Now I get it: you only debate the economics of the FairTax because we MAKE you debate them ... wow, I didn't realize we has so much power over you!
Nah, I just respond to your econmic silliness because that is what your concern is about.
I did a few posts ago ... but I guess you weren't paying attention. I rarely engage in the philosophical debate you desire, because, there's nothing to debate.
Great then you have no objection to a bill the replaces income & payroll taxes with a National Retail Sales Tax, in principle.
I don't disagree with your philosophical ends,
That is a comfort to here you say. And I am sure you have been a lifelong (fill in the blank) too,
I disagree with your technical means.
that just has these little concerns about marketing and presentation and thats why you reject the best NRST bills to be offered in the last century.
... so I don't give one hang as to what one economist says over another ...
Just noting the source of many of your and your cohort's talking points. It helps to understand where the dominant opposition is centered.
How tortured. The FairTax claims to be revenue neutral.
It does? I sure don't find it in the HR25 text, perhaps you can cite where that is in the bill's Findings section or anywhere else in there for that matter.
Granted the AFT makes that claim in their literature, obviously as a carryover from the bill's days of its authorship back under '96 taxlaw and when PAYGO rules were in effect and such a claim had relavence to overcoming floor challenges to stop a tax reform bill, that is certain.
Considering tax rates were higher back under '96 tax law, definition of "revenue neutral" under the old rules must still be obviously met, as we have a lower average tax rate today against a larger economy and the bill's rate of 23%, in fact the bill as a whole is still the same as its initial introduction back in 1999.
I indeed claim at 23% tax inclusive, HR2% it is far to high and would be burdening the economy and our pockets too much.
Under those old PAYGO rules defining the boundries of what is revenue neutral for floor challenge purposes, an OMB score of collecting than the taxlaw replaced met the revenue neutral criteria. IIRC AFT's claim is the bill would collect the same or more revenue than the '96 tax law of the Clinton years (the basis of the tax law when the bill was authored) the tax law we are slated to return to, if the Bush tax cuts are not made permanent.
I say it's not (albeit we disagree on the direction of "not")
You may say many things, doesn't make any of them true, as is indicated by the obvious aside in the parenthetic comment. Since I see the legislation as overly conservative to assure passing challenge of the OMB static scoring of it.
and you claim I'm the one demanding revenue neutrality ... your logic is a bit rusty ... it's probably that "paying attention" thing again.
Excuse me, you are indeed demanding that the bill be revenue neutral or even a rise in taxes, your argument is that it is not and should be made so. You indeed are the one demanding the criteria of revenue neutrality be met arguing the 23% legislative rate should be higher not lower. The one not paying attention here is yourself.
No, I'm claiming that the FairTax is misrepresenting it's claim of revenue neutrality ...
Let's see, a bill written in the 90's had to be certain to be scored as "revenue neutral" by OBM or it would never evern make it to a vote, any single congress critter could challenge it by raising the objection and demanding CBO scoring. If it failed the Scoring it would die right there.
Guaranteed the number in the text will pass the OMB scoring methodology, as the bill would die on the first challenge from the House floor under the PAYGO rules. Your claim can have no substance.
You have made it all clear now, I see you have actually have an objection to the Bush tax cuts. Apparently in your view we should not make them a target, to make them permanent and especially not try to implement tax cuts.
You instead appear to be arguing for a tax increase even above the Clinton adminstration's outrageous demands on us.
I am getting this right am I not? You want the the legislative rate of the FairTax bill to be set higher than 23%, which would assure burdening the taxpayer even more than that which was demanded of us during the Clinton years.
Foolishness!!!
The proper direction for change of the 23% legisative rate in HR25, is down.
It is far to high to implement the Bush tax cuts and make them permanent. In is most assuredly too high to provide an addition tax cut this economy sorely needs. Congress already grabs too much of our dollars, any additional they get a whiff of seem coming down the pike just encorages them to spend and grow government even more.
No way should the FairTax rate be higher, it should be substantially lower!!! into actual tax cut rage in absolute terms. Year-to-Year revenue collections by government should end up down, not growing as you would have them.
By my sights we should be looking instead to push Congress to make the Bush administration tax cuts permanent, and to implement even further cuts by elimnation of the AMT and similar onerous provision in the current tax system.
In fact we should squelch the silliness over revenue neutral bill of '96 law, (that obviously would collect too much today's conditions) and replace it with a rate that is at least targeted to make the Bush tax cuts permanent and even lower to assure true taxcuts are implemented and sustained going forward.
We are still on the wrong side of the Laffer curve in this current tax system, until there is a clear demonstration of falling revenues as a consequence of tax cuts, we need to cut rates and keep cutting them until we do.
With the growth of the economy, a consequence of lower tax burdens while on the upperside of the Laffer curve, revenues have recovered and have actually increased as since those cuts. The optimal rate of taxation is lower still, not upward as you apparently desire to see happen.
Seeing some rate must be set for a tax system, nows the time to do it, effective nation tax rate has not been down to the current levels since 1976.
It is time to take advantage while the iron is hot and nail the rate down under real tax cut conditions not the hoax conditions of Congress's out-of-date, sunsetted PAYGO rules with their OMB static analysis methodology.
As there is no longer a PAYGO rule requiring a revenue neutral condition, we should take the additional steps and implement tax cuts in real terms in reference to absolute revenue levels and free the economy up as much as we possibly can to take maximum advantage of conditions to effect a real constraint on government growth.
Pinch government's pocket books and make sure they have to explain any change in tax rate to the whole electorate, rather than allow Congress to pander to one the end constituency for votes in a rigged shell game of an income/payroll tax system.
You have made it clear where you stand in this particular debate. I take the side of lower burdens and constraint on government, not higher rate freeing government to do what ever it will.
My "criteria" as you put it is for the spec sheet to match the product. I don't really care WHICH one you fix, just make them match: (these are the easy ones)
WRT:
Wages: stop claiming that take-home wages will rise by the marginal income tax rate plus the ee payroll rate.Now for the harder ones:Wage/Price Behavior: stop double counting embedded wage taxes in both take-home increases and price reductions.
Revenue Neutrality: fix the tax rate to be truly revenue neutral, or drop the claim of revenue neutrality. (we'll argue about what that number is later.)
Tax Rate: state the fact that the actual tax rate is predicted to RISE over time despite predicted economic gains OR state that tax receipts will fall over time either necessitating significant increases in the deficit or significant reductions in spending. State/local taxes: either stop counting the benefits accrued from eliminating state/local taxes OR include state and local taxes in the tax rate.
Compliance costs: stop counting individual compliance cost savings as business savings/price reductions.
Competitive forces: stop pretending that competition will force price reductions in high-profit, non-competitive markets.
Entitlements: either admit entitlement spending will rise to match the FairTax CPI (with its corresponding impact on the tax rate or the deficit), or let recipients know the value of their transfers will fall.
Non-profits: Stop claiming non-profits will pay no tax on their purchases. Some will indeed be taxed.
Engage in a responsive debate about the range of likely consumer price increases. So far, you're still on Jorgenson's 20% which includes state and local tax conformance and constant take home wages -- HR25 doesn't do that.And, I'm sure there are other issues to be settled.Engage in a responsive debate about whether taxing state/local government spending actually necessitates state/ local tax increases.
Engage in a responsive debate about whether taxing federal spending actually raises any net tax revenue at all.
Engage in a responsive debate about the likely impacts of avoidance and evasion on the stated FairTax base. So far your still "stuck on static" proclaiming that there will be no change in evasion/avoidance behavior.
Engage in a responsive debate about who wins and who loses (virtually ALL economists predict losers -- stop hiding that fact.) Far as I can tell, you're in the "I don't care if there are economic losers" camp because you define winning as simply replacing the income tax with the FairTax: economics be damned.
Engage in a responsive debate about the impact of compliance cost savings on unemployment. As far as I can tell, you're in the "I don't care" camp (see winners/losers above)
Engage in a responsive debate about the difference between predicted economic gains and likely economic gains. So far, you're in massive-gains-land despite such gains being predicated on unrealistic simplifying assumptions, inaccurate modeling of the base-case, and wage/price behavior not consistent with the real world.
In short, whether YOU choose to engage or not, the FairTax will have to pass through this gauntlet of issues before it has ANY hope of becoming law. Given your emotional attachment to HR25, you might want to help it along by playing ball. Continued obstinacy against coming to terms with these issues will only serve to keep the FairTax in perpetual limbo.
If this is truly one of "the best NRST bills to be offered in the last century" then it ought to be able to stand on it's own merits ... not the misleading spin of its marketing machine.
Again, why are you so afraid of "truth in advertising?"