June 12, 2002 (APJP) -- Permanent repeal of the estate tax was looking as inevitable as a Lakers 3-peat. Last week, the Republican-led House of Representatives voted 256-171 to permanently repeal the tax.

The Senate, however, blocked the repeal on Wednesday by a mere six votes.

Don't think that this debate is going to go away. Republicans are already gearing up for the election in November, and will use this vote to cast themselves as anti-tax crusaders. We're sure to hear much more about repealing the estate tax in the coming months.

Why does this nutty economic idea continue to have traction? Maybe it's the topic itself that causes us to lose our rationality. Death and money, two subjects that touch us right where we live, intersect within the so-called "death tax."

Conservatives, masters of obfuscation, have spun the issue in such a way that it is almost impossible to have a rational conversation about the tax itself. But we can't afford to let the apologists for a few craven misers demagogue their way into changing our tax code.

So here's my little contribution to the debate. Next time you get into a discussion about the estate tax, tell the story below, and follow up with the question at the end. I've shared this tale with dozens of conservatives, and have yet to have one of them answer the final riddle in any satisfying way.

Once upon a time, there was a very hard working old man who made his fortune through the blessing of America's great capitalist economic system (this opening should make your conservative friends warm up to this story quickly). Of course, he paid income taxes, but he loved living in this great country and was happy to contribute his share.

Knowing that the end was near, he decided to take the wealth that he had amassed and create one final, sweeping testament to his life. So he found a brilliant young architect (Ayn Rand reference ­ more conservative bait) and made him an offer:

"I want you to build me a mausoleum. I want it done in two years, and I want it to be fantastic ­ spare no expense. Use the finest materials, hire as many contractors as you need, and build it to last. If you do this, I'll pay you $10 million dollars."

Of course, the architect couldn't refuse this offer, so he signed a contract and got right to work. For two years, he toiled tirelessly on the structure. He hired hundreds of people, which generated a good deal of economic activity in the area. Business boomed in the town where the mausoleum was being built. He spent freely on building supplies, and his workers enjoyed the wages they were paid, which created new businesses.

At the end of two years, a spectacular mausoleum stood tall above the town. The rich old man looked at it and declared, "It's perfect. Thank you. Here's your $10 million."

Right after he signed the check and handed it to the architect, he keeled over and died.

As it turns out, after all the expenses and the architect's fee, the man left an estate worth $10 million. His sole heir was his nephew, who happened to be a very nice kid but had never really known his uncle.

Well, tax day rolls around, and it turns out the nephew and the architect use the same accountant. They bump into each other at his office as they pick up their returns.

"Hey, great news!" says the nephew. "It looks like the Bush tax plan is permanent! I don't owe any taxes!"

"Wait a minute!" says the architect. "You got $10 million; I got $10 million. It came from the same place. You're a nice guy and all, but you did nothing to earn that money. I, however, worked my butt off for two years for the old man. I created jobs, generated economic activity, and built something beautiful. Why do I have to pay taxes while you get away with paying nothing?!"

And that is my question to all of you who want to repeal the estate tax: why is the architect paying taxes, while the nephew gets off tax-free?

Usually, the conservative I've told the story to will bring out the bromides and platitudes that have been fed into her head by a steady diet of talk radio, Fox News and Wall Street Journal editorials. So it's easy to predict what her rebuttals will be:

1) Look, the estate tax is wrong because the money in an estate was already taxed when the deceased made it.

Answer: If that's the argument, then why don't the architect and the nephew both get their money tax-free? Each of their $10 million came from the same pot, right? Why does the nephew get preferential treatment?

Taxes are based on economic transactions, and inheriting money is as much of a transaction as paying a wage. By this logic you could argue that the architect shouldn't pay taxes either, because his wages were already taxed.

2) Well, we should lower taxes on everyone.

Answer: Maybe, but what does that have to do with the estate tax? Nobody I've heard argue for the repeal of the estate tax is also calling for the repeal of all taxes.

When you let the nephew off, you have to make it up somewhere. You have to raise taxes on workers like the architect, who actually contributed to the economy; or you have to cut government services. But if you do that, why pass along the savings to the nephew, and not the architect?

There's also the little matter of unrealized capital gains. If the old man bought a painting valued at $100, and it was worth $1000 when he died, his estate has increased in value by $900. But if he never sold the painting, he never paid tax on that gain.

Now the nephew gets the painting, and he turns around and sells it for $1000. But since he sells it for the value he inherited it at, he pays no capital gains tax. That's $900 of income that no one ­ not the old man, and not the nephew ­ ever paid tax on.

Some economists estimate that unrealized capital gains like these make up 56 percent of estates over $10 million. That means over half of the value of these large estates has never been taxed. Why such a huge break for those who inherit money, and nothing for those who work?

3) Well, why don't we just tax those unrealized capital gains at the time the assets are sold by the heirs?

Answer: That's part of the Bush plan ­ carry the basis over, and only pay the tax when the nephew sells the painting. But you can see how easily that will gunk up the works: everyone who thinks they might leave a taxable estate will have to keep track of all of their capital assets over their lives, and figure out the basis of things they inherited, and so on. What a mess!

And where there are tax messes, there are tax lawyers, scheming and plotting. Already, tax specialists have proposed all sorts of byzantine tax avoidance scenarios involving the gift tax, asset depreciation, and who knows what else. I thought conservatives wanted to make taxes simple.

But let's get back to our parable, and put it in the simplest of terms: suppose the nephew is getting $10 million in cold cash, just like the architect. No capital assets ­ no capital gains taxes. That's $10 million tax-free. Again, why is the architect paying while the nephew isn't?

4) Listen, I hear what you're saying about hurting the architect, but an inheritance is different. The nephew was family. People should be able to leave something for their loved ones when they die.

Answer: But at whose expense? Conservatives are always talking about how taxes are a disincentive to work, so you need to keep them as low as possible. Yet here's a guy who worked day and night and gets taxed while the nephew gets his money tax-free.

What about the architect's family? They had to endure the sacrifice of his long hours and hard work. How are we promoting family values when hard work is punished while winning the genetic lottery is rewarded?

And by the way ­ what if the kid wasn't his nephew? What if he was a friend? A gay lover? A complete stranger? What if the old man was a Democrat and willed the money to Bill Clinton to help pay off his legal bills? I'm not aware of any provision in the tax code that says you have to will your estate to family members.

5) All right smart guy, how about this: suppose the $10 million isn't in cash? Suppose it's a business? And the nephew doesn't have the money to pay the estate tax, so he has to sell its assets, and he puts people out of work?

Answer: Well, there are a lot of things I could bring up to refute this. Like how, under the old rules, the estate tax treated small businesses differently than other assets in estates, allowing estates larger exemptions. Or how heirs could defer payments of those taxes up to 14 years. Or how, in 1998, only 1.6 percent of taxable estates had family businesses whose value was at least half that of the estate.

Also, back in 1996, the Democrats proposed raising the business exemption for estate taxes to around $8 million, just to protect small businesses and family farms. Cynical Republicans made sure that idea went nowhere.

But let me instead turn back to the architect: what about his business? Why should his employees get less job security, and lower wages, because of the tax burden he has?

Yes, he knew he'd have to pay taxes, and he budgeted accordingly. Why couldn't the old rich man do the same? He could set up his business to meet his estate's tax burden. Again, why is the nephew ­ or his new business - getting a free ride, while the architect is not?

6) But I've heard that under the old rules the tax rate on estates was 55 percent. That's outrageous! The architect isn't paying 55 percent in income tax ­ why should the nephew?

Answer: 55 percent was the MARGINAL rate, not the effective rate. Conservative think tanks like the Heritage Foundation love to spit this number out without fully explaining what it means, and radio talk show hosts and conservative columnists love to parrot it.

The first $675,000 in an estate was exempted from taxes ­ that was true whether your estate was $10,000, $1 million or $10 million. That's why less than 2 percent of deceased people had any tax on their estate.

If your estate was larger than the $675K, it got taxed at rates that grew gradually up to 55% (the $675K exemption did get phased out starting at $10 million, but estates that large still enjoyed progressive rates). The EFFECTIVE tax rate was the percentage of the estate that actually went to taxes, using these rising marginal tax rates. And guess what?

In 1997, when any tax was paid on an estate, the EFFECTIVE rate was about 17 percent. If the estate was over $20 million, the EFFECTIVE rate was 14 percent.

If I was the architect, I would LOVE to pay that kind of effective rate on my income taxes ­ especially if I didn't have to do any work to get the money in the first place!

7) You know what ­ I think you hate rich people. I think you just want this tax so you can redistribute wealth, because you can't stand it that someone was successful and left their wealth to some lucky kid. Life is unfair ­ get over it!

Answer: Actually, I like rich people. I want to be a rich person. I go to work everyday and work hard so that someday I'll be rich, too.

And I like the architect ­ he's rich. He deserves his money: he's gifted and hard working. He created jobs and built something beautiful. But again, I ask: why is he being taxed while the nephew isn't?

This isn't a rich vs. poor issue; it's about how we decide how to pay for the government, even if it's the minimalist government conservatives are always crowing that we need.

Repealing the estate tax essentially says that we value an irrational connection between death and money over work. It punishes those who contribute to America's economic engine by rewarding those who simply happen to be in the right place at the right time.

If I do become rich someday, I will leave my money to my kids, and I hope they will enjoy it. But I won't for a second believe that they should skip out on their obligations to our society while hard working men and women pick up their share of the bill.

That's anti-capitalist, anti-work, and anti-American. The architect would agree ­ and the old man would, too.

Of course, the nephew probably wouldn't - he'd need the extra cash to pay for a picture of Bush on Air Force One during 9/11...

Note: Many of the statistics used in this article came from the Center for Budget and Policy Priorities.

Mark Weber is a writer and composer who came into politics working on behalf of funding for the arts.