Andrew Mellon’s humongous donation to Donald Trump
The best evidence yet for why we need to tax wealth
Robert Reich robertreich @ substack.com
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Andrew Mellon, treasury secretary for Harding, Coolidge, and Hoover
Andrew Mellon, Timothy’s grandfather, is the source of this money. As secretary of the Treasury, Andrew cut the estate tax by half, arguing that “the social necessity for breaking up large fortunes in this country does not exist.” He also whittled down the top income tax rate from 73 percent to 25 percent and eliminated the gift tax. These changes enabled Andrew to shift much of his personal fortune — estimated to be $600 million in 1932 (about $9 billion today) — tax-free to his heirs, including Andrew. Forbes estimates the Mellon family is now worth $14.1 billion.
The Mellon money trail exemplifies the perils of dynastic wealth — and why we need a wealth tax in America. Alternatively, the capital gains tax must be applied to the appreciated value of assets held during someone’s life, before they die and hand them off to their heirs at current market values.
When he was a Virginia legislator, Thomas Jefferson sought legal ways to prevent the perpetuation of great fortunes, fearing that the rise of an American “aristocracy of wealth,” would cause more “harm and danger, than benefit, to society.”
The wealth and power extending from Andrew Mellon to his grandson Timothy proves Jefferson right.