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“The upshot is a drastic increase in efficiency of tax collection, combined with an tremendous decrease in the amount of power the federal government has over you, personally.”

Yes, that is one of the brighter points of the FairTax. But that is true even if the FairTax doesn’t replace Payroll Taxes. Nobody complains about IRS audits or personal intrusion when it comes to the SS/M taxes. And if the SS/M is funded by a portion of FairTax, then retirees would be paying into SS/M at the same time they are drawing from it. In fact, the FairTax requires SS benefits to be adjusted upwards so the retiree will have enough money to pay the FairTax. That’s just silly. If we leave Payroll as a tax on wages, and we eliminate the prebate which would just leave huge blocks of voters off the tax rolls, we could have a FairTax with just a 12% rate. That would be a formula for smaller government — nobody gets a free ride while still voting for government largesse.

It’s probably true that sans entitlements the FairTax rate could drop probably a good bit lower and that would be fine were it possible eliminate payroll taxes and to pass the bill on that basis but it is not only a political non-starter but would give opponents the huge demagoguery tool of “regressive”, “hurting the poor”, etc.

I doubt it would be passed on that basis. To think that it would mean an automatic, unending upward spiral in the single tax rate, though, doesn’t seem reasonable to me since it would mean that each taxpayer would be encouraging his congressman to increase his own tax rate - an unlikely scenario. Indeed I think it would be more likely to happen in just the opposite fashion. The taxpayer by and large would be pressuring for a reduced tax rate.

My own preference would be to see both SS & MC eliminated period - but that’s probably not going to happen either. I’d certainly accept the compromise with the prebate and the slightly increased rate to get the tax system on a reasonable track. Certainly the present one is not.