Well, that is one of the central points of debate. Others on this and other threads are indeed claiming that after-tax prices will fall WRT real wages (ie. wages stay at pre-FairTax gross levels, and producer -- pre-tax -- prices decline enough to allow after-tax prices to remain roughly constant ... that won't happen.
most people will be paying less taxes with NRST than without it.
Hmmmm ... this is where the devil really IS in the details and opinions aren't worth a whole lot. Perhaps we can dig into that claim on another thread.
Dramatic growth is over time not immediately.
Actually no, the dramatic growth is in the beginning. Jorgenson predicts GDP to jump 13.2% in the first year then fall to 9% over the base case over time. Investment (a component of money supply) jumps 78% in the first year before settling down. The labor supply jumps 30% in the first year. It's not at all clear that these discontinuities, coupled with pricing behavior, will not be inflationary.
The rate is set by law as well as the base
... and that is no different than it is today.
In general you display a lot more faith in Congress than I have. Which masses are going to oppose raising the tax on vacation homes, luxury yachts, private aircraft and such in exchange for a healthcare consumption exemption or rebate? You're dreaming if you think this new law with its ability to buy massive numbers of votes is immune from tampering.
Tax leaks are plugged at collection points
Unless the leak is somewhere else ... if people are trading in under-the-table new goods, none of them, represents a collection point. The Bill makes the taxpayer liable for the tax, not the collection agent. If a taxpayer (not the retailer) is suspected of cheating how does he prove his purchases are legitimate? Who has the burden of proof?
People will at least have the opportunity to send a message that they dont now.
This is another area where your faith exceeds mine. First, most expenses by most people go to food, housing, clothing and transportation. Food is off the table; people are no more inclined to stop eating or grow their own to protest tax policy than they are to protest current prices. New housing represents a too small transaction volume to be representative of massive protest, and operating costs fall into the food category: you gonna turn off your electricity because you think the tax is too high? Used clothing ... to protest tax policy??? Finally transportation. First gas: not even a doubling of fuel price has significantly dented demand ... you think people will stop driving to protest tax policy? As for new car purchases, presuming a significant enough boycott of new vehicle purchases to get congress's attention (how many quarters of boycott are needed?) what do you think will happen to the folks employed by auto manufacturers?
Besides, any boycott of taxable goods is likely to have an inflationary effect on the prices of substitutes making the substitutes less attractive. I am not put off by you questioning authority, but would hope you really investigate and consider the NRST and not stay with preconceived ideas.
Sadly, this comment represents a common belief among folks I've debated with here. For some reason, they seem to think I (and others of my ilk) have not "really investigated" the NRST. I won't pretend to guess how much time I've spent finding, reading, and understanding dozens of publication by dozens of economists on this topic. I don't now how many times I've sifted through the NIPA tables or Tax Stats. I can't even begin to adquately estimate the hours I've spent in constructing my own models based on those publications. And I'm embarrased to think of the number of hours I've wasted responding to people here who either ignore, avoid, or simply attack that investigation then dismiss it out of hand without bothering to actually ponder what is said. There is no debate here with some; there's only dogma.
I came into this discussion several years ago with no preconceived notions. I looked into the claims, I did the reasearch, I asked questions, I pondered the responses, I did the math, and I reached conclusions on my own ... some in agreement with the FairTax, some in opposition to the FairTax.
The least you could do is leave room for the possibilty that some of us who disagree are doing so from a perspective of knowledge and integrity.
Right-oh, Dimples. Exactly which of the FairTax conclusions might it be that you reached that were in agreement with the FairTax??
Do you really expect to be believed when you try the old "I'm only trying to be discern the truth" stunt by claiming you came aboard with a pure heart and friendship in your soul? Your "years ago" posts that I recall sound like nothing of the sort but rather that you have always opposed the FairTax. Claiming otherwise now is (at best) a tad misleading.
The continual pretense so many of you display reminds me of some of the pacifists in Britain before WWII - they thought Hitler was really a good guy down deep who had the best interests of Germany at heart and that he should be "given a chance" to straighten out Germany - all this in spite of his obvious efforts to arm his country for war. Many of these folk were in favor of any number of the "Hitler reforms" because they were as intellectually pure as you.
Their tune changed before 1940 for most though, and then they typically claimed then to always have viewed him with "concern". If you oppose the FairTax there's nothing wrong with honestly saying so. The pretense is what is so ghastly.
With a tax system such as the FairTax I DO believe that consmers will trim their buying habits if they don't like the rate. Trying to fit that into an income tax scenario which is what you're trying to compare it to is meaningless since any such protest at present would serve no purpose at all.
The present tax system encourages - in fact, almost mandates - consumption in preference to savings and investment while under the FairTax the opposite is true which causes a reduced consumption to be more effective and more noticeable to government. In fact, the reduction of consumption will be magnified by the fall-off you mention and rather than adversely affecting a particular industry in moe than the short run (if at all) will merely help the government to notice the taxpayer displeasure more quickly due to pressure from that industry and react to it by rate decreases. In connection with any such decrease there would be an increase in savings and investment to offset ill effects so it is anything but a one-way street.
Lastly, Dimples, you're a fine one to talk about some having "dogma" on these threads as you have continually refused to accept reality when presented to you in no uncertain terms and have made outlandish claims of absurd reasoning in attempting to defeat the FairTax. I might point out that you haven't done so.