A letter from an ill-mannered former high-school classmate of long ago, one of several like it, which I pass on in paraphrase: “I saw that your father had died,” she wrote. “He was always so clever about money. Did he leave you a big estate? Did he figure out a way around the estate tax?” It’s a rude question, but it has an answer.
My sister and I have been going through my father’s estate lately with his lawyer, and we’re pawing through old, dusty files to find bank account numbers and rules for annuities, so maybe it’s a good time to think about what my father, Herbert Stein, left to us.
He did indeed leave some money. By the standards we read about in the Wall Street Journal or Sports Illustrated, it was not worthy of much ink. In any event, because of the class-warfare-based death tax, the amount that will be left is vastly less than what he had saved. As an economist, my father was famous for defending taxes as a necessary evil. But even he was staggered, not long before his death, when he considered the taxes on his savings that would go to the Internal Revenue Service.
The nest egg is going to be taxed at a federal rate of about 55 percent, after an initial exemption and then a transition amount taxed at around 40 percent (and all that after paying estate expenses). When I think about it, I want to cry. My father and mother lived frugally all their lives. They never had a luxury car. They never flew first-class unless it was on the expense account. They never in their whole lives went on an expensive vacation. When he last went into the hospital, my father was still wearing an old pair of gray wool slacks with a sewed-up hole in them from where my dog ripped them–15 years ago.
They never had live-in help. My father washed the dishes after my mother made the meatloaf. My father took the bus whenever he could. His only large expenditure in his and my mom’s whole lives was to pay for schools for his children and grandchildren. He never bought bottled, imported water; he said whatever came out of the tap was good enough for him. They still used bargain-basement furniture from before the war for their bedroom furniture and their couch. I never once knew them to order the most expensive thing in a restaurant, and they always took the leftovers home.
They made not one penny of it from stock options or golden parachutes. They made it all by depriving themselves in the name of thrift and prudence and preparing for the needs of posterity. To think that this abstemiousness and this display of virtue will primarily benefit the IRS is really just so galling I can hardly stand it. The only possible reason for it is to satisfy some urge of jealousy by people who were less self-disciplined.
There are a few material, tangible items that an assessor will have to come in to appraise. There are my father’s books, from his days at Williams College and the University of Chicago, many of them still neatly underlined and annotated in his handwriting, which did not change from 1931 until days before his death. Most of them are about economics, but some are poetry.
That’s another item my father left: his own poetry and his massive prose writings. Very little of it is about anything at all abstruse. There are no formulas and no graphs or charts, except from his very last years. There are many essays about how much he missed my mom when she died, about how much he loved the sights of Washington, about how dismaying it was that there was still so much confusion about basic issues in economics. And there are his satires of haiku about public policy, his takeoffs on Wordsworth and Shakespeare, often composed for a friend’s birthday, then sometimes later published. I suppose there will not be much tax on these because my father was hardly a writer for the large audience.
Some of them will go to the Nixon Library, and some will be on bookshelves in the (very small and modest) house my wife and I own in Malibu, a place he found beguiling because he had always wanted to live by the ocean and write. And there are his furniture and his clothes, none of which has any value at all except to me because they remind me of him and because, when I stand near them in his closet, I can still smell his smell of hair and skin and leather shoes, the closet smelling a lot like he smelled when he came home from work in 1954 carrying a newspaper that said there could be no more racial segregation in schools. And there are his mementos of Richard Nixon, his White House cufflinks, photos of Camp David, certificates and honorary degrees, and clippings of great events of state. And there are his love letters to and from my mother when they were courting in 1935 and 1936, still tied with light blue ribbon in what was my mother’s lingerie drawer, talking about their love triumphing over the dangers of the Depression. I suppose we’ll have to place a value on these and have them taxed, too.
But these are the trivia of what he left me and my sister. The really valuable estate cannot be touched by the death tax. The man’s legacy to his family has almost nothing to do with anything that can be appraised in dollars and cents.
The example of loyalty and principle: When he had just taken over as the chairman of President Nixon’s Council of Economic Advisers, he hired a young staff economist named Ron Hoffman (brother of Dustin Hoffman). Almost immediately, John Dean, then White House counsel, came to see my father to tell him that he had to fire Hoffman. Apparently, Ron Hoffman had signed a public anti-war letter. The FBI, or whoever, said that showed he was not loyal and not qualified. My father said that this was a free country, that Ron Hoffman was hired as an economist not as a political flack for RN, and that he would not be fired because he disagreed with some aspect of Nixon policy. After much worrying, Hoffman was allowed to stay–and performed well.
My father was loyal, and the IRS cannot impound that legacy. When RN ran into every kind of problem after June of 1972, most of which were unearned and a chunk of which was earned, my father never thought of disavowing him or even distancing himself from Nixon. Even though he had an appointment to the University of Virginia in his pocket, Pop several times extended his stay at the White House to help out with the struggles over inflation and recession, and never once publicly said a word against Nixon.
Long after, when Nixon was blasted as an anti-Semite, my father told in print and in person of the Nixon he knew: kind; concerned about all on his staff, regardless of ethnicity; pro-Israel; pro-Jewish in every important cause. My father would never turn his back on a man who had been as conscientious to the cause of peace and as kind to the Stein family as RN had been.
“Loyalty.” There is no item for it in the inventory of estate assets to be taxed.
My father lived his life, especially in the latter years of it, in a haze of appreciation. Whatever small faults he could and did find with America, he endlessly reminded anyone who listened that the best achievement of mankind was America, whose current failings were trivial by historic standards, which was in a constant process of amelioration, and which offered its citizens the best chance in history for a good life.
When he did consider the failures of American life in the past, especially institutionalized racism, he did so to note the astonishing progress that had been made in his lifetime. He had no use for those who held up a mirror of fault-finding from the left or the right when he could see in his own era what vast improvements in freedom had been made for blacks, Jews, women, Asians, Hispanics, and every other minority.
He appreciated art, especially ballet and opera. He sat for hours in front of the television watching videos of Romeo and Juliet or Les Sylphides or Tosca. He lived to go to the Kennedy Center to see great ballet or opera, and he talked of it endlessly. But he also appreciated art in the form of obscure fountains in front of federal buildings, of the statues of Bolívar and George Washington and San Martin. He appreciated the intricate moldings on the ceiling of the second floor of the Cosmos Club. He was in awe of the beauty of the mighty Potomac in fall and of the rolling green hunt country around Middleburg and The Plains, Va., in summer.
This quality of gratitude for America and for the beauty of life cannot be taxed, at least not so far.
He appreciated his friends and did not differentiate between them on the basis of fame or position. He took the words of his longtime pal Murray Foss at the American Enterprise Institute, a think tank where he hung his hat for many years, into account; and the words of Mrs. Wiggins, who ran the cafeteria at the AEI; and the thoughts of Alan Greenspan or the head of Goldman, Sachs; and valued them entirely on their merits to him, not on the basis of how much press or money the speaker had. He never once in my lifetime’s recall said that any man or woman deserved special respect for riches–in fact, like Adam Smith, he believed that the pleadings of the rich merited special suspicion. He did not believe that my sister or I should devote our lives to the pursuit of money, and by his life set an example to us of pursuing only what was interesting and challenging, not what paid the most. I never knew him to chase a deal or a job (he never in his whole life applied for a job!) for any other reason except that it was of interest to him. He derived more pleasure from speaking to his pals at the book club of the Cosmos Club about John Keats than he did from giving speeches to trade associations that paid him handsomely.
My father’s stance against seeking money for its own sake–so wildly unsuited to today’s age, but so reassuring to his children–cannot be taken by the Treasury.
Pop had a way of putting what I thought of as catastrophes into their rightful context. If I was hysterical about losing some scriptwriting job, my father would brush it aside as a basic risk, part of the life I had chosen. If my stocks went down, even dramatically, my father would explain that if I had a roof over my head and enough to eat, I was far, far ahead of the game. Most reassuring, my father would tell me that my family and I could always come to Washington, D.C., and live quietly, keeping him company, for which not a lot of money was required. (My father lived on a fraction of the income from his savings, even allowing for paying for his grandchildren’s education.)
Once, about 25 years ago, when my boss treated me unfairly, my father said that if it happened again, I should quit and he would take care of me until I found a job. I never needed to do it, but the offer hung in my mind as a last refuge forever.
This reassurance–that somehow things will be all right, that there is a lot of ruin in a man, as well as in a nation, to paraphrase his idol, Adam Smith–has become part of me, and I can still summon it up when I am terrified because of a huge quarterly tax payment due or a bad day on the market. Again, the IRS taxes it at zero.
My father himself, as far as I know, inherited no money at all from his father. He did inherit a belief that hard work would solve most problems, that spending beyond one’s means was a recipe for disaster, that flashy showoff behavior with borrowed money was understandable but foolish. He did inherit enough common sense to tell his son that buying property he would never live in was probably a bad mistake. (He rarely spoke in moral absolutes. He believed instead that humans could and would make individual choices but that there were surely consequences to those choices that could be considered.) He passed these beliefs on to me, although they have become somewhat attenuated by my 20-plus years in the fleshpots of Hollywood. Still, I am one of the only men I know here who has never been drastically short of money (so far), and that I attribute to hearing his rules of prudence.
Most of all, my father believed in loving and appreciating those persons close to him. He stayed close to all his pals from the Nixon days (and would not hear personal criticism of Pat Buchanan, who had been a friend and colleague, although he was bewildered by Pat’s stands on many issues). He basked in the pleasure of the company of his colleagues and friends at the American Enterprise Institute, which he thought of as one of his three homes–the Cosmos Club and his extremely modest but well-situated apartment at the Watergate were the others.
He could form attachments readily. Even in his last days in the hospital, he took a liking to a Ukrainian-born doctor and used to refer to him as “Suvorov,” after the Russian general written of glowingly in War and Peace–which still sits on the table next to his reading chair, with his notes on little pieces of paper in it.
He grieved like a banshee when my mother died in 1997 and never really got over the loss of a soul mate of 61 years, who literally dreamed the same dreams he did. Once, he wrote my mother a poem (which he called “Route 29”) about the beauty of Route 29 north of Charlottesville, Va., and the pleasure of riding along it with my mom. He filed it away for further work and never touched it again. The day after my mother’s death, he found it–with her reply poem telling of how she hoped to never see those hills and those clouds and those cattle with anyone else but Pop. She had written her poem (which she titled “Only You”) and put it back in the file without ever telling him. He survived that terrible loss with the help of a beautiful widow, whom he also came to appreciate and live for. He probably spent more time trying to help her with an annuity problem than he ever did on any financial feature of his own life. A simple call from her inviting him to dinner in her kitchen on Kalorama Circle was enough to make his life complete.
Even in his hospital bed, hearing my son’s voice on the phone could make him smile through the fear and the pain. (“He sounds so sweet when he calls me ‘Grandpa,’ ” my father said, beaming even with tubes in him.)
Never once did my sister or I ever ask him for help that he hesitated, let alone declined, to give. Usually this was some research we were too lazy to do, but which he did without any resistance at all. When I was a child and had a chore like leaf raking that I didn’t want to do, his simple answer was to say, “Let’s do it together. It’ll take half as long.” I use that with my son almost every day, along with the devotion, and my father’s example about his friends from long ago to make my life work. He stayed close with friends from Williams College Class of ‘35, especially Richard Helms of the CIA. He had lunch with one of his pals from Williams, Johnny Davis, class of ‘33, who got him a job as a dishwasher at Sigma Chi, days before he went into the hospital.
This quality of devotion and the rewards I get from it are worth far more than any stocks or bonds in my father’s estate–and cannot be taken away at the marginal rate of 55 percent. Plus, I can pass it on to my son without any generation-skipping surcharge.
And he left something else of perhaps even greater value: a good name. Many people quarreled with my father’s ideas about taxes or about when to balance the budget. He faced frequent opposition to his belief in a large defense budget. Of course, most of the people he knew disagreed with him about RN. But no one ever questioned that he came by his views honestly, by means of research and analysis and sometimes sentiment, but not for any venal reason or by the process of money changing hands. His reputation for honesty was simply without a speck of question upon it.
This good name cannot be taxed at all, at least not right now. My sister and I and our children will have it for as long as we keep it clean. It’s priceless, incalculable in value.
So, in answer to the query from the forward high-school classmate, “Yes, my father did leave an immense estate, and yes, he did manage to beat the estate tax.” The only problem is that I miss him every single minute, and I already had the best parts of the estate without his being gone, so the death part is pure loss.