This is a partial transcript from "Your World with Neil Cavuto," June 7, 2006, that was edited for clarity.
NEIL CAVUTO, HOST: Meanwhile, death to the death tax once and for all, that is what our senators are debating today — as Tom DeLay was putting out, some lawmakers wanting to permanently kill it, arguing that doing so would renew life into our market and economy.
There is little doubt what you at home think, the FOXNews.com business poll showing well over 90 percent of you believe it is unfair to tax inherited money and property.
Here now to tell us what he thinks is Steve Forbes, the editor in chief of "Forbes" magazine and star of our very own "Forbes on FOX."
Steve, I think they're going to compromise on this, though. They're not going to get rid of it, but they're going to maybe lower the — the — the 46 percent, whatever it is, to maybe 15 percent, raise the level maybe to $10 million. What do you think of that?
STEVE FORBES, PRESIDENT & CEO, FORBES INC.: Well, it would certainly be better than what we have now.
But what I'm afraid is, we will end up with nothing at the end of the day. If they got rid of the death tax as part of a compromise, but left — put in a capital gains tax on any gains on inherited property, that would be a legitimate compromise. And then we can work in getting rid of the capital gains tax as part of a flat tax. But — but, as a first step...
CAVUTO: You are against this notion that it's going to lose a lot of revenue, that the estimates that have been out there...
FORBES: Oh, it's nonsense. It's nonsense.
CAVUTO: What's the truth?
FORBES: The Joint Tax Committee in Congress has come up with these bogus numbers that it's going to have a horrific, horrendous loss if we do this kind of compromise.
The real truth is, we spend more trying to deal with this tax, pay this tax, prepare to pay for it, or avoid it for our kids and grandkids, than the government collects on it. It's a net drain on the economy. It would be a great boost if we got rid of it once and for all.
CAVUTO: But the super-rich, yourself included, it's thought, they can't just dodge the tax man. It's not as if all of this income, you have paid tax on. Some of it, you have not, right? And your heirs should.
FORBES: Well, you have paid tax on it during your own lifetime. And, so, why should the government act as grave robbers?
And the fact of the matter is, if you're so-called super-rich, you have more resources to try to get around this thing. It's people who have created small businesses, who have built something up; they're the ones who are most vulnerable. And it's just an envy tax.
CAVUTO: But it's a class tax issue, too...
FORBES: Well, it is a class...
CAVUTO: ... and registers, particularly in an election year. And that's why I think as I was raising with Tom DeLay, Republicans are skittish to fight on this.
What do you say to that?
FORBES: Well, the Republicans lost their nerve last year because of Katrina. If they don't believe in their principles, why should the base come out, as Tom DeLay said, and vote for them, if they're not willing to fight for something basic like this?
CAVUTO: Do you think they're going to lose the House and/or Senate?
FORBES: Today, they would. A long time in politics between now and November. A week is a long time. A month is a long time.
They have a chance to turn it around. But if they keep retreating, do these preemptive retreats, and say, let's pretend we are Democrats and maybe people will vote for us, no way.
CAVUTO: But you must be annoyed, as someone who is pretty fiscally conservative, that Republicans have created more revenue with these tax cuts, but they have spent it like drunken sailors.
FORBES: Well, that's an insult to drunken sailors. They behave more responsibly than some of these guys have done.
But, yes, they have overspent. But that shouldn't blind us to the need for more tax reform, what reducing the tax burden on the American people will do for the American people. And that's what I don't understand our guys on Capitol Hill, some of them, don't get, especially in the Senate.
CAVUTO: We will never simplify the tax code, though, will we?
FORBES: Only through grassroots movement. They certainly won't do it on their own. On their own, they're spineless. They just want to cling to their offices. So, we have got to — Ronald Reagan put it best. He said, the best way to change minds on Capitol Hill is with the white heat of public opinion.
CAVUTO: Steve Forbes, thank you very much.
FORBES: Thank you.
CAVUTO: By the way, you can catch Steve and the rest of "Forbes on FOX" gang this Saturday at 11:00 a.m. Eastern time, right here on FOX. As Steve will tell you, FOX is the number-one network for business news.
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