Posted on 10/19/2006 5:11:50 PM PDT by pigdog
Knock off the personal attacks!!This whole "stop the personal attacks" bit you've been playing lately is really making me laugh. It's kind of like Kim Jung Il saying "No More Nukes!"
But the savings themselves lose no value and even the income earned could also be plowed back into more savings. Your point is not made.And when those savings are eventually spent, they are taxed. Their real value will always be reduced by the amount of the FairTax whether they are spent immediately or saved for twenty years.
We seem to be saying different things. You're saying the prebate can be spent and certainly it CAN. It can also be saved and not spent. Either is beside the point of the use of the prebate in the Calculator where it is intended to reduce taxes paid - it's conceived use as a tax rebate - so that an accurate comparison between the two systems can be made on an even basis.
It isn't an "error" at all but, apparently, a use which you do not understand. If anything, forcing in into spending would be an error from the standpoint of the Calculator since that would increase spendable income with no offsetting increase in spendable income on the income tax side thereby biasing the results in the Calculator.
It isn't an "error" at all but, apparently, a use which you do not understand. If anything, forcing in into spending would be an error from the standpoint of the Calculator since that would increase spendable income with no offsetting increase in spendable income on the income tax side thereby biasing the results in the Calculator.No, by not including all the FairTax a person would pay you are reducing the gross tax paid. And then when you reduce the gross tax by the "prebate," you get an erroneously small net tax paid.
Removing the income tax is only one, small factor is the cost of a house, market forces play a larger part. If people have more disposible income, it is more likely that prices will increase as home buyers compete with eachother.
"No, by not including all the FairTax a person would pay you are reducing the gross tax paid. And then when you reduce the gross tax by the "prebate," you get an erroneously small net tax paid.What a shock it is that this error benefits the FairTax comparison."
And if the prebate is not spent but saved then it is not taxed so your point is meaningless as one cannot presume if will be spent and as I said the fact of doing so biases the Calculator and does not fulfill the purpose it was designed for - which was a comparison on an apples and apples basis of the effective tax rate when the same level of spending occurs.
"What a shock it is that this "error" you try to claim (which is not an error at all) benefits the anti-FairTax comparison."
The assumption is that it will be spent - thus the name prebate. In addition, the FairTaxers claim that people always spend up to and exceeding the poverty level no matter what their income. Isn't that the justification for the amount of the prebate - projected spending for family size based on the poverty level?
About your assets, why did you accumulate so much outside of tax deferred accounts? You say you spent a lifetime saving this money. If you had used IRA's or something similar you would have had a much more rapid compounding of returns than you did outside of these. I've found the best combination is about 50-50 taxable and tax deferred. Most of the problems I encounter is with people who have too much in tax deferred accounts.
That statement can be a putt that breaks 15 times before it drops in the cup. Savings can also be a base from which to accumulate wealth. Savings can also be an emergency fund and create peace of mind. Savings can be passed on the future generations. Savings can be collateral for leveraging in your business or personal accounts. The amount of savings you have can literally determine HOW MUCH you spend on any given thing.
Technically, you are correct. But in the real world savings are used for many things.
And if the prebate is not spent but saved then it is not taxed so your point is meaningless as one cannot presume if will be spent and as I said the fact of doing so biases the Calculator and does not fulfill the purpose it was designed for - which was a comparison on an apples and apples basis of the effective tax rate when the same level of spending occurs.And if it is not spent IT HAS ABSOLUTELY NO VALUE. The government might as well send out Monopoly money or just not send it at all.
"And if it is not spent IT HAS ABSOLUTELY NO VALUE. "
See #569.
From the Kotilkoff et al paper:
"Nominal federal transfer payments TR that are not taxed under current law must remain high enough to command the same goods and services under the FairTax as they do under current law."
"As you requested, I provided a link and the quote - "exact phrase""
No, you didn't - all you posted was to present a part of your original post. What I asked for was the source you obtained that comment from - and you didn't provide it.
"What steps will government then take to bring retirement money and spending back home? "
The very "steps" that are embedded as part and parcel in the bill ... making the U.S. the world's largest tax haven.
If embittered individuals choose to leave the US, they're certainly free to do so - but that's been going on for a long time now due to the income tax. More will undoubtedly be returning with their capital once they see the FairTax has passed. They'd be foolish from an economic standpoint not to.
"... The assumption is that it will be spent ..."NO, it isn't. Not for the purpose of the Calculator as I've explained several times. Look up one of he posts if you're interested.
Savings can also be a base from which to accumulate wealth.Wealth that's only value is in what it can buy when spent.
Savings can also be an emergency fund and create peace of mind.I assume this emergency fund would be spent in case of an emergency. Correct?
Savings can be passed on the future generations.And they might as well be Confederate dollars if they aren't spent.
Savings can be collateral for leveraging in your business or personal accounts.Acquiring debt is considered "negative" savings. You are effectively spending your savings.
What does the Kotlikoff quote have to do with what I said."And if it is not spent IT HAS ABSOLUTELY NO VALUE. "From the Kotilkoff et al paper:
"Nominal federal transfer payments TR that are not taxed under current law must remain high enough to command the same goods and services under the FairTax as they do under current law."
No, you didn't - all you posted was to present a part of your original post. What I asked for was the source you obtained that comment from - and you didn't provide it.Are you now admitting that you did ask for quotes?
NO, it isn't. Not for the purpose of the Calculator as I've explained several times.Yeah, but we know what the purpose of the calculator is. It's the same as the rest of the FairTax propaganda. [Hint: it's purpose is not the truth.]
Acquiring debt can also be "positive" savings. How else are you going to build luxury condo's for sale? What if all of your savings is in rental property? You've spent it right? Debt for investment sake is good and the amount of debt you are able to acquire can be directly dependent on your savings. It's easier to borrow against a CD than against a house that hasn't been built.
You can't read???
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