money that will provide you with the "safety blanket" you need to enjoy life while still requiring you to be a productive member of society. 

I'm a private wealth lawyer. I also run an investment firm and an incubator. If I inherited $1.7MM I would probably spend less (or no) time working for my huge firm, which services primarily huge corporations and ultra-wealthy clients, and spend more time and resources serving the entrepreneurs and innovative small businesses that come through my investment firm/incubator. If I inherited $23MM (which is the lowest end of the amount of money you can receive by gift tax-free--but it can range up to a potentially infinite amount of money), I'd probably retire immediately and pay other people to run my businesses for me while I travel the world.

Our wealth transfer policies currently preserve American plutocracy and undermine welfare and economic efficiency. They need to promote capitalism and democracy. We can do that through taxing and spending without unduly burdening the principles of liberty, freedom, justice, and so on. It isn't just about "equality." It's about creating and maintaining the best society the world has ever seen, and we are a long, long, long way off. 

Plutocracy is 100 percent…

Plutocracy is 100 percent counterproductive if your goal is to incentivize innovation and productivity growth. Huge corporations don't take huge risks. Neither do people who are ultra-wealthy. Neither huge corporations nor the ultra-wealthy encourage entrepreneurship--creative disruption is terrible for established interests.

Here's an idea. Implement reasonable wealth transfer tax policies and then earmark the tax revenue for innovation and entrepreneurship. Feed small business, capitalism, and democracy instead of monopolization and plutocracy. 

Some billionaires voted for…

Some billionaires voted for Biden. FTFY. 

Believe it or not, there are plenty of ultrawealthy people out there who believe democracy and capitalism is superior to plutocracy, and they're willing to vote against their own personal economic interest to promote that belief. Just like there are plenty of poor people out there who believe freedom and liberty are more important than social welfare and economic efficiency, and they're willing to vote against their own best interest to promote that belief. 

There is no inconsistency between the idea that some billionaires believe that democracy and capitalism is superior to plutocracy and the idea that we should have reasonable public policy that promotes democracy and capitalism at the expense of plutocracy. 

Again, these questions aren…

Again, these questions aren't that difficult. 

Let people run up their wealth as high as they can. A hundred million dollars, a billion dollars, whatever. Decrease the unified credit against estate and gift tax to something reasonable--IMO, set it equal to the median American's lifetime earnings, or even some multiple of that, indexed to inflation. (Surely you can't complain if you inherit an entire lifetime's worth of earnings.) Reduce or eliminate wealth transfer tax techniques that presently allow the ultra-wealthy to pass a potentially infinite amount of money down to their heirs tax-free.

Assets in the decedent's gross estate are valuated at their fair market value at the date of death unless some special valuation rule applies. If you have to liquidate assets in order to pay the tax, so be it. That's the funny thing about acquiring assets: If you can't afford the incident expenses, you can't afford the asset. If someone earns $4,000 per month, that doesn't mean they can afford a luxury vehicle that costs $4,000 per month. There are taxes, insurance, gas, maintenance, and other expenses. If you can't afford to pay your estate tax liability without liquidating assets, you should've thought about that before acquiring the assets.

In practical terms, the way this works is that people who won the birth lottery and were raised in an ultra-wealthy family will have to do the bare minimum--obtain education, training, and/or experience, and then create value for society--in order to achieve a life of luxury, instead of just existing and relying on handouts from their ancestors. 

Well, we will always be…

Well, we will always be having a discussion about inequality, I'll concede that much. 

But reasonable wealth transfer tax policies will pull the rug out from underneath the problem. It is simply the most reasonable and effective solution to maximize welfare without unduly infringing on the principles of liberty and justice.

Plutocrats in America currently have the ability to generate the average person's lifetime earnings a thousand times over every year completely tax-free. With proper planning they have the ability to pass an infinite amount of wealth on to their heirs completely tax-free. 

With their resources the ultra-wealthy are capable of directing public policy for their own benefit to the detriment of everyone else. Their dominion over contract law, property law, antitrust law, bankruptcy law, election law, and the enforcement of law causes extreme, outrageous economic distortions and inefficiencies, and totally subverts democracy.

Nip the problem in the bud and implement reasonable wealth transfer tax policies. 

How 'bout this. Let…

How 'bout this. Let millionaires and billionaires "exist." Then implement reasonable wealth transfer tax policies so that we don't need to have this discussion anymore. 

Billionaires are the result…

Billionaires are the result of plutocracy.

America had it right when we determined democratic capitalism was the most efficient and morally defensible system. Allowing the ultra-wealthy to rule over society for their own benefit to the detriment of everyone else is an absolute embarrassment to our ancestors. 

Plutocracy is not sustainable. It never has been and it never will be.