Posted on 09/17/2006 8:03:05 AM PDT by Principled
A Battlefield for Tax Reform
There are a few significant battlefields in the war for tax reform. One of them is Free Republic. What makes the Free Republic battlefield significant is that the debate is at the cutting edge. The debate on Free Republic is the most current and most knowledgeable. It is a year ahead of other significant battlefields (radio talk shows, political town-hall meetings, conversations among neighbors and coworkers.)
The trend on Free Republic with respect to tax reform is going to show up in the real world. Free Republic is a tiny segment of the world, albeit a more educated, more politically motivated, more affluent segment than most. Perhaps those are a few of the reasons that Free Republic predicts what will happen in the real world – the world of radio, newspapers, network television, and most importantly - elections.
The choices are
Keep the status quo and continue with our graduated income tax
Eliminate the income tax and implement a flat income tax (although this option has negligible support)
Eliminate the income tax and implement a national sales tax
There are no other options. We are going to have taxes. The only choice is deciding the best way to have them.
Whichever choice you prefer, one thing is clear. The opponents of tax reform on Free Republic will stop at nothing to protect the status quo. Here’s what’s happening on Free Republic (remember it’s a predictor of what will happen in the real world.)
Opponents of reform randomly select perceived problems, however insignificant, and say that’s the reason this reform cannot work. For example, attackers of HR 25 (the “Fair Tax”) have alternately said the rate is too high and then the rate is too low. Whatever seems to get traction is what they stick with. Is it no wonder the perception is that these anti-reformers are not being honest with the reason(s) they oppose the reform. This is why so many question the motives of the anti-reformers. What are they hiding?
The anti-reformers try to make the reform threads so unpleasant that people choose not to participate in them (what does this predict about the real world?)
An anti-reformer may be taking advantage of the positions he he was entrusted with by the site (modertor). By taking sides in threads, berating and belittling pro-nrst posters, by deleting threads, by locking threads, and by moving threads from news/ACTIVISM to “Bloggers and Personal” and to “Smokey Backroom”, the mod(s) in question are taking away from the greatest site on the internet. Sometimes, threads are moved to bloggers and then moved to SBR or vica versa.
Pro-nrst posters are suspended for things that don’t make sense. Anti nrst posters are not suspended for things that should require it - comes to mind the picture of a dog copulating with a pig with the comment “screw you pigdog”… “I found a picture of your parents”. Noteworthy is that the poster of said graphic and phrase were not suspended but rather the recipient of it was suspended for complaining about it.
What does this predict about the real world?
Suffice to say that the debate about tax reform is won by the reformers. The proof is that when educated about the three reform options, the general public chooses the nrst over 70% of the time.
The only question is whether the dishonesty of the anti-reformers will slow the progress of reform in the real world. This is NOT to say that all anti reformers are dishonest - but it is the dishonest ones who are tainting the others.
The good thing about the debate is that the nrst is the most thoroughly investigated alternative - each and every point is debated in complete detail. Problems have been identified and some changes have been made. That's a good thing. And as debate continues, the level of knowledge of any lurkers continues. As I said, I predict over 70% will choose the nrst.
Sorry Groanup - I pinged you but forgot to tell you I was asking you about the pre-tax savings vs post tax savings figure. IIRC you are in that arena professionally?
The nitpickers say that the retirees that have all of their savings in after tax money will be hurt. In a stretch that COULD be right for the wealthier ones. If so, it should be easy to do some Peter/Paul type of thing with the legislation since the pre-taxers will receive such a HUGE bump in their buying power.
If you'd do some rational examples using reasonable numbers for the tax free part of spending under the FairTax to get to the likely effective tax rate, I believe you'd find things much less alarming.
I can't answer that question because I don't have enough information.
You're backtracking severely? Why's that?
It's because you know the rebate is a refund. Your assertion that the rebate is an "entitlement" is empty scare.
What's your real reason to object to the nrst?
If someone receives regular gifts of food, clothing, and housing from a charity, who pays the tax? If a church gifts a destitute member with a used car, who pays the tax? If the rental value of a home one owns is counted as an expenditure, who pays the tax?
An in kind gift may be counted as an expenditure when measuring certain economic activity though no money has changed hands, and I assume, no tax would be paid even under the FairTax.
What is interesting, is that FairTaxers make the claim that even the impoverished "spend" up to the poverty level when justifying the prebate, and present tax free purchasing opportunities (legal evasion) when promising the tax "will be good for you too".
What's your real reason to object to the nrst?
Economists can therorize what the effects of the FairTax will be, but without actual experience, nobody knows.
For instance, experience in other countries has shown the sales taxes over 12% are difficult to collect, a fact poo pooded by the FairTaxers.
You apparently do not know the origin of this particular urban legend, but since you choose to promulgate it, let's see your background material.
Since you oppose the FairTax with every peculiar reason you can dredge up, your position seems to be that your opinions hold more credence than, say, an economist who has studied things of this sort for his life's work???
Interesting!!!
"An in kind gift may be counted as an expenditure when measuring certain economic activity though no money has changed hands, and I assume, no tax would be paid even under the FairTax."
Had you actually read the bill, you'd have known the answer to this "assumption".
You said you rejected the rebate because it represents an entitlement. But there will be fewer negative rates under the nrst than the income tax as evidenced by the BLS data link above.
So your reasoning is faulty. If you really were concerned about minimizing negative tax rates, you would be in favor of the nrst because it reduces negative tax rates to a negligible number. See the BLS data above.
So why do you pretend to want to minimize negative tax rates?
I've already posted it.
All economists do not agree.
I don't understand your argument. Perhaps you would restate it with examples.
I must have missed it since I've not noticed it on this thread. Please post a link to the information I requested.
LOL!
You have not, after all, presented any economists showing (using the actual specifics of the bill itself) that the FairTax will be deleterious to the country in some fashion.
There's an example. Enjoy.
The information you need is in the BLS table and the rebate table for the nrst. The information isn't the problem. It's all there.
The reason you don't answer is because your reasoning has betrayed your true position IMO.
If you were opposed to people getting negative tax rates, you'd favor the nrst because it has fewer. But you don't favor the nrst.
So then you were not truthful when you said you thought the rebate was an entitlement and that's the reason you object to the nrst.
Can't have it both ways. Which is it?
Oh jeez Louise! Now your claiming that the FairTax catches more poor people in its net than the income tax? Unbelievable!
That seems to be a matter of opinion.
You might want to read A National Retail Sales Tax: Consequences for the States
(The authors ask not to be quoted or cited without permission)
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