Posted on 04/18/2017 3:49:49 AM PDT by IBD editorial writer
In an article headlined 'That GOP 'Middle Class' Tax Cut Might Be a Big Fat Trojan Horse For The Rich," a Huffington Post writer set out to attack Republican tax-cutting plans.
There's nothing new about decrying tax cuts as giveaways to the rich. Democrats spent years trashing President Bush's tax cuts on those grounds, and the first chance President Obama had, he raised the top tax rates.
But in making his case, Huffington Post senior White House correspondent S. V. Date inadvertently reveals a dirty secret about our current tax code.
Namely, despite endless claims that the rich don't pay their "fair share" of taxes, they actually pay more than their fair share — much more, in fact.
(Excerpt) Read more at investors.com ...
You do realize imports reduces GDP right? GDP = C + G + I - (Imports - Exports). That again doesn’t even count the impact of loss of wage base and tax base with lowering the money velocity, which also lowers GDP.
Fair is not the point.
Revenue is.
The Fair Tax seems like a good idea - tax consumption rather than achievement (income).
Though I can’t wait to see its unintended consequences. But I doubt they will be any worse than they are for income taxes. The IRS certainly won’t be going away as some might have hoped.
It would be more accurate to say imports are neutral to GDP. The increase in C (consumption) cancels the negative associated with imports.
But labor specialization does increase GDP in the long run and a society with high imports has high labor specialization.
In theory yes, but this doesn't account for the fact the tax base on imports - both the income and on labor - go to the foreign country rather than the domestic country, which hurts GDP. This wouldn't matter, though, if we were trade deficit neutral - but we aren't. In fact, real GDP growth and real median wage growth began to fall off at basically exactly the time our trade deficit took off (late 90s) and has averaged only 2.0% GDP growth since that massive trade deficit compared to 3.5% GDP growth in the decades before then [real median income has performed even worse]
But labor specialization does increase GDP in the long run and a society with high imports has high labor specialization.
Three issues with this - one the US is big enough and has access to every resource on the planet - that it can specialize itself in really everything efficiently. Back when John Locke and other influential thinkers wrote about specialization of nations, a country like the USA is today didn't exist. Second - the way it's suppose to work with trade deficits this large though is the currencies would correct to balance out trade deficits. Since the US is a reserve currency and every major government on the planet manipulates their currency to some degree, that hasn't happened and won't. Third, we don't have free trade. We allow people to ship their goods into the US, they get a border tax credit (refund) in their home country and pay nothing in taxes here. When we ship a good to say China or Germany, its taxed here, and has a VAT tax added there (effectively what we're calling a border adjustment tax).
Naturally, you are correct. We may be beyond the tipping point for being able to restore our government and nation through Constitutional means. So long as we have activist judges, politicians who pick and choose what parts of the Constitution they honor and Congresses unwilling to impeach lawless politicians and judges - we have no government as the Founders and Constitution intended.
It will take a miracle, bloody revolution or civil war to restore us to a government that respects, honors and obeys our Constitution as originally intended.
Ping
To drain the swamp the 16th Amendment must be repealed.
Americans at almost every income level are paying a smaller percentage of their salaries in federal taxes than they were 10, 20 even 30 years ago.
The richest 1 percent of households in the nation pays 25 percent of all federal taxes.
The richest one-fifth... ― paid 69 percent of all federal taxes collected by the U.S. Treasury that year.
The poorest 20 percent saw their average federal tax rate drop from 8.7 percent in 1983 to 3.3 percent in 2013. The next one-fifth of households saw their federal tax rate drop from 12.8 percent to 8.4 percent.
Only the wealthiest one-fifth saw their average federal rate go up, from 23.8 percent in 1983 to 26.3 percent in 2013 -http://www.huffingtonpost.com/entry/republican-tax-cut_us_58f14cbce4b0da2ff860eaff?ncid=inblnkushpmg00000009
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