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To: frogjerk
Unfortunately, given the nature of government, this never happens... :(

Under the NRST, they would have to.

Hamilton, in the Federalist Papers, talks about how taxes on consumption are self-leveling, like water. If you raise the rate too high, revenues will fall at some point, not increase.

Politicians, faced with falling revenues, would have two choices: cut spending, or try and raise the rate. The problems with choice two are A) That move could be quite politically unpopular...and B) Doing so could easily reduce revenues even further, because of the higher prices discouraging consumption.

This natural dilemma for politicians can be nothing but a win/win for a free people.

This is a simple principle that every American who is trying to understand fundamental tax reform needs to get through their skulls.

69 posted on 06/10/2005 12:05:52 PM PDT by EternalVigilance ("Quality of life": Another name for the slippery slope into barbarism...)
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To: EternalVigilance
Politicians, faced with falling revenues, would have two choices: cut spending, or try and raise the rate. The problems with choice two are A) That move could be quite politically unpopular...and B) Doing so could easily reduce revenues even further, because of the higher prices discouraging consumption.

You forget that cutting spending is politically unpopular as well. If this was not the case we wouldn't have so many "entitlement" increase promises every election cycle...

73 posted on 06/10/2005 12:09:36 PM PDT by frogjerk
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To: EternalVigilance
Unfortunately, given the nature of government, this never happens... :(

Under the NRST, they would have to.

Given the fact that the government has run in the red for the better part of the past 3 decades, I don't see why a switch to the NRST would suddenly stop them from continuing to run in the red and borrow borrow borrow.

85 posted on 06/10/2005 12:13:17 PM PDT by Phantom Lord (Advantages are taken, not handed out)
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