Excuse me, but this is crap. My salary is negotiated with my employer, not some politician. Or are you assuming that the money I am currently paying to SS, Mediscare, and income tax will somehow just evaporate and I never get to see it?
Stop with the propaganda telling people that not only will they have to pay a 23% sales tax, they will get shafted out of THEIR money that is currently being paid to the government.
Oh and Bingo! You nailed it on the head...
It is crap, but that is the crap the fairtax expert assumed when he made all the glowing predictions fairtaxers constantly quote. When you hear all these great things the fairtax does for you, remember that is according to their model which says you take a cut in pay. Not realistic, but their model and you must understand the assumptions when listening to the results.
The next question is why would the fairtax expert ASSUME you will take a cut in pay? Simple, because if they don't, the fairtax will result in an immediate 15-20% inflation. See in order for prices to stay the same, ALL taxes must come out of the products, including all the federal taxes employees pay. It is all part of the deception of what fairtaxers call 'embedded taxes'. Those taxes include employee paid taxes, which they forget to tell you. This is why Boortz issued somewhat of a retraction to all his glowing claims.
I agree that the FairTaxers have no way to make this happen, but if salaries don't fall, then most of the embedded taxes aren't removed, and costs can't drop, so prices can't drop, so when a 30% tax is added to the top of the prices everything made domestically will cost 15-25% more.
Now if your paycheck is 25% larger, you could say no big deal. But this would shaft everyone on a fixed income or with savings. So this is a non-starter.
With the FairTax there are two options: #1) all prices go up and takehome wages go up, or #2) all prices stay the same (with the 30% FairTax included) and takehome wages stay the same (a cut in gross wages).
#1 is impossible because everyone with fixed income and savings is screwed.
#2 is impossible because people won't accept a cut in gross wages now that they've been promised a Free Lunch (in the form of 100% paychecks and no change in prices).
So, where does that leave us?