OK ... STAND BY FOR ME TO GO BALLISTIC ABOUT FAIRTAX OPPONENTS

NEALZ NUZE ^ | April 10, 2008 | NEAL BOORTZ

[Turret Gunner A20]

OK ... STAND BY FOR ME TO GO BALLISTIC ABOUT FAIRTAX OPPONENTS

Twenty two million dollars. For those of you who do better with numbers than letters, that would be $22,000,000.00. That's the amount of money spent to come up with the original FairTax plan. This money was spent on research by economists and other financial groups; on focus groups across the country; and on comprehensive studies of alternative ways of raising revenue for the operation of government and the consequences of those various methods.

Twenty-two million bucks, and day after day we have to suffer the uninformed and frankly unintelligent slings and arrows launched by people who left their rational reasoning skills far behind as they started their life's journey, or who are so deeply steeped in their petty jealousies and wealth envy, nurtured, no doubt, by their own feelings of personal failure, that they couldn't form a cohesive and rational thought about the FairTax if their very lives depended on it.

I present for you here two letters to the editor that appeared in the Atlanta Journal-Constitution on Wednesday, April 9th. Following each letter I'll deliver the appropriate verbal thrashing and try to set the record straight.

Want a nation of masters and serfs?
Regarding the letter "Learn facts about FairTax, please" (@issue, April 3): While studying the FairTax, I discovered that its core is a consummate cut of any obligatory federal taxes. That leaves the wealthiest in our country with no federal taxes to compensate the U.S. for the gifts showered upon them or to keep the wealth gap at a sane level. FairTax supporters are looking toward a state of chaos if they succeed. Our present plutocracy will become much worse, a country of masters and serfs.

WILLIAM L. FELL
Athens

Well my, my my. What do we have here? Does it look to you like Mr. Fell (a very prolific letter writer, by the way) may be suffering a bit from wealth envy? How do you like his assertion that the wealthy in this country (however he might define that) had "gifts showered upon them." This is part of the tired old leftist, anti-capitalist saw that the wealthy in our country did no real work to earn their wealth, it was just handed them; or "showered upon them," as Mr. Fell says, or, as Dick Gephardt liked to say, they "won life's lottery." In any event, these leftists are loathe to admit that the wealthy actually worked their tails off for the wealth they enjoyed. Those destined for wealth were working 60 and 80 hour weeks while those destined to remain in the middle class were looking at the clock just waiting for quitting time to come around.

What upsets Mr. Fell so much about the wealthy? Well .. he has two choices here. First, he can work hard, make correct choices, delay gratification and become wealthy. Second .. he can make poor choices, work his 40 hours a week and go home and completely fail to plan for his financial future .. and remain right where he is right now. But .. .if he chooses the latter, he certainly won't be willing to take the blame for his plebian economic status. He'll give himself a pass by trying to convince himself, and others, that those nasty rich people just had wealth "showered upon them." Other than the fact that they got a shower of riches while he got the proverbial golden shower ... he's just as good as they are.

Yeah, right.

Fell thinks that under the FairTax the "wealthiest in our country" will pay no taxes to the federal government. Let's give him a break. There's always the possibility he was educated in government schools. Besides, his left-leaning outlook has poisoned him to the concept of achievement.

First of all, what Mr. Fell may not realize is that the "wealthiest in our country" are quite possibly not paying income taxes under the present system. And why not? Because they're already wealthy. They don't need to work any more. They let their investments work for them. Let's take the case of Warren Buffet. Several months ago Buffet, with great fanfare, announced to the world that his secretary paid a higher tax rate than he does. Well, duh. His secretary pays income taxes. Warren Buffet pays capital gains taxes. Capital gains taxes are maxed out right now at 15%, and that would be lower than the rate his secretary pays on her salary. Funny how the leftist media didn't bother to point out that little fact when they were touting Buffets thoughts on comparative tax rates.

So what happens to these evil rich people --- the ones who had these gifts "showered upon them" after passage of the FairTax. Well, right now if Mr. Gotrocks takes $4 million out of a savings account, or if he sells something he doesn't need anymore, and uses that $4 million to buy himself a fancy new yacht for his Naples, Florida waterfront home ... he pays nothing to the federal government. He may be socked with a hefty state sales tax ... but for the feds, nunca.

After the FairTax, however, there would be a 23% national retail sales tax embedded into the price of that yacht. My government school math tells me that Mr. Gotrocks would actually be paying about $920,000 to the feds. This, to the brilliant and envious Mr. Fell, constitutes "no federal taxes."

The FairTax is the only tax reform plan out there that COMPLETELY untaxes the poor at the federal level. This isn't enough for Mr. Fell .. he has to make sure that the rich get soaked. After all ... it's not as if they worked for that money, right Mr. Fell?

Now .. onward and upward to the second letter:

Older workers would suffer

Although I didn't write the original letter "FairTax wouldn't be fair to many retirees" (@issue, March 29), I disagree with the rebuttal "Learn facts about FairTax, please": The main problem with a substitute "fair" sales tax is not that it may discriminate against those with a low income, notwithstanding complicated formulas to compensate them that the rebuttal writer claims will be in place, but that older workers, and particularly retirees, have already paid hefty federal and state income taxes on their savings. Their investments in Roth IRAs, CDs and similar savings would be heavily taxed again when they cash them for everyday living.

ROBERT KRIETE
Lawrenceville

We'll be a little more gentle with Mr. Kriete because he seems to be expressing an earnest concern about the FairTax, a concern not based on wealth envy as was Mr. Fell's.

Kriete is concerned that people who have already paid federal taxes on the money they sacked away in their savings accounts, IRAs and CDs will have to pay a tax again when they take that money out and spend it during their golden years.

I've encountered that particular question dozens of times, and it is fully covered in "FairTax, The Truth: Answering the Critics." The point, Mr. Kriete, is that when these people take that money out of their savings or retirement accounts and spend it at the retail level they're going to pay taxes one way or the other. Under the present Income tax scheme they're going to pay the (average) 22% embedded tax that exists in every product or service purchased at the retail level. With the FairTax comes the end of all business and corporate income and payroll taxes and the end of this 22% tax embedded in our goods and services. Then along comes the FairTax to replace the embedded tax. So, Mr. Kriete, you see that a $700 riding lawn mower or a $16,000 Harley is going to cost pretty much the same after the FairTax as before. In one case you're paying the embedded taxes brought on by today's tax structure, in the other case you're paying the FairTax. Six of one, half a dozen of the other.

Now, Mr. Kreite, before you go .. .here's another point to consider. Not only will retirees be paying essentially the same for whatever they buy after the FairTax as before, the FairTax will also bring them their monthly prebate checks. Let's say that your retirement household numbers two. Under the FairTax you will receive a check or credit to some bank account every month equal to the FairTax you will be paying that month to purchase the basic necessities of life. Nobody --- not you, not the evil rich guy down the street, not Mr. Fell, not The Talkmaster .. .nobody who is a legal resident of this country will have to pay the FairTax on the basic necessities of life. That prebate check to you, Mr. Kreite, will be several hundred dollars a month. You'll pay no taxes on investment income. You'll pay no taxes on the interest you earn on your savings accounts. There will be no tax on your estate when you die. You will pay no capital gains taxes if you sell some stock to take a nice vacation. You will only pay the FairTax. That's it as far as federal taxes go .... PLUS ... you get that prebate check every month and the price of all the stuff you want to buy remains essentially the same. Do you still think it is such a bad deal? There's hope for you, Mr. Kreite. For Mr. Fell ... not so much.

[Mr. Jeeves]

...households earning under $50,000.00 a year pay NO taxes Federal or state.

It was in part Reagan's push toward that latter goal that got us in this mess. People who pay no taxes have no stake in the outcome of their voting decisions and are free to support every irresponsible demagogue who promises to reward them with free money. Everyone should pay, all the way down to zero.

[higgmeister]

Only the manner of collection is different...

That is the biggest only in the world. Christmas is only a holiday. Baseball and golf are only games.

The IRS will be gone, defunct, kaput, finito. No more self-aggrandizing bureaucrats empowered by government, yet with no constitutional authorization, to subjectively or arbitrarily adjudicate citizens. the FairTax will bring open and obvious tax collection that will reveal the true cost of government on our lives.

[Turret Gunner A20]

The biggest problem with the Fair Tax is that the politicians and bureaucrats are too heavily invested in the current power structure to allow it.

Here is why -- and the article shows how it can be fixed:

http://www.freerepublic.com/focus/f-news/1994419/posts

It is up to the voters to get off their butts and vote the rascls out.

[lewislynn]

yet with no constitutional authorization, to subjectively or arbitrarily adjudicate citizens.

NEWS FLASH! The Fairtax doesn't repeal the 16th if that's what you're getting at.

the FairTax will bring open and obvious tax collection that will reveal the true cost of government on our lives.

Right. The same people that never look at their check stubs or tax returns will be blown away with:
Increased take home pay.
Prices the same as now or lower, including the tax.
More money for savings.
Reduced interest rates.
Easier to buy a home.
A government check in the mail every month.

Or maybe those promises aren't really true.

Which is the lie?

[higgmeister]

How many times have you seen this by now?

From Congressman Linder's Web Page:

Q:

Once the FairTax is passed and becomes law, what protection is there against a reinstitution of the income tax at a later date?

A:

The short answer is that you the voter are always the best defense against new taxes, old taxes, and any tax in between. Even so, the FairTax does envision even more protections being built into the language and the law of the FairTax itself.

The Sixteenth Amendment, which was ratified in 1913, gave the Congress explicit authority to enact income taxes, because the Supreme Court ruled, in its 1895 Pollack v. Farmer's Loan Company decision, that such direct income taxes were unconstitutional. While some legal scholars argue that an income tax could have been legal even in the absence of the Sixteenth Amendment, I certainly believe that the repeal of the Amendment is an important symbolic and functional step in returning power over taxation to the people.

If the FairTax is enacted, I expect that the Congress and states would promptly begin consideration of legislation to repeal the Sixteenth Amendment. To make certain that occurs, however, I am in favor of adding language to H.R. 25 during the 110th Congress that includes a sunset provision, meaning that either we succeed in repealing the Sixteenth Amendment within 5 years after the implementation of the FairTax or the FairTax goes away. In my view, we simply cannot risk having both a national income tax and a national sales tax in place at the same time.

H.R. 25, however, cannot include legislative text that itself repeals the Sixteenth Amendment. To become law, the FairTax simply needs a simple majority approval by both the House and Senate and the signature of the President. A repeal of the Sixteenth Amendment requires a House Joint Resolution (H.J. Res) and the approval by two-thirds of the U.S. House, two-thirds of the U.S. Senate, and three quarters of the 50 states--the standard that all constitutional amendments must meet for passage. Therefore, we must move legislation that repeals the Sixteenth Amendment separately from H.R. 25.

Q:

Does the FairTax repeal the 16th Amendment?

A:

Yes, the FairTax plan does foresee the repeal of the Sixteenth Amendment, but, no, procedurally the repeal cannot be included in the text of H.R 25. Let me explain. The Sixteenth Amendment, which was ratified in 1913, gave the Congress explicit authority to enact income taxes, because the Supreme Court ruled, in its 1895 Pollack v. Farmer’s Loan Company decision, that such direct income taxes were unconstitutional. While some legal scholars argue that an income tax could have been legal even in the absence of the Sixteenth Amendment, I certainly believe that the repeal of the Amendment is an important symbolic and functional step in returning power over taxation to the people. The FairTax, H.R. 25, cannot include legislative text to repeal the Sixteenth Amendment. To become law, the FairTax simply needs a simple majority approval by both the House and Senate and the signature of the President. A repeal of the Sixteenth Amendment requires a House Joint Resolution (H.J. Res) and the approval by two-thirds of the U.S. House, two-thirds of the U.S. Senate, and three quarters of the 50 states--the standard that all constitutional amendments must meet for passage. Therefore, we must move legislation that repeals the Sixteenth Amendment separately from H.R. 25. If the FairTax is enacted, I expect that the Congress and states would promptly begin consideration of legislation to repeal the Sixteenth Amendment. To make certain that occurs, however, I am in favor of adding language to H.R. 25 during the 111th Congress that includes a sunset provision, meaning that either we succeed in repealing the Sixteenth Amendment within 5 years after the implementation of the FairTax or the FairTax goes away. In my view, we simply cannot risk having both a national income tax and a national sales tax in place at the same time.

This is from the author of the bill, yet you still posture and parse selectively without even trying to honestly consider the proposal.

[lewislynn]

How many times have you seen this by now?

Actually I've never seen it and it's less than worthless...AND, nothing there changes the fact that the Fairtax bill (HR25) DOES NOT REPEAL THE 16TH AMENDMENT.

This is from the author of the bill, yet you still posture and parse selectively without even trying to honestly consider the proposal.

Apparently I'm the only one who knows what the proposal really says. Anything Linder says on his website is nothing more than him "posturing" and your wishful thinking his website is "a proposal".

BTW, he's not the author of the bill, only the stooge sponsor....He's not smart enough to author a tax bill.

[higgmeister]

Actually I've never seen it and it's less than worthless...AND, nothing there changes the fact that the Fairtax bill (HR25) DOES NOT REPEAL THE 16TH AMENDMENT.

Neither Congressman Linder nor Neal Boortz ever told you it did "REPEAL THE 16TH AMENDMENT."   There is no subterfuge, yet you and your ilk bring that up at every opportunity as if someone was telling lies to dupe people into working to implement the FairTax. The mendaciousness doesn't come from Boortz or Linder. It is obvious who the mudslingers are.

[lewislynn]

Neither Congressman Linder nor Neal Boortz ever told you it did

I never said they did...You did, or tried to, so now you're back peddling.

[foxfield]

The FairTax is an interesting idea and certainly better than our current psuedo-Marxist model, but it’s not the long term answer IMHO.

What do you suggest is the long term answer?

[Turret Gunner A20]

Which is the lie?

Just about everything you post.

Any more stupid questions?

[MarcB]

One thing I keep seeing missed by the retirees is that most of the money that has been saved, has been saved in tax deferred accounts set up for retirement. This fact just seems to be passed by when talking about the Fair Tax beating up on retirees. No tax has been paid on those savings yet! So most of this argument goes out the window to start with. Now with the fair tax, they still won't have to pay the income tax on the monies brought out of all these tax deferred accounts to start with, so this money IS NOT being taxed twice like some skeptics like to scream that it is.

[Turret Gunner A20]

If that’s your only reason for not investigating the FairTax any further, then it is obvious that you lack the capacity to understnd it even if you did look into it in depth.

[foxfield]

...because of this writers offensive column and your mean post, I have decided to be against the fair tax from now on...

That's a really lame excuse.

This FairTax issue is controversial and contentious. There are many who have, or think they have, a vested interest in the current system. Many will say and do anything to stop open and fair discussions of the issue. Sadly, it is hard to resist retaliation in kind when they start with personal attacks. Stick around and you might see what I mean.

That having been said, you really owe it to yourself to keep an open mind and to make your decision on the merits, or lack of thereof, not because of distasteful comments made by others.

[Principled]

The Fairtax replaces income tax dollar for dollar, the base is the same...income.

Oh my. This parallels your finest.

The bases are not the same. I really can't believe you just said that.

[Principled]

The income tax has as its base income.

The nrst has as its base retail consumption spending.

Those bases are not the same.

Further, the base of retail consumption spending is significantly larger than the base of income. So it is trivially obvious that a lower rate on consumption is possible.

[longtermmemmory]

I think the “22 million” is some sort of present day tax dodge expense ala algore’s selling of carbon credits to himself. Only speculation but it seems substantiated based on the lack of actual thought and practicality of the HR 25 document.

Seems Neil is just recycling the same old same old.

We need a DIFFERENT proposal, this fairtax scam is doa.

[foxfield]

We need a DIFFERENT proposal, this fairtax scam is doa.

Two questions. Do you have a different proposal in mind? What about the FairTax makes you think it is a scam?

[Rob112586]

Abolish the Federal income tax completely, along with the Federal Reserve and a ton of domestic spending and entitlement programs. Of course, this is a LONG LONG LONG term hope and considering the GOP is just the pro-war liberal party while the DNC is the anti-war liberal party we’ll never see any sort of true tax or currency reform.

[Nebr FAL owner]

Since when has it been mean to encourage others who admit they are uninformed on a topic to study & then make an informed decision ???? Boortz has a right to be annoyed ! He is lied about by people who have a stake in the current cl*st*rf*ck of a tax system & by pundits & newspaper editorial writers who literally were to lazy to do even a google search on the background of the fair tax .

[MarcB]

Agreed sadly the fairtax won’t come into being until we have economic crisis that will leave this country looking like the Weimar Republic.

If I’m not mistaken we are there now!