Yes, I took the family to hear Boortz last night. If one is familiar with his positions on the issues of the day and conversant in the concept of the FairTax, his speech contained nothing new, but was fun nonetheless. See coverage here, here, and here.
Public Service Commission Chairman Bobby Baker recently won that civil suit challenging his residency. The victory comes as no surprise, as the suit seemed more of a nuisance action than a legitimate complaint.
My hometown SCHS Indians posted a 20-7 win over Hart County last Friday, the third ranked opponent to fall before the Indians this season. SCHS (9-0, 5-0) is currently ranked #3 in the AJC AAA poll and rounds out the regular season against Elbert County (1-8, 0-5) this coming Friday evening at the Granite Bowl
For what it is worth, my wife and I have decided to support Mike Huckabee in the GOP presidential primary. We have been sporting Huckabee car magnets for about a week now. More on presidential matters later.
Tuesday, November 6, 2007
Impertinent Observations
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4 comments:
"7% - 13% economic growth projected in the first year of the FairTax"
Yep, an economists w/ an ax to grind --or a plan to push-- are never wrong in their predictions (kind of like politicians w/ a war to push ;-) ), right?
I don't think naysayers probably like those things any more than anyone else, and few people seem to like paying taxes period --though they are quite happy to complain when THEIR kids' schools are underfunded, when THEIR water is polluted, when THEIR roads' potholes don't go fixed etc.
But the idea that the fair tax will solve all our problems is just pie in the sky rubbish. Get rid of the IRS and govt bureaucracy? Who's going to be processing all those "prebates"? Whose going to be collecting the sales tax revenue? Come on, it will be just as big a bureaucracy. So, given that the reduced bureaucracy argument is a straw man/ woman/ person, then what are we left with? An alternate way of collecting revenue. Personally, I prefer an income tax (and a tax on "unearned" monies like profits made from speculating on the stock market) to a consumption tax (aka glorified sales tax) because the latter is regressive --those who are poorer pay a bigger proportion of their income than those who are wealthier. Call me a class warrior if you like, though I am no more that than those who want to see the tax burden shifted away from the wealthy --which is what this flat tax, fair tax et al nonsense is all about.
Also, there is no guarantee that all those wealthy people who used to pay income tax here will continue to pay consumption taxes here --they are just as likely to buy their yachts, private jets etc overseas, which means that the good old US of A gets absolutely diddly of their income.
I suggest that we learn from Watergate --follow the money and you will see who benefits from any plan. In this case the pushers of this are generally wealthy and Republican --Laffler (Reagan's supply-side guru) has pushed much of this, as he is pushing the Glenn tax here in GA. Nuf said.
Now, does the current system need reform? You betcha. For starters, we need to get back to a progressive income tax system, we need to cut out a bunch of the special tax breaks for a whole slew of dubious things that only got put in there because some powerful pol pushed them (whether Rep or Dem) but for which the rest of us pay. We need to increase the personal allowance on federal and state income taxes, which will really help people at the bottom. We need to fix the Alternative Minimum Tax, which will help people in the middle. We need to increase the Earned Income tax Credit.
What we don't need to do is throw the baby out w/ the bathwater.
Anon, I've taken the time and done the dog-labor on this FairTax plan.
There is no reasonable equity of distribution under the current INCOME tax system. What's more, the Tax Code has become a "tinkerer's paradise" for 53% of the lobbyists who game it in Washington DC. It's a lucrative business, and the U.S. TAXPAYER pays for ALL of it in higher prices (i.e., a hidden tax which is incomprehensible to the average working person).
Prices after FairTax passage would look similar to prices before FairTax - not "30% higher" as opponents contend - competition would see to it. So, the FairTax rate (figured as an income-tax-rate-non-comparative, sales tax) on new items would be 29.85% (on the new, reduced cost of items because business isn't taxed under FairTax - thus lowering retail prices by 20% to 30%), or 23% of the "tax inclusive" price tag - this is the way INCOME TAX is figured (parts of the total dollar).
The effective tax rate percentages, that different income groups would pay under the FairTax, are calculated by crediting the monthly "prebate" (advance rebate of projected tax on necessities) against total monthly spending of citizen families (1 member and greater, Dept. of HHS poverty-level data; a single person receiving ~$200/mo, a family of four, ~$500/mo, in addition to working earners receiving paychecks with no Federal deductions) Prof.'s Kotlikoff and Rapson (10/06) concluded,
"...the FairTax imposes much lower average taxes on working-age households than does the current system. The FairTax broadens the tax base from what is now primarily a system of labor income taxation to a system that taxes, albeit indirectly, both labor income and existing wealth. By including existing wealth in the effective tax base, much of which is owned by rich and middle-class elderly households, the FairTax is able to tax labor income at a lower effective rate and, thereby, lower the average lifetime tax rates facing working-age Americans.
"Consider, as an example, a single household age 30 earning $50,000. The household’s average tax rate under the current system is 21.1 percent. It’s 13.5 percent under the FairTax. Since the FairTax would preserve the purchasing power of Social Security benefits and also provide a tax rebate, older low-income workers who will live primarily or exclusively on Social Security would be better off. As an example, the average remaining lifetime tax rate for an age 60 married couple with $20,000 of earnings falls from its current value of 7.2 percent to -11.0 percent under the FairTax. As another example, compare the current 24.0 percent remaining lifetime average tax rate of a married age 45 couple with $100,000 in earnings to the 14.7 percent rate that arises under the FairTax."
Further, per Jokischa and Kotlikoff (circa 2006?) ...
"...once one moves to generations postdating the baby boomers there are positive welfare gains for all income groups in each cohort. Under a 23 percent FairTax policy, the poorest members of the generation born in 1990 enjoy a 13.5 percent welfare gain. Their middle-class and rich contemporaries experience 5 and 2 percent welfare gains, respectively. The welfare gains are largest for future generations. Take the cohort born in 2030. The poorest members of this cohort enjoy a huge 26 percent improvement in their well-being. For middle class members of this birth group, there's a 12 percent welfare gain. And for the richest members of the group, the gain is 5 percent."
It's well past time to scrap the tax code and pay for government the way that America's working men and women are paid - when something is sold.
(Permission is granted to reproduce in whole or part. - Ian)
Beware of Greeks (or, in this case, flat taxers/ fair taxers) bearing gifts.
As I said, I'd rather have an income tax than a consumption tax. For every statistic you can throw at me I can throw one right back at you --remember, there are lies, damned lies, and statistics. In the end, I think, it just comes down to a fundamental philosophical difference concerning how govt should generate revenue, who should pay etc. I am just not as scared of "big, bad" govt as you appear to be. Sorry!
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