There's only one thing I can say about the "taxed twice" argument, I know that I pay taxes twice or three times on the "same money". It happens.
But regarding the last paragraph. I don't know why the rest of us should care whether the heirs sell the company or keep it.
If somebody else is more optimistic about running it for a profit, let the heirs sell and the new owner will try some changes that may improve things. The heirs will take the sale proceeds and recycle them into the economy where they will "create jobs" one way or another.
If nobody believes the company can be run profitably, then it's time to close it down. The heirs will sell the hard assets and recycle the proceeds. The employees will have to find jobs with other firms with better profit prospects. That's unpleasant for everybody involved, but it happens every day somewhere in our economy. I can't see why the fact the company is changing hands due to a death means that the government should somehow try to keep it going if it doesn't look profitable to anyone.
The rest don't have to care. But if we all want jobs in this country for ourselves and our children...it might be prudent to do so.
How important are small businesses to the U.S. economy?
Small firms:
Represent 99.7 percent of all employer firms.
Employ just over half of all private sector employees.
Pay 44 percent of total U.S. private payroll.
Have generated 64 percent of net new jobs over the past 15 years.
Create more than half of the nonfarm private gross domestic product (GDP).
Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).
Are 52 percent home-based and 2 percent franchises.
Made up 97.3 percent of all identified exporters and produced 30.2 percent of the known export value in FY 2007.
Produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large firm patents to be among the one percent most cited.
Sources (see the Office of Advocacy's Research and Statistics page):
U.S. Dept. of Commerce, Bureau of the Census and International Trade Admin.
Advocacy-funded research by Kathryn Kobe, 2007
CHI Research, 2003
U.S. Dept. of Labor, Bureau of Labor Statistics.