Posted on 05/06/2009 11:57:23 AM PDT by Turret Gunner A20
Interest and appeal in the fair tax is gaining momentum around the country. The last couple of weeks of rallies have proven it.
The present tax system has becomed to burdentsome to handle. Fair tax all the way.
A specific example that most everyone has seen. A person has a monthly paycheck of $2500 under the FairTax, and so they get to keep all of it. This person decides to spend all $2500 on a brand new computer but will receive an instant rebate of $300. So the person purchases $300 more goods in the computer store before checking out. They go to the checkout stand, they spend $2800 and that is reflected in the total at the checkout stand. But when it comes time to pay they hand over only $2500 because of the instant rebate.LOL! Another name for it is discountAnd there you have it. A person’s pay is less than what they spend. And no credit cards involved!
So after this idiot gets home and tells his wife he just spent $300 more than his entire paycheck at the computer store and she makes him return it all. How much will he get back? $2800 or $2500
If you said $2800 put on your dunce cap and go write 'I am an idiot' on the chalk board 100 times.
If the computer is returned, then the customer receives $2500 less the $300 rebate or $2200. Unless the customer returns what was purchased with the rebate, they will get less of what they put in.
This is not at all difficult for most people to understand.
But YOU can believe what you want.
***The fact is that when you spend and get a rebate, and spend the rebate, you spend more than you had to begin with.***
And everyone that has had an instant rebate knows exactly how that works.
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But keep on trying to spin this example. Most people will know exactly how my example works and when they see your lame ‘rebuttal’, it makes for good advertising for our end.
Here’s the principle again in a nutshell:
***The fact is that when you spend and get a rebate, and spend the rebate, you spend more than you had to begin with.***
If the computer is returned, then the customer receives $2500 less the $300 rebate or $2200.You didn't answer the question because it exposes your ignorance or are you really that stupid?
When his wife made him return ALL of his purchases would he get refunded $2800 or $2500...
When you answer that using grade school math and kindergarten logic instead of Fairtax double talk you'll figure out how much he spent.
BTW, because his "rebate" was subtracted "at checkout" and not discounted on the shelf, he would have to pay 30% tax on his purchase with the (so called) rebate money.
His total out the door expense under the fairtax (after the $300 rebate) would have been $3336.36...He would have indeed needed a credit card just to pay the $836 Fairtax (33.44% tax) on his $2500 purchase.
I answered the question that people understand.
Your posts are useful to show the mindset of the small group of anti-FairTax hecklers that visit these threads.
As to your question, the customer would receive $2800 less the rebate of $300 or $2500.
It still doesn’t change the following principle:
***The fact is that when you spend and get a rebate, and spend the rebate, you spend more than you had to begin with.***
“Also total collapse will not happen as the USA holds the winning cards in the global economy. The only way to take those cards away is to defeat her militarily.”
I could not disagree with you more strongly. I would recommend reading a book called “Three Billion New Capitalists - The great shift of wealth and power to the east”. Its author, Clyde Prestowitz, makes the case that a unique set of circumstances enabled the USA to achieve by far the highest standard of living on the planet in the second half of the 20th century. Those factors are fading in importance and have been doing so for some time now.
Most students of globalization understand that China’s economic growth has just begun and that their economy will be as large as ours within the next couple of decades. Cysco, for example, expects China to be at the center of information technology between 2020 and 2040 and they are making plans to be a Chinese company by that time. Intel’s chairman has said that globalization is not a threat to his company, since they will move their manufacturing and R&D wherever they have to in order to remain globally competitive, but as a grandfather and a US citizen, he does worry about what his children will be doing to earn a living.
In spite of two world wars, the Great Depression and several lesser economic and military challenges, the US economy grew by about 21 times during the 20th century. Most serious students of globalization believe that the Chinese economy is poised for a similar expansion during this century.
The prevailing notion in the US is that Americans are entitled to, as a birthright, the highest standard of living on the planet. When our economic superiority goes, so will our military superiority. Americans are in for a rude awakening during this century.
There are several other very good books on globalization that I highly recommend:
The Chinese Century ........ Dr Oded Shenkar
The Rising Chinese Economy and its Impact on the global economy, the balance of power and your job
China, Inc .......... Ted Fishman
How the Rise of the Next Superpower Challenges America and the World
The World is Flat .......... Thomas Friedman
A Brief History of the 21st Century
Friedman identifies 10 “flatteners” and argues strongly that it is the cumulative effect of these factors which is causing such a rapid and dramatic shift in the global marketplace. By the time globalization has run its course, it will be recognized as one of the great transformational changes in world history, comparable to the Industrial Revolution and similar tectonic shifts.
The pity is that few Americans are aware of the magnitude of the challenge that we face and therefore do not demand that their elected leaders put global competitiveness at the top of our public policy priorities.
Phil,
Yes there will be ‘tribulations’ but there will be no ‘total’ collapse.
We have enough nukes and missiles to destroy any enemy militarily, everyone knows this. One can argue if there is a will to use them, but any attack that rivals or exceeds 9-11 will cause Americans to do whatever is necessary, and that includes the consideration of using nuclear weapons.
For the enemies we have within, we have the US Constitution. It is designed to make it exceedlingly difficult for any tyrant to rule the American people.
As for your references, all of them are based on offshoring of American technology and the equipping of competitors with the means to be economic powers. And you should know that the root cause of this transfer lies within the insane US tax code. And you should know further that the FairTax will reverse this shift and transfer of power.
Phil, I have a PhD in statistics so I am no stranger to high level analysis in whatever field. I also have experience in the highest levels of Washington DC as well as exposure to high ranking military discussions. So I think it is safe to say I have seen it all, just about. And that which I have not seen such as the recent banking and Wall St shenanigans, I am quick to grasp who the culprits are and what the elements of causation are.
I do not read books by people that write on political subject matters that are just a rehash of their experience in some think tank or some foundation or some policy experience in Wash DC.
Such writings impart no NEW information, or NEW intelligence to ME. They may impart to others, but not to me. I usually am at the ‘giving’ end of NEW information rather than the receiving.
Unless you think Prestowitz has some UNIQUE NEW information other than a rear view mirror of history and a speculative projection from it, then I won’t waste my time.
As for China, they have so many problems in their culture it is difficult to project anything about their future. Their markets will always in our lifetime and beyond be dependent on the USA and the West. They will grow their tech infrastructure, they will expand their military presence, they will try to inhabit other parts of the globe such as the Carribean. But they will never have the checks and balances that the Constitution provides Americans. Hence, they will never have the liberating innovative civilization underpinnings. They will always copy copy copy. And what they invent on their own, US scientists will quickly figure out, just as it was in the era of the USSR.
But if you insist that Prestowitz needs to be read, I will have a look. But make sure first that it will not waste my time.
You can decide for yourself if the book would be a waste of time. Here is what on respected reviewer said:
“Clyde Prestowitz gets it: America faces a changed world of great opportunity and great change. This book is a wake-up call for everyone who thinks we can cruise into the future without making major policy changes to sustain our competiveness.”
Craig Barrett, CEO, Intel
You did not address my central point, which is that China’s economy is expected to maintain its recent high rate of growth well into the foreseeable future. There are undoubtedly cultural problems, as well as infrastructure problems, but that has not stopped them from hyper-growth up to this point and isn’t likely to do so into the future. Perhaps the board members of Cysco, Intel and other hi-tech giants are totally wrong and China’s recent surge is merely temporary. However, I sure would not put my money on that.
You seem to believe that we don’t need to worry about economic competition and competing in the global marketplace because we have more nukes than anyone else. I don’t follow that line of reasoning. Are you saying that we can solve any economic challenges we may have by initiating a shooting war?
I completely agree with the Intel CEO and that is why we need to amend the Constitution and enact the FairTax for starters. But I do not need to read a book to find out that someone ‘gets it’.
As for the point about China, I had mentioned that China is dependent for the foreseeable future on the US and the West for its market stability. They are DEPENDENT. They do not have the cultural or governmental wherewithal to advance their economic progress without the dependency they have already been allowed to manifest.
Therefore, their economy is in recession despite reports to the contrary. I have first-hand information that factories and entire industries are collapsing in China. Expectations to the contrary are spotty at best, likely focused on a few companies in a few manufacturing sectors. Their numbers are every bit as suspect if not more than ours are.
The only thing going for China is Hong Kong. An international lawyer friend of mine who sets up trade contracts and oversees related transactions tells me that there is a still a huge disconnect between Hong Kong and the rest of China, even more so than existed between West and East Germany due to the cultural divide. Hong Kong operates under the British model of the rule of law. The rest of China with exceptions to certain traders in Shanghai are really in the dark. It will take generations at least coupled with fortuitous events to bring China into its own, not dependent on other markets and yet capable of driving technology AND MARKET ADVANCEMENT.
Even though technology is attractive, it takes more than technology to make an advanced society. For example, my former wife’s father died in a hospital in Lithuania. He was a cancer patient but he did not die of cancer. He died of a brain abcess. While he was alive her brother had assured her that the Onco ward where he was admitted had ‘all the latest technology’ and that the Oncologist was ‘very knowledgeable’. The cancer was removed successfully but his immune system was not attended to. He died as a result. The cancer surgeon had no liability and no concern, he had performed his function.
In general, the system around the world outside of the US and the West, is mainly a system of individuals who do not work in concert with one another. And there is no legal liability or rule of law that compels such individuals to work as a team.
An analogy is that China can build a basketball court, put up the latest and best equipment, the best arena and graphics, etc., choose the tallest and most talented players they can find, but if each player does not work with the others, they lose.
So there is in general an interaction effect that is lost on societies without a rule of law and a competitive underpinning. China has facades of both without a real foundation.
Another example deals with practicality and usefulness. In Japan, as it was recently aired on a PBS special, the Japanese health system has lots of razzle-dazzle techonology. A liberal acquaintance of mine pointed out to me about the one example of Japan’s Fast MRI scans and their comparatively low cost. Why didn’t the USA have these? was his question. Little did my liberal acquaintance know that many years back I was involved in the design of Fast MRI scanning at the University under a GE funded research grant. Our team actually designed, tested and tuned the statistical algorithm that used only one-tenth of the data normally generated by a full body scan in the tank for one hour. In other words we could produce a comparable MRI image in six minutes rather than sixty. And the ramification was that MRI would be dollarwise competitive with plain film XRAY. We had thought we had achieved a real tech breakthrough and had relegated XRAY to the past.
Well, that’s where American standards for practicality stepped in and squashed our giddiness. Every medical device or new medical treatment has to have a HCFA code. And HCFA required us to show that the new tech would be effective in practice.
So we designed a statistical study using radiologists and a group of patients with lower back pain. We split the patient groups into those receiving standard XRAY and those receiving new Fast MRI scans.
Long story short, the physicians reviewing the Fast MRI group wrote orders of magnitude more scripts than the control group. And they did so because they ‘saw’ more information and more problems, potential or otherwise. They had to write scripts for any problems seen because of their malpractice liability, their defensive practice of medicine.
And, the result of the increased number of scripts, meaning more surgeries, more pain medication, more precise injections, etc. did not increase the well-being of that patient group.
What had happened is that the physicians had attempted to make perfect what is not perfect and never will be perfect. We all have ‘problems’ internally that are not solvable because we see them better. In fact the old XRAY tech was ‘sufficient’ to catch problems that were degenerative and posed a progression that would become debilitating or life threatening.
But a PBS reporter can wander over to Japan and see better technology. But it doesn’t make a hill of beans to improving health.
That PBS reporter was clueless as to practicality and usefulness.
And I think some of what you read falls in the same category.
As far as your impression of me not caring to be competitive yada yada, of course I am concerned. that’s why I spend hours on these FairTax threads to try and keep the information clean.
As for my reference to our military superiority, I tied that attribute to the fact that no one will take away our aces. That we will always be a fortress of security, ergo our markets will be top tiered and preferred.
Security stands at the perimeter of free market stability and activity. To destroy our markets requires destroying our security. To destroy it from within requires overthrowing our Constitution in toto. It’s not to say there won’t be attempts or limited successes at pieces of it, but it will be very difficult in toto. It would be easier for the Island population of Pitcairn to launch a successful manned mission to Mars and back, than it would be to overthrow the US Constitution in toto.
Unless of course we do nothing. Leave it to the Ayn Rand readers to discuss that.
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