Posted on 05/05/2006 1:35:32 PM PDT by RobFromGa
In my letter to Rep. Linder and Mr. Boortz of August 24, 2005, I pointed out a number of what I called “serious misrepresentations” of the Fair Tax plan contained in “The FairTax Book”. I specifically named many of these by page #.
Now that the revised second issue is out, let’s see what they did to these passages in the book:
First edition page 55, you go on to explain that these embedded taxes are “in addition to the money taken out of your check in income and payroll taxes.”
Second edition- this line was eliminated. This means that they are acknowledging that the 22% embedded taxes INCLUDE the income and payroll taxes which was one of my points all along.
First edition page 59, “Once the FairTax takes effect, you’ll be receiving 100 percent of every paycheck, with no withholding of federal income taxes, Social security taxes, or Medicare taxes and you’ll be paying just about the same price for T-shirts and other consumer goods and services that you were paying before the FairTax.”
Second edition- “Once the FairTax takes effect, you’ll be in complete control of your paycheck as nothing will be withheld and your purchasing power for t-shirts and all other goods and services will be almost exactly what it was before the FairTax.”
This means that they are acknowledging that “purchasing power” will remain the same, not a big increase in purchasing power as they previously asserted with their larger paychecks/same prices verbiage. They eliminated the “100% of paycheck” wording.
First edition page 83: “Remember that the poor, along with everyone else—will no longer have Social Security taxes or Medicare taxes removed from their paychecks. Whatever they earn, they get on payday. For most of those we categorize as poor, this would mean an immediate 25 to 30 percent increase in their take-home pay.”
Second edition- “Remember that the poor, along with everyone else—will no longer have Social Security taxes or Medicare taxes removed from their paychecks. Whatever they earn, they get on payday. If employers leave this money in paychecks instead of taking it out of price, most of those we categorize as poor, this would mean an immediate 25 to 30 percent increase in their take-home pay.”
Of course, this acknowledges that the employer has a choice to make—to pay the worker his current paycheck and not reduce prices (meaning prices with FairTax added go up 30%) or to cut paychecks to present takehome levels. They cannot both give workers more takehome pay and reduce prices. The Free Lunch described in the first edition is eliminated.
First edition, page 84, you make it clear though that even though the workers will keep all of their paychecks for a big raise, you still believe that because of “the disappearance of the embedded taxes, the total price paid for consumer goods will remain very nearly the same”.
Second edition—“when you factor in the combined lower prices/higher takehome pay caused by the disappearance of the embedded taxes” prices will remain about the same.
This again acknowledges that they money currently deducted as taxes can either be used to increase take-home pay or reduce prices but not both at the same time. If they were being more honest here, they would have referred to purchasing power remaining the same rather than prices, but they are trying to put the best possible spin on this major admission.
First edition page 111, you tie it all together with a Quick Review in which you erroneously assert that “Here’s what happens when we pass and implement the FairTax plan:
“We start collecting 100 percent of our earnings on our paycheck.
“We all get virtual raises, since payroll taxes are no longer siphoned from our checks.
“The prices of consumer goods and services remain essentially the same, with the removal of the embedded taxes compensating for the added consumption tax.”
Second edition:
“We start controlling our earnings in every paycheck” (whatever that means)
“100% earnings” line is eliminated from the second edition. "virtual raises" is likewise eliminated.
“Our purchasing power for buying consumer goods and services remains essentially the same, with the removal of the embedded taxes compensating for the added consumption tax.”
This is a MAJOR difference in the Quick Review! In the first edition, they promised larger paychecks and prices remianign the same—which means a major increase in purchasing power. Of course this was a ridiculous promise. In the second edition, they say our purchasing power will be about the same.
They still left a lot of wrong and misleading verbiage throughout the book, but they addressed most of the concerns that I sent to them and removed those claims in the second book.
Have you seen people in poverty?? They don't spend.
Whether it's people on a fixed income or those who don't have an income.. they don't spend unless it's completely necessary. ANY sort of a prebate would be welcome.
By the way, I see your bias in the comments like "fairy tax". Are you still keeping an objective eye to the facts or are you just running your position into the ground?
Abolishing the 16th is a step in the right direction.
Spoken like someone who has an unbelievable love affair with the income tax.
How do you like being required to report all of your personal business affairs to your government?
Do you see no value in no longer being required (at the point of a gun) to do so?
I see you're still in tenth grade with your buddiesEternalVigilance: "You must have went to Clown School".
Wow! you should be very careful with your comments about someone elses level of education...Or ain't you had no learn'n?
How do you like being required to report all of your personal business affairs to your government?So, again, you refuse to answer the question (you even changed the question), so I'll ask again - "how long did it take you to do your taxes."
Do you see no value in no longer being required (at the point of a gun) to do so?No one has ever pointed a gun at me to force me to report my income. That's just more of the standard EV hyperbole.
You have no interest in honest dialogue.
Nothing new there.
I posted a whole comparison sheet for you to look at. Get back to me when you want to discuss particulars. I won't hold my breath.
You have no interest in honest dialogue. Nothing new there.Me not interested in honest dialog? I've answered your questions. You've refused to answer mine. Who's not interested in honest dialog?
(Denny Crane: "Every one should carry a gun strapped to their waist. We need more - not less guns.")
Well then why have the fairtaxers been using that Jorgenson quote for the last 10 years.
Perhaps you would like to point out the precise "Jorgenson quote" in the '96 tesitmony to which which you suggest is being used.
It is understandable that replacing all payroll taxes (i.e. SS & Medicare) as well and implementing a sales tax rebate to all legal residents as the Fair Tax Act HR25 does would improve performance even more. This is especially true considering that Jorgenson's simulations make no provision for removal of the cost burdens of tax compliance, legal and audit costs, or of tax planning and implementaions of tax avoidence mechanisms at all.
The only thing I see in his '96 testimony (to which his statements to RobFromGa refer) is a reduction in producer prices. Testimony in which he makes no mention of any effect with regard to wages. In other papers and studies he suggests lower price to the consumer combined with the tax producing an overall increase in consumer purchasing power of 3% in the first year rising to 10% in out years through an implementation of NRST replacing only income taxes.
Replace both income and all payroll taxes, add provisions for sales tax rebate, as is easily perceived the potential for even better results will be substantially increased.
I did nothing of the sort. A moment ago, you agreed
I personally wouldn't care if the tax percentage was 50%...Now, suddenly, it's the rate that's important...
...make up your mind.
You claim the visibility of a retail sales tax is key, yet you can't even hazard a guess as to how much retail sales tax you paid ... the tax is "hidden in plain sight" much like it would be under the FairTax. It's the equivalent to death by a thousand cuts: no one cut kills you, but after a while you lose count, lose consciousness, then lose it all.
As for my income tax, I know EXACLY how much Federal Income Tax I paid; I know EXACTLY how much payroll tax I paid, and EXACTLY how much payroll tax my employer paid on my behalf.
The only indirect tax I paid was the portion of Business Income Taxes owing directly to the Corporate Income Tax. Since the Corporate Income Tax accounts for less than 1% of the price of goods and services, you can treat my share of that tax much like you treat the FairTax. I paid less than an additional 1% of my disposed income. (In 2002, $153 Billion in Corp Income Tax was paid on $17,545 Billion of business receipts - prices: tax was 0.88% of price.)
Now; How much did you say you paid in California Sales Taxes??? Any clue??? I's right there on your several hundred receipts.
We'll work on that...when you get around to the many dozens of important issues I've raised to you and your buds...with nary the chirp of a cricket to show for it...over the last couple of years.
Simplicity.
Visibility.
Benefits to savings and capital formation, and thereby to productivity levels.
Efficiency.
Benefits towards remedying our trade imbalances, and finally forcing foreign producers to pay to play in our market, the largest in the world.
Benefits in the world market to our manufacturers.
Fairness/equality/equal protection of our laws.
And finally FREEDOM.
People who shill for the Income Tax and IRS hate freedom...
No you don't. Not even close.
Neither plausable, or feasible. The economy would crash instantly.
I paid whatever percentage the state and locality I was in collects.
Like most of your assumptions, your assumption that I live in CA is faulty.
The only income they make is social security. At least that's what my grandparents make. Had they not saved over the years, they'd be screwed right now under the CURRENT POLICY.
My Granparents pay property tax, auto insurance, medical insurance payments, pharmacy bills, Dr bills etc...
They are extremely frugal. That's how they have income now to live and survive. They grow a good portion of their own food. They do not spend unnecessarily as I do. If they had 2K a year in prebate, they'd pay for their insurance costs alone.
Thier biggest expense is paying for their medical supplements.
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