I know that many in this community are not fans (to put it mildly) of Blue Dog Democrat Stephanie Herseth-Sandlin (SD-AL), but the lead story in today's Washington Post about her race against "the next Sarah Palin" got my attention.
For those who haven't followed that race, Herseth-Sandlin's opponent is Kristi Noem, a full-throated Tea Party candidate who positions include opposing womens' reproductive rights, opposing healthcare coverage for millions of Americans, and repudiating Nancy Pelosi and Barack Obama. Says the Post, in a (now sadly typical) pandering to the Right sort of manner:
Noem, 38, is authentic, tall and lean, soft-spoken but tough, an unabashed conservative who rarely strays off script. She's a made-for-Fox News star in her own right.
Whereas Herseth Sandlin grew up on a farm, Noem runs a ranch. She rides horses, herds cattle, hunts elk (with a bow), shoots prairie dogs (with a rifle) and skins pheasants.
http://www.washingtonpost.com/...
Noem also has Mitt Romney's endorsement, and a campaign staffed by the same group that took down Tom Daschle. She is as scary as all get out, ahead in the Rasmussen polls (not surprising, but still . . .), and will undoubtedly be a real contender in the 2014 Senate race against Tim Johnson.
Now trust me, Herseth-Sandlin is a horrible disappointment to me, and she is running as fast as she can away from the Democrats in an effort to save herself. But Noem is such a hideous alternative . . .
Anyway, one of Noem's talking points is that she supports making the abolition of the federal estate tax permanent. On the campaign trail, she apparently tells the story of how her family nearly lost the family farm to federal "death taxes" when she was 20 years old and her father died in a grain elevator incident. Apparently, the Noem family had to take out loans to pay those awful taxes and save the farm. Noem uses her personal story as fodder for her attack on the expiration of the moratorium on estate taxes.
I don't know that much about estate taxes, and certainly wasn't paying attention to estate taxes as they were structured back in 1992, when Noem's dad died. However, I do know a few things, such as: 1) 1992 was the end of 12 years of Republicans in the White House; 2) there had been estate tax reform in 1987 that reduced the number of households that even had to file an estate tax return from over 7% to less than 1%; 3) your net estate had to exceed $600,000 (which was a bigger chunk of change back in 1992) before you had to pay dollar one of estate taxes; 4) there was an unlimited spousal deduction, so if you had a surviving spouse and the assets passed to the spouse, that money wasn't even included in your estate; 5) you had to be pretty darn well off to worry about paying federal estate taxes, or you had to do virtually no estate planning and then pay the price for not having the foresight to draw up a will.
Noem's mother -- the surviving spouse of her deceased father -- is still alive. So, unless Noem's parents had ill-advisedly had the farm titled in her father's name alone, or had even more ill-advisedly tried to divide the farm up between Noem's mother and the surviving children (which may have been the case, as Noem was at one point a 16.7% owner of the operation), the federal estate tax shouldn't have been a concern. Either that or the Arnold family (Noem's maiden name) were pretty darn wealthy farmers back in 1992.
I also know that the whole "death tax destroying family farms" meme has been called out as malarkey many, many times, particularly after the 1997 Tax Reform bill signed by President Clinton, that provided many additional legal protections and perks for family farm owners. See
http://www.cbo.gov/...
All this makes me wonder -- is Noem's apocryphal story about nearly losing the family farm to "death taxes" really even true? It sure would be nice if someone from one of the newspapers out in South Dakota would dig into this story a little bit, and try to pry loose some more details. Come on, Argus-Leader, you can make this a little project prior to election day, can't you?
The denoument of Noem's potentially tragic story of nearly losing the family farm to federal "death taxes?" Well, the Noem family was able to rebound nicely, pay off those pesky loans, and even expand the farm, adding a ranch, a hunting lodge, and a restaurant (which was subsequently closed due to financial mismanagement). In fact the ranch itself did so well that Noem was able to sell off several hundred cattle to initially fund her Congressional campaign (she now of course has all kinds of out of state money).
Oh, and Racota Valley Ranch, Noem's ranch, has received $3,058,152 in farm subsidies since 1995. That squares really nicely with Noem's purported stance against "excessive government spending," "free enterprise," and "individual responsibility." She also alleges that she, as a small business owner and a rancher understands the importance of a budget. Pretty easy to balance your budget with over $3 million in federal subsidies, I'd say.
