OT: What do you guys think of this "Fair Tax Plan"

[Bacdoc]

Hey guys and gals,

I've heard a little about this, not enough to make an informed decision mind you, but on the surface it sounds like a good idea.

I was just reading a post on this subject in another forum, and found the differing opinions fascinating. Unfortunately, the thread turned into an angry, confrontational, pissing contest between two of the members.

I've come to value the opinions of the members of this board and was curious what you all thought about this "Fair Tax Plan".

If you'd like some info on it check out this site

http://www.fairtaxvolunteer.org/main.html

or the FAQ at

http://www.fairtaxvolunteer.org/smart/faq-main.html#1

[Bacdoc]

I'm sorry, perhaps this should be moved to the political forum. My bad!!!!!

[dchester]

For me, the main advantage I see in going with a national sales tax instead of the income tax, is that we wouldn't have to file tax returns any more.
________
justin bieber (http://justinbieberfan.info/)

[Flagg the Wanderer]

It's a horrible idea. More detail to follow.

[Flagg the Wanderer]

Originally posted by Flagg Wanderer
It's a horrible idea. More detail to follow. Keep in mind as I say all of this that I'm fiscally conservative, even with a libertarian streak. On the surface, this is right up my alley. I advocated for something similar for quite a while.

But here's the problem. Well, here are the several problems:

1) It is NOT revenue neutral. More than ever, tax revenues would ebb and flow with the economy as people get scared and purchase less when things start getting a little scary - everyone, not just the people that get laid off.

2) It's a little bit progressive by allowing rebates to Soc. Sec. recipients, and for "necessary" (whatever that means) goods up to the poverty line, but think about it - who spends a greater percentage of what they take home - a family of 4 earning 70k or a CEO earning 400k? This plan is helpful to the poor, helpful to the wealthy, and screws the middle class mercilessly.

3) Further, by advocating for the repeal of the other taxes like on interest income and capital gains, it is even MORE beneficial to the most wealthy people in our society, who make a much greater amount of money through interest and capital gains than the lower classes.

4) It completely eliminates corporate taxation. I'm a pro-corporation kind of guy, and I hear the argument that corporate profits go back to the population through the distribution of earnings and capital gains, but again, that mostly benefits the wealthiest Americans. Not to mention that the structure of large corporations essentially ensures that all those increased profits will pad the bonuses of the top executives - the law of large numbers demands it.

5) (and this is a big one) It puts the government in a position to encourage the American people to spend instead of save. While this can help the economy over the short and medium term, consumer debt in the U.S. is absolutely through the roof. It is not sustainable.

6) Most corporate malfeasance and accounting errors (intentional or otherwise) are caught somewhere in the income tax accounting process (that is, through the IRS). The required accountings to Uncle Sam would be limited to solely revenue figures.

7) Similarly, the only thing keeping corporations from employing illegal aliens en masse to save costs are those income tax reports that are filed - which have to jibe with the other accounting reports that they file with the IRS. This would be essentially putting up a neon sign inviting illegal alieans to come work here - putting citizens and legal aliens out of work in huge numbers.

8) Every accounting firm in the country, along with every tax attorney in the country, would immediatly be out of work. Ditto for 95% of employees at the IRS. If this was for something with serious long term benefit I could accept that as a short term cost, but considering 1-7 above, it's a big hit to take so that you can screw yourself over continually in the future.

Anything I missed? I'm sure I'm forgetting something...

[MadStork]

I don't believe any such animal as a 'Fair Tax Plan' will ever exist.

Just go with the Flat Tax plan of 13% and call it a night.

[Benign Despot]

Any serious look at a "fair" tax has to take into account the fact that we pay taxes to 3 different jurisdictions. Here in Mass we pay Income Taxes to the Federal Government, Income and Sales taxes to the state and Property taxes to the local government.

Most of these plans only target the Feds, the largest share to be sure, but still only a share.

[MadStork]

Originally posted by Benign Despot
Any serious look at a "fair" tax has to take into account the fact that we pay taxes to 3 different jurisdictions. Here in Mass we pay Income Taxes to the Federal Government, Income and Sales taxes to the state and Property taxes to the local government.

Most of these plans only target the Feds, the largest share to be sure, but still only a share.

You guys pay taxes on everything, payable to everyone - which is why I no longer live in Mass. Give me NH any day!:thumb:

[Threadkiller]

MODS.....

POLITICAL FORUM! POLITICAL FORUM!

C'mon! This is not even close! If the "Rush Limbaugh wants to mediate the differences between T.O. and McNabb" thread - which by the way was pop culture absurdity at it's finest - got moved to the Political Playground without having a thing to do with politics just because Limbaugh is a turd and a Republican operative, then there is no question this should be moved.

[backofthepack]

Originally posted by Threadkiller
MODS.....

POLITICAL FORUM! POLITICAL FORUM!

C'mon! This is not even close! If the "Rush Limbaugh wants to mediate the differences between T.O. and McNabb" thread - which by the way was pop culture absurdity at it's finest - got moved to the Political Playground without having a thing to do with politics just because Limbaugh is a turd and a Republican operative, then there is no question this should be moved.

I 2nd the motion :archive:

[Undertaker #59]

I was waiting to see if it turned into the typical partisan bickering. There was nothing left or right about the discussion until now. There is no reason there can not be a resonable tax discussion.

It will probably get moved.

[Flagg the Wanderer]

Originally posted by backofthepack
I 2nd the motion :archive: Oh, and I agree, BTW.

[Ras]

Originally posted by Undertaker #59
I was waiting to see if it turned into the typical partisan bickering. There was nothing left or right about the discussion until now. There is no reason there can not be a resonable tax discussion.

It will probably get moved.

That's because you're more than likely a Republican with leftists tendencies.

[Undertaker #59]

Okay okay

[Ras]

Originally posted by Undertaker #59
Okay okay
..or is it a Centrist with Republican tendencies?

[Undertaker #59]

Originally posted by Ras-Al-Ghul
..or is it a Centrist with Republican tendencies?

Me? I am mostly Libertarian.

[O_P_T]

Originally posted by Flagg Wanderer
Anything I missed? I'm sure I'm forgetting something...

Yup,

The concept of the rebate does add a progressive side to it, however, the table shown indicated that the rebate is for the "48 contiguous states".

It provides seperate rates for Alaska and Hawaii due to their different cost of living.

However, the cost of living within the other 48 states is no where near uniform. How does this system deal with these differences?

[spiderman]

I think this reform really misses the point.

Our focus should not be on how we collect taxes, instead it should continue to be on how our tax dollars are wasted. Our government is bloated, it takes too many of our hard earned dollars, and does too little with them.

I'm in favor of abolishing a great number of bureaucratic organizations, and privatizing whatever we can. Private companies, by nature, do more with less, and in the end it is the consumer (tax payer) who wins.

Why simply trade high income tax payments for high sales tax payments? It doesn't do anything to solve the fact that our tax dollars are wasted year after year.

[O_P_T]

Originally posted by spiderman
I think this reform really misses the point.

Our focus should not be on how we collect taxes, instead it should continue to be on how our tax dollars are wasted.

I recall hearing a proposition years ago that would do that.

Put a sunset provision into every single spending bill.

That is, after a certain number of years the funding would be eliminated unless it was re-aproved by Congress.

The only exception would be those programs that had some sort of "contractual" aspect.

For example Social Security, vetrans benifits, etc. since citizens essentially entered into a contract with the governement on those programs, that is they would provide a service or pay a tax with the understanding that they would receive a payment of some sort later.

The beneifit to such a program is that there are plenty of things that remain on the books because they had support in the past and simply haven't been repealed.

Mohair subsidies (http://govinfo.library.unt.edu/npr/library/reports/ag01.html) are the poster child for this problem.

It will also have the secondary benifit that if Congress has to debate and pass genuine funding bills it will leave less time for them to develop other grandious governement schemes.

[freak]

Originally posted by Benign Despot
Any serious look at a "fair" tax has to take into account the fact that we pay taxes to 3 different jurisdictions. Here in Mass we pay Income Taxes to the Federal Government, Income and Sales taxes to the state and Property taxes to the local government.

Most of these plans only target the Feds, the largest share to be sure, but still only a share.

However, that is exactly what the Founders intended. The issue is whether the Federal govt takes too much to accomplish it's Constitutionally assigned tasks.

State matters are an entirely separate concern, and the citizens of that state should take issue with those elected representatives.

Rest assured, that if a candidate for state office in NH ran on an income tax platform (either way), that it would be a prime concern for me.

[freak]

Originally posted by spiderman
I think this reform really misses the point.

Our focus should not be on how we collect taxes, instead it should continue to be on how our tax dollars are wasted.


I think it is both. Obviously the govt is bloated and provides far too little for what it takes.

But most people's issue with the current tax situation is over how much and who taxes are taken from.

Most "reform" plans deal with trying to determine a "fair" amount to take from the different economic classes.

As Flagg points out, a national sales tax would not be revenue neutral.

I think it should be a phased implementation. Reduce income tax rates, add a lower sales tax rate, and REDUCE GOVT SPENDING.

Without that last part, you'd be absolutely correct; "why substitute high income taxes for high sales tax?"

The problem still remains over what govt should provide. The 106th Congress TRIED to compel members to restrain themselves to offering only bills that could cite a specific power in the Constitution, as opposed to citing "the general welfare." But it did not require them to do so. And most people have come to simply accept that govt will do what govt will do. The hard part is coming up with a consensus on what govt should provide, and then restricting it to those functions.

[spiderman]

Originally posted by freak
I think it is both. Obviously the govt is bloated and provides far too little for what it takes.

But most people's issue with the current tax situation is over how much and who taxes are taken from.

I feel that primarily as Americans we need to continue with the attitude that we are over-taxed. By shifting our discussion primarily towards "fair tax collection" we are in essence saying that the amount of revenue collected by our government is fair, but it is the way that it is being collected that is unfair.

Americans are becoming too comfortable with supporting a large bureaucratic government which only seems to grow larger each year. Whether or not it is the middle class or upper class bearing the brunt of supporting it, to me is really a secondary issue. The primary issue is that we don't need so many governmental organizations in this country to survive, and the ones we do need to survive need to be scaled back considerably.

[freak]

Originally posted by spiderman
Americans are becoming too comfortable with supporting a large bureaucratic government which only seems to grow larger each year. Whether or not it is the middle class or upper class bearing the brunt of supporting it, to me is really a secondary issue. The primary issue is that we don't need so many governmental organizations in this country to survive, and the ones we do need to survive need to be scaled back considerably.

I don't disagree. But I think that most "reform" plans tend to focus on a "fair" distribution of taxes. And I don't think that is a coincidence......it's easier for a politician to get people up in arms by claiming that THEY are paying too much, and others too little. It's much harder to take something back once it's given, and to reach a consensus on exactly what govt should provide.

[spiderman]

Originally posted by freak
......it's easier for a politician to get people up in arms by claiming that THEY are paying too much, and others too little.

EXACTLY! Therein lies my point. Politicians can easily apply this band-aid and claim to have solved the problem. This is why I refuse to let them off so easily. It's going to take years to properly reform our government. I thought Newt Gingrich would be the guy to do it, unfortunately he was ruined by scandal, "cheating on his wife" (funny how that works out for some and not for others....hmmm). I don't see either party committing to any real reform anymore, the Republicans have simply become what the Democrats used to be.

[freak]

Originally posted by spiderman
I don't see either party committing to any real reform anymore, the Republicans have simply become what the Democrats used to be.

Bingo.

And I think this is a result of the way we've worked to hinder the development of a 3rd party. The whole system works against that.

Only the DNC and GOP candidate are automatically on the ballot. Third parties must have signed petitions, numbering in the tens of thousands, in order to get on the ballot. The Libertarian Party candidate, Michael Badnarik, was on 48 ballots.....more than Nader. They missed out on NH, for procedural reasons or something, and OK, which required like 20,000 more signatures than any other state.

Only the DNC and GOP are guaranteed a spot in the debates. Occasionally they let a guy like Nader in. This creates an atmosphere that suggests only the GOP and DNC are "legitimate."

The "winner takes all" electoral system. Even in '92, when Perot took nearly 20 million votes, he didn't garner a single electoral vote. Why would most people even consider voting for a 3rd party, when the system only allows them to play "spoiler" in a "battleground" state?

Further, one has to ask whether the "winner takes all" electoral college truly represents the views of the electorate. Here's how the 2004 election played out by county:

http://www.uselectionatlas.org/USPRESIDENT/GENERAL/pe2004USA_smr.png

Notice that most of CA, NY, IL, WA, OR, MI, MN, PA, MD, and DE went for President Bush (he uses the old Blue=GOP/red=DNC scheme). It's absurd to think that the 55, 31, and 21 votes for CA, NY, and IL respectively, accurately reflect the views of the whole state.

Yes, a majority of the population lives in a very small geographical area of that state, and care must be paid to the majority as well as the minority. But let's just say that LA and SF are distinctly different than ne and se California.

I think that more states should use a congressional district distribution of votes, as in Maine and Nebraska. While it is true that the winner of the state has still always swept, one only has to look at the county map to see that both states went overwhelmingly to the winner.

But take NH for instance. If NH gave each Congressional district 1 vote, with the overall winner taking the remaining 2 (as in ME), President Bush would have likely taken District 1.

Kerry would have still taken the state, and that would be reflected in his getting 3 of 4 votes, but the views of those living in District 1 would have been better represented.

The big difference would come in a state like CA. A quick comparison between the county electoral map, and a Congressional district map, suggests that President Bush might have taken anywhere from 1/3 to 1/2 of CAs 55 votes. Further, he may have taken a majority of votes in NY. Clearly, the Dems would be none too keen on that.

If the "winner takes all" electoral college were scrapped, people might be more likely to vote 3rd party, if they had a chance at getting electoral votes (which is the first step towards perhaps winning an election).

At the very least, a 3rd party could play "spoiler" at the national level, instead of simply in battleground states (even this was a non-factor in '04, after all the gnashing of teeth about Nader in '00). If a 3rd party were able to take electoral votes, particularly in a state like NH or WY (two finalists in the Free State Project), it would be tougher for the "heavies" to get the needed 270 votes.

A viable 3rd party would force the GOP and DNC to distinguish themselves, and reach out to voters in the middle. As it stands now, all they do is take varying (usually slight) stances on social issues, which are divisive, and unlikely to generate any sort of consensus among the voters (abortion, social welfare, gay marriage, etc).

[O_P_T]

Freak,

A few comments on your recent post.

The reason the DNC and GOP are automatically on the ballot is that the present rules stipulate that any given party has to receive a certain % of the vote in the previous election to "automatically" qualify for the next election.

For the GOP and DNC, this is a given, but it doesn't always happen for other parties.

Now there are +'s and -'s for such a system, but there is a certain logic to this system.

If one looks at the history (http://uselectionatlas.org/USPRESIDENT/) of Presidential elections in the US, one can see that it wasn't always a two party system and certainly not one between the GOP and the DNC.

If one allows any party that ever in history put forth a candidate to automatically be on the ballot, you'd have a huge number of potential candidates.

This isn't necesarilly a bad thing, but it could lead to confusion that would make the 2000 butterfly ballot problems look simple in comparison.

By the same token, restricting the debates to a limited number of candidates also makes some sense since if one has 5 or more debaters it is far more difficult to run the process as anyone who has watched any of the primary debates can attest to.

Again, not necessarily a bad thing, but not necesarily a good thing either.

The major "unitnteded concequesnces" of changing the electorial college from a "winner take all" process is that one will vastly increase the likelyhood of a court challange like we saw in 2000.

Regardless of what voting technology is used, there will always be ballots that can be disputed.

In a winner take all scenario, neither side is likely to challange the vote count unless the disputable ballots could make a difference in the outcome.

If on the other hand, one has the chance of wining some of the electorial college votes from each state, then there will be a motive to challange all the thresholds associated with each EC vote.

For example, assume that a state has 20 EC votes and there are 20,000 registered voters in the state ( completely improper numbers, but it makes the math easier).

In a winner takes all scenario, the only time either side would challange the outcome if it was close to a 10,000 vs 10,000 split.

In the split scenario, there would be motivation to challange at each 2,000 vote threshold since that would define each EC vote.

Even if one breaks the EC votes based on congressional district, this still increases the chance of challanges since there are now 435 districts in which the vote needs to be determined, and you still have to award the two senatorial EC votes in each state.

In addition, there is one argument one can make in favor of a two party system.

In theory, and practice, the two parties in the US do represent a relatively wide degree of political thought.

If one add's a third party, what is to prevent a 4th, 5th, etc.

Under these circumstances, one runs the risk of having parties based on relatively narrow political agendas as is seen in many European countries.

You also run the risk of having something like Italy where they have just about averaged a different government each year since WWII, since no one can maintain a majority for very long.

Now I fully understand that Italy uses a Parlimentary system, but there is no reason to assume that a vastly fractured Congress would perform any better than what we have now, and every reason to beleive that it is far more likely to suffer from gridlock since no party will have a majority

[freak]

Originally posted by O_P_T
The reason the DNC and GOP are automatically on the ballot is that the present rules stipulate that any given party has to receive a certain % of the vote in the previous election to "automatically" qualify for the next election.

For the GOP and DNC, this is a given, but it doesn't always happen for other parties.

I understand this. I'm just saying that the atmosphere it creates works against the development of a viable 3rd party. We can come up with a better way to "qualify" the parties.

If one looks at the history (http://uselectionatlas.org/USPRESIDENT/) of Presidential elections in the US, one can see that it wasn't always a two party system and certainly not one between the GOP and the DNC.

I'm well aware. But thanks.

If one allows any party that ever in history put forth a candidate to automatically be on the ballot, you'd have a huge number of potential candidates.

Don't get me wrong, I'm not suggesting that having dozens of parties would be better. I DO think a viable 3rd party would add some accountability to the system, and offer an alternative to the barely different GOP and DNC.

This isn't necesarilly a bad thing, but it could lead to confusion that would make the 2000 butterfly ballot problems look simple in comparison.

See above.

By the same token, restricting the debates to a limited number of candidates also makes some sense since if one has 5 or more debaters it is far more difficult to run the process as anyone who has watched any of the primary debates can attest to.

Having worked for the Democratic primary debate at UNH in 2004, I'm well aware of how things run. It wasn't THAT big of a deal.

The major "unitnteded concequesnces" of changing the electorial college from a "winner take all" process is that one will vastly increase the likelyhood of a court challange like we saw in 2000.

I think the Court challenges would be to the legitimacy of the new system (such as Congressional districting), rather than the legitimacy of the results. As I said, the DNC would certainly hate the Electoral College if it were run...as they'd have lost even worse. But as far as the results are concerned, I think it would prove less susceptible to court challenges. There would have been no doubt that President Bush won in 2000 and 2004. The challenge, IMO, would be an even more fierce attempt to eliminate the Electoral College.

In a winner take all scenario, neither side is likely to challange the vote count unless the disputable ballots could make a difference in the outcome.

No one seems to have a problem with electing Congressmen by district, so I think the validity question is moot. There would be gnashing of teeth by the loser, especially if they won the popular vote in a particular state, but let's think about the voters first.

If on the other hand, one has the chance of wining some of the electorial college votes from each state, then there will be a motive to challange all the thresholds associated with each EC vote.

This point would seem to have more merit if I were advocating a proportional system of allocating votes. The districting method is pretty clear. Win the district, which are well known, and take the vote.

For example, assume that a state has 20 EC votes and there are 20,000 registered voters in the state ( completely improper numbers, but it makes the math easier).

So take the districting method. A state with 20 votes, like say OH, would probably have 18-19 districts. Using the ME/NE method, each district gets 1 vote. The popular vote winner takes the remaining 1-2. Looking at how the counties did in 2004, Kerry probably would have taken 6-8 of OHs votes. But also looking at the percentages (the key for the shading is a separate image on the site), it's not a question of being close. The areas went solidly for one candidate or the other. And that's my point. It better represents the views of those voters.

In theory, and practice, the two parties in the US do represent a relatively wide degree of political thought.

It represents a lot of people inadequately.

If one add's a third party, what is to prevent a 4th, 5th, etc.

I don't have a problem if 4 (maybe 5) VIABLE parties were to emerge, but personally, I don't think this country could support more than that....IF that many at all. The issues our country focuses on tend to be much broader, with the narrow agendas marginalized on all sides. If a party runs on such a narrow platform, they would not generate a substantial following, and not be a factor. The key thing for me is a "viable" 3rd party. Right now, one does not exist, and the conditions in place work against it.

What does "viable" mean? For me, it means the potential of winning an election. It doesn't mean they will, but that the party has the potential to do so. For a 3rd party to build that potential, they'd need to also appeal to a wide range of people.

Under these circumstances, one runs the risk of having parties based on relatively narrow political agendas as is seen in many European countries.

See the top of my post. I'm not advocating that at all.

You also run the risk of having something like Italy where they have just about averaged a different government each year since WWII, since no one can maintain a majority for very long.

See above.

Now I fully understand that Italy uses a Parlimentary system, but there is no reason to assume that a vastly fractured Congress would perform any better than what we have now, and every reason to beleive that it is far more likely to suffer from gridlock since no party will have a majority

Again, you're assuming that I want more than a handful of parties or more. Let go of that (3 is ideal, imo).

A viable 3rd party would force the DNC and GOP to clarify who they are and what they believe. I also think it would force a Congress to work together to get their agenda passed.

Right now, if the DNC simply stalls and blocks the GOP, what is the voter's recourse? To not reelect their representative. Fine. Who are they gonna vote for now? Most likely, not the GOP, and a 3rd party simply isn't viable. So they vote for another Dem. Okay, but once he gets to Congress, the partisan bickering continues. If that Dem voter has a viable 3rd choice, say the Green or Libertarian party, it forces the DNC to work to keep that vote. Not just in promises, but in actions.

Remember, I'm not talking about trying to convince Congressmen from 5-12 (or more) parties.

[Flagg the Wanderer]

freak - would it bother you at all that the liklihood of having a President who had obtained anything remotely approaching a majority of votes would plummet?

Would that make the President a weaker figure both domestically and internationally, knowing that there's no way he can claim a mandate of any kind, nor even to speak for the majority of his people?

[Dave4Colts]

Originally posted by O_P_T
...there is no reason to assume that a vastly fractured Congress would perform any better than what we have now, and every reason to beleive that it is far more likely to suffer from gridlock since no party will have a majority [/B]

gridlock in government is GOOD. If they can't pass anything, then gov't doesn't grow!!

...of course there are exceptions to the rule...

[BuckWild]

Originally posted by freak
I understand this. I'm just saying that the atmosphere it creates works against the development of a viable 3rd party. We can come up with a better way to "qualify" the parties.

A viable 3rd party would force the DNC and GOP to clarify who they are and what they believe. I also think it would force a Congress to work together to get their agenda passed.

Right now, if the DNC simply stalls and blocks the GOP, what is the voter's recourse? To not reelect their representative. Fine. Who are they gonna vote for now? Most likely, not the GOP, and a 3rd party simply isn't viable. So they vote for another Dem. Okay, but once he gets to Congress, the partisan bickering continues. If that Dem voter has a viable 3rd choice, say the Green or Libertarian party, it forces the DNC to work to keep that vote. Not just in promises, but in actions.

Remember, I'm not talking about trying to convince Congressmen from 5-12 (or more) parties.

~quote edited for length~

Hey freak. While I can see the logic of your approach, I think you falter in one area. The fed is designed as a Republic of States. The states rights are meant to trump the rights of the fed except as designated by the Constitution. The electoral college is designed to require the person running for election as POTUS to convince a majority of the members of a particular state that they are the best choice. The EC allows each individual state to present a unified voice. By dividing up the EC votes by district as you suggest makes the EC nearly invalid and opens the door for a simple popular vote for POTUS, in effect eliminating the right of the states to speak for themselves as a state.

As for a third party, the key to them being succesful is for them to gain political clout at the local levels first. By winning seats in local and state gov'ts they can be better positioned to spread their word on political philosophy and policy. Asking for a third party at the national level before they can establish themselves at local and state levels is putting the cart before the horse. By pushing for and electing third party candidates at the lower levels of gov't we can bring these parties into the national spotlight. Succesful action at local and state levels can give third parties the legitimacy they need to compete at the national level. Without establishing a track record they will never compete for POTUS.

So, get out there and find a third party you approve of and promote them locally. We got to our present two party system through evolution, and we can again evolve to include an alternate choice, but it must begin at the grassroots level to have any hope of success.

[BuckWild]

A few counter-points Flagg, but I am not necessarily in support of the fair-tax plan presently proposed. I have a few changes.

Originally posted by Flagg Wanderer
Keep in mind as I say all of this that I'm fiscally conservative, even with a libertarian streak. On the surface, this is right up my alley. I advocated for something similar for quite a while.

But here's the problem. Well, here are the several problems:

1) It is NOT revenue neutral. More than ever, tax revenues would ebb and flow with the economy as people get scared and purchase less when things start getting a little scary - everyone, not just the people that get laid off.

I don't believe this is as much a problem as you feel it may be. The ebb and flow of spending isn't much more volatile than income. Furthermore, as you release income back to the people they will spend it


2) It's a little bit progressive by allowing rebates to Soc. Sec. recipients, and for "necessary" (whatever that means) goods up to the poverty line, but think about it - who spends a greater percentage of what they take home - a family of 4 earning 70k or a CEO earning 400k? This plan is helpful to the poor, helpful to the wealthy, and screws the middle class mercilessly.

The only way to make this plan work is to eliminate rebates all together. The prpoer approach to lower the tax burden on the poor is to lower or remove the tax all together on life essential goods such as certain foods, the gov't already has an organization in place to determine essential goods, WIC. WIC can be expanded to determine what goods and services should be considered essential and therefore be safe from taxation.


3) Further, by advocating for the repeal of the other taxes like on interest income and capital gains, it is even MORE beneficial to the most wealthy people in our society, who make a much greater amount of money through interest and capital gains than the lower classes.

This theory is faulty in that it assumes that rich people don't spend the money they earn. One near constant in our society is that the more one earns, the more one spends. The number of filthy rich people who live like paupers in this country is so incredibly small that it is of no significance.


4) It completely eliminates corporate taxation. I'm a pro-corporation kind of guy, and I hear the argument that corporate profits go back to the population through the distribution of earnings and capital gains, but again, that mostly benefits the wealthiest Americans. Not to mention that the structure of large corporations essentially ensures that all those increased profits will pad the bonuses of the top executives - the law of large numbers demands it.

This can also be alleviated by applying the sales tax to goods (ie raw materials) purchased by corporations to produce their goods. In this system the actual tax rate can be made very low because each purchase of material and goods is taxed. The auto manufacturer pays a sales tax on steel and then the car buyer pays a sales tax on the car made by that steel. Because of the multiple taxation of goods at different levels the actual tax rate can be made pretty low.


5) (and this is a big one) It puts the government in a position to encourage the American people to spend instead of save. While this can help the economy over the short and medium term, consumer debt in the U.S. is absolutely through the roof. It is not sustainable.

You forget that under this scenario the fed still controls the reserve and can manipulate consumer debt through interest rates. Consumer debt isn't sustainable at it's current levels and the fed is partly to blame because it set the conditions, low interest rates, that made consumer debt so attractive. A raise in interest rates would force people to save more. Yes this could also cause a slow down in overall purchasing rates, but this can be seen as a short term slow down until the economy corrects itself to a sustainable level.


6) Most corporate malfeasance and accounting errors (intentional or otherwise) are caught somewhere in the income tax accounting process (that is, through the IRS). The required accountings to Uncle Sam would be limited to solely revenue figures.

Here, the fuzzy math accounting of corporations is because they are trying to find ways to lower their tax burden and increase profits. By implementing a sales tax, the accounting errors lessen because the tax is applied at the time of sale and not at "tax time." A sales tax removes a lot of motivation for fuzzy math


7) Similarly, the only thing keeping corporations from employing illegal aliens en masse to save costs are those income tax reports that are filed - which have to jibe with the other accounting reports that they file with the IRS. This would be essentially putting up a neon sign inviting illegal alieans to come work here - putting citizens and legal aliens out of work in huge numbers.

Well, now you have a place to put all them IRS people back to work, tracking and regulating illegals.


8) Every accounting firm in the country, along with every tax attorney in the country, would immediatly be out of work. Ditto for 95% of employees at the IRS. If this was for something with serious long term benefit I could accept that as a short term cost, but considering 1-7 above, it's a big hit to take so that you can screw yourself over continually in the future.

Here you actually seem to be arguing for the subsidizing of a particular service provider. Sorry if I have little sympathy for lawyers, and the IRS workers can be shifted to fill other federal obligations like control illegal immigration.


Anything I missed? I'm sure I'm forgetting something...

Where I differ from the proposed plan is that I do not think the tax should be limited to only retail sales. This restricts the points of taxation too much and raises the tax rate to a very undesireable level. 23%?

I also differ on the rebate idea. Simply eliminate the tax on essential goods and services and rebates are not necessary, additionally the infrastructure needed to facilitate those rebates is not necessary.

Fire away!

[freak]

Originally posted by Flagg Wanderer
freak - would it bother you at all that the liklihood of having a President who had obtained anything remotely approaching a majority of votes would plummet?

I don't believe the liklihood would "plummet." Even in '68, when Wallace took 46 electoral votes, Nixon still won handily with 301. In '48, Thurmond took 39 electoral votes, but Truman easily won with 303. The use of a districting method would have given President Bush a rather substantial victory in both 2000 and 2004.

As for the effect of a 3rd party, my point is again that it forces the "heavies" to distinguish themselves and get voters.

You're viewing this in the light of today's strict partisanship. People often vote the lesser of two evils, or blindly vote a straight party ticket.

But the rise of a viable 3rd party would require a change of thought. Even if you give 3rd parties a "fair" chance legally, it would still require people to leave the GOP and DNC to become viable. Once you disrupt the partisan voting cycle, it becomes much easier to vote for the best candidate, regardless of the party.

[freak]

Originally posted by BuckWild

Hey freak. While I can see the logic of your approach, I think you falter in one area. The fed is designed as a Republic of States. The states rights are meant to trump the rights of the fed except as designated by the Constitution.

Why are you telling this to a person, who's political beliefs would best be described as traditional federalism?

The electoral college is designed to require the person running for election as POTUS to convince a majority of the members of a particular state that they are the best choice.

Or not. It was designed to give power to the small states, so that the states with large populations, weren't as dominant in the electoral process.

It requires a broad base of support throughout the stats. The "winner takes all" actually subverts this, as you can plainly see in the electoral maps. The DNC relies entirely on winning a handful of states with a large number of votes.

The EC allows each individual state to present a unified voice.

But it isn't a "unified voice." And that isn't the point of the Electoral College.

By dividing up the EC votes by district as you suggest makes the EC nearly invalid and opens the door for a simple popular vote for POTUS, in effect eliminating the right of the states to speak for themselves as a state.

Or not. The popular vote does not change. A districting method would have resulted in a clear win for the POTUS in 2000, despite the fact that he lost the popular vote. So your point is moot.

It was the "winner takes all" system that made the 2000 race so close. Had a ME/NE system been in place, the FL results would have been irrelevant, because the President would have won convincingly.

And as we know, it was the 2000 race that renewed calls to scrap the E.C. in favor of a popular vote. It doesn't work both ways.

As for a third party, the key to them being succesful is for them to gain political clout at the local levels first.

But you can't do that with the restrictions currently in place.

So, get out there and find a third party you approve of and promote them locally.

Why are you telling this to someone who DOES vote 3rd party?