If Current Recovery Loses Steam, Economy May Face Real Trouble

THE WALL STREET JOURNAL ^ | August 18, 2003 | GREG IP

[xzins]

It isn't regressive....it is equal.

EVERYONE should pay something, otherwise I own the country more than they do, and I have more of a right to speak out than they do. After all -- I'm paying their way. Irresponsibly, they're just along for the ride. In fact, I could argue that I'm more of an american than they are.

The same percentage sales tax for everyone will have those who consume a lot spend more (at that same rate) and those who spend little pay less (at that same rate.)

The unequal (so-called 'progressive') tax is idiotic for this reason, too: everytime you cut taxes, you cut more people off the tax rolls. After a while you have so few paying taxes that you break them and their productivity.

Tax cuts mean that you will eventually have to change a progressive tax structure to a more sane means of collecting taxes.

Cyclical economies mean that you will have to keep offering tax cuts OR increasing taxes. EITHER WAY you break those who are producing.

[LibertyAndJusticeForAll]

This article is downright hilarious in its effort to avoid the LARGE elephant in the middle of the room.
Not once did it mention a failing trade policy that has lost millions of manufacturing jobs, or all of the offshoring/outsourcing, or 1 million visa workers or millions of illegals taking American jobs.
All of these are major contributors to unemployment yet not one is mentioned.
And, unemployment itself is not given its due importance as the stumbling block to any real recovery.
And the economists sound annoyed with the poor guy who didn't work most of 2002 who now is very fiscally careful. They want him to spend, spend, spend to stimulate the economy. Well, he's not stupid, stupid, stupid, like they are.
Greenspan, the Bush economic team and others are all deliberately ignoring the impact of high unemployment and its causees, and instead are saying they have "run out of ammo".
How BLIND can they be? Why are they pretending not to see the elephant in the middle of the economic recovery?

[Cronos]

lifting their debts to 111% of income

I think THIS is our real problem -- debt to income ratio is 1:1.11, are WE CRAZY????

[harpseal]

However in order for the economy to continue to grow without increased employment we as a nation need thsi ratio to rise which is just plain stupid. So lets address the structural problems that have us in this condition.

[harpseal]

You have been added to my ping list for articles dealing with trade and the overall economy. If this is not your interest let me know.

[harpseal]

Regarding the national retail sales tax please talk to me more about it when it could possibly get past Congress and be signed into law. It may or may not be a good idea but it has zero chance of coming close before 2008 and I can not predict beyond that. The politicains do not want it and not even a consensus of most conservatives are behind it yet.

You will note I did not address the merits of your case.

[xzins]

See #21.

The progressive tax is self-terminating, given economic cycles and stimulus tax cuts...(each cut takes more off the rolls forever....eventually no one will be left to pay, and the few who are will be overburdened to the point of extinction.)

At some point they MUST expand the tax base and get more people paying again.

They will need some "less noticeable" way to reimpose taxes on those who no longer are paying taxes.

Sales taxes, paid at the sales register, are nearly 'invisible.'

[.cnI redruM]

Yeah and if I got a bad case of hemmerhoids, it would really be a pain in the @$$!!

[A. Pole]

It isn't regressive....it is equal. EVERYONE should pay something, otherwise I own the country more than they do

Why not to make it perfectly equal - a flat percentage tax on property - after all the more you own you need more state protection of your property. People who own nothing should pay nothing. (People who own less than zero ie are in debt should get tax credit so they can be free and interested in defending the system). This is simple and mathematically logical. Income on the other hand is the way to create property - so abolish tax on it for all.

Instead of national sales tax introduce FOREIGN sales tax ie tariffs as Founding Fathers and American Constitution prescribe.

Those two taxes (property and tariffs) will be equal and sufficient.

[txhurl]

No. Property taxes are awful: they're why we get irrecoverably f-up gov. budgets when sharp recessions dissipate the tax base.

Additionally, tax foreclosures are terrible reminders that nobody really owns property: gov. is just leasing it to you.

[A. Pole]

Additionally, tax foreclosures are terrible reminders that nobody really owns property: gov. is just leasing it to you.

Maybe there should be a waiver option - you can resign from the state services like police/court protection etc. You could hire you own guards and build roads, water supply to your property. For the military you could contribute your service or hire some troops on you own for the common defense. It worked in the middle ages.

[xzins]

I believe something should be taxed only once, and after that it is tax paid personal property.

If you tax at the time of sale, then you are taxing property. Those who spend more (the rich) will pay more. All, however, will pay the same percentage.

God saw no problem with charging everyone the same percent....10%

[Jorge]

Ah yes... there is always dark lining on the silver cloud.