New head of OMB was on CSPAN yesterday and was sharing info on future projections and deficits in the federal budget.
He said that just past 2016 we will have a spike in SSI and Medicare costs.
the Interviewer asked "how is this sustainable" It is not without major tax increases or spending cuts. This is the legacy that SQLs want to leave the next generation????
With the Fair Tax you are taxing a larger tax base which is considered more stable than income.
The key is it is larger and as GDP grows so does tax revenue.
It will collect taxes from the illegal income area when they spend money in a restaurant, jewelry store, Walmart or Target.
It will tax illegal and undocumented workers often paid in Cash when they go to WalMart.
Those without valid Social Security numbers will not receive the Prebate.
Long term it is a better for business to be making decisions based on value to the business and not based on tax loopholes and compliance that are inefficient for the economy and for that business.
The future in a global economy is not looking good for American jobs if we keep the status quo tax system.
We do not want to compete by making all jobs minimum wage do we?? and shipping the rest overseas???
We can compete better globally with the lowest tax system on business and business investment in the world with the Fair Tax.
Eliminate the headache and regulation of the income tax code and you will see Daimler Chrysler headquartered in the US instead of Germany.
You won't have companies like Stanley Tools wanting to move their headquarters to the Bahamas.
You will make it more costly to move jobs to India and Chinia and cheaper for business to build manufacturing facilities and create jobs in the US.
Even it the Fair Tax was neutral for every family and neither a net gain as I beleive nor a net loss as you beleive But neutral; These other benefits can not be found in the Satus Quo or in other tax reform plans.
Looking at all the potential benefits, the FairTax is the better way to go for America's Future.
Wouldn't You Agree??? If Not what is your solution???
Good post. Thanks for all your posts.
You will make it more costly to move jobs to India and Chinia and cheaper for business to build manufacturing facilities and create jobs in the US.How is it going to "make it more costly to move jobs to India and China"? And businesses aren't moving their manufacturing facilities overseas because of taxes, they are doing it because of labor costs.
... you continue to use a series of false claims about the FairTax, and you continue to ignore specific rebuttals to those claims. I've asked you twice to discuss them (on another thread), and you have, so far, run away from the discussion. It appears you are more inclined to cover your eyes and hold your ears than you are to discuss the problems.
Since you started with it, let's talk specifically about the SS/MC problem:
You are confusing tax policy with spending policy. Social Security and Medicare are not tax system problems, they are first spending problems, and second out-sized welfare programs that need substantial and immediate reforms. The primary problem with both programs is that neither is funded with investment. As such there is no creation of the necessary capital to sustain the systems. Merely opening the lid on taxing current generations to pay beneficiaries (as you are suggesting) is nothing more than a tax increase to fund an ill managed, bloated system of welfare programs and will mask the true cost of the programs while removing the impetus to attack systemic reform.
As I said in another thread to you: Folding SS/Medicare funding into the general system of taxation is the WORST thing you can do.
The first step to reform is deciding the purpose and objectives of the programs. The original objective of SS was to clear the decks of aged workers to make room for young workers with families who were out of work because of the depression. SS was the ticket to entice older worker to retire and open a job slot. That purpose is no longer served, yet the program has changed little.
I propose making the purpose of both SS and Medicare to serve as a the safety net of last resort to catch those that fall through a system of heavily incented, even mandated, self funded privatized accounts that sustain people in retirement.
First, both systems (SS/MC) should be replaced with self-funded private account systems. Contributions to these systems should be mandatory, as today, to a minimum level of contribution. That contribution, and any excess contribution to such accounts should be tax free: tax free now, tax free forever. These accounts should be managed as investments. The investment gains should be tax free: tax free now, tax free forever. We may wish to cap tax free contributions at some level, but that level should be high enough for an individual to salt away substantial sums of money to fund a comfortable retirement WITHOUT ever needing a dime from the government.
SS/MC programs should be sunsetted in favor of this new approach. Your level of participation in the current programs should be adjusted to reflect your years from retirement. Those near retirement can continue to participate fully in the current system; those farther from retirement will have a reduced benefit from the current system; those with 25 years or more until retirement will be completely transitioned to the new system.
In the interim, the current system should be altered to add a means test. Beneficiaries with adequate means should receive reduced benefits or have their benefit eliminated completely.
If there remains a funding deficit, then we need to bite the bullet and pass a special tax, linked directly to the underfunded programs, and with a specific sunset provision, to fund the shortfall.
In short, the SS/MC problem has NOTHING to do with the Income Tax system and is NOT solved by the FairTax. In fact, as proposed, the FairTax makes reforming SS/MC more difficult by removing the urgency of a funding shortfall.
Reforming SS/MC as I propose can reduce the cost/size of government by nearly 50%! You're "solution" amounts to throwning more money down an endless hole.
Anytime you're ready, let's talk about those false claims you keep using. Perhaps when you realize you're advocating a pipe dream, you might come around.