Income inequality takes off under Obama!!

There's a book called the "Fair Tax" and their web site (www.fairtax.org) addresses many of the particulars. There are even provisions to make the tax non-regressive for the poor. I'm not sure if this is the final answer, but it seems to be a good start.

Economists estimate there is (on average) a 23% fee (embedded income tax) in the price of all goods produced in the United States. Most countries with which we have free trade agreements only tax consumption. This means that our products are 23% less competitive overseas.

Foreign products sold in this country have an automatic 23% price advantage. That doesn't take into account lower wages, benefits, and ecological controls of our trading "partners". 20 years ago, Ross Perot said these free trade agreements would create..."A giant sucking sound of jobs leaving this country"...the man was right!




A gradual, programmatic reduction of the Federal Income Tax, coinciding with a gradual increase in Consumption tax would ultimately replace the 23% embedded income tax with a 23% point of sales Consumption tax.

US taxpayers shouldn't see any difference in the price of products. The people that will see a change are our foreign trading partners that will have to compete with lower priced US goods overseas while they help pay for the infrastructure they use in this country. All the US manufacturing jobs we lost over the past 20+ years will come flooding back to this country.

The other group that will see an impact are the folks working in our vast underground economy. Anyone not paying taxes now will pay the Consumption tax as it's rolled out. Tax cheats, criminals, and illegal aliens will all be paying their fair share.

If you listen to either party on TV or Radio, you get the idea there's only two solutions to our fiscal problems; raise taxes, or cut spending. There's a third choice they don't like to talk about...expanding the tax base. The only way to do that is by replacing the Federal Income Tax...and that idea is like Kryptonite to a politician! ...both parties.

Economists estimate that our tax receipts will double under a consumption tax. Progressives scare everyone by saying a Consumption tax is "regressive" and the rich won't pay their fair share without an Income Tax. Yes, it's regressive where it needs to be regressive (tax cheats and criminals), but it's not regressive on the poor.

Let's face it...there are really only three (3) things rich folks can do with money...

1. Save it...
Our money is a fiat currency that's continually being devalued to spur investment and jobs. If you save it, you will pay the "wealth" tax of monetary depreciation.

2. Invest it...
That's a good thing! It provides equity for production and research. It helps create jobs and innovation.

3. Spend it...
Spend it and you pay the consumption tax...BINGO!!

Anyone that says a Consumption tax exempts the Wealthy from taxation are simply trying to fool you.

Imagine a world with no more Income Tax returns to file. Every penny you earn, regular time or overtime, goes straight into your pocket. If you save for retirement, you pay no tax. If you live high on the hog, you pay as you go. Everyone is free to bite off as much as they want to chew.

You do lose something in the trade...the Government can no longer use the Income Tax code for law enforcement or social engineering. Let's face it...those are some important issues. However, I would contend that the tax code was never intended for those purposes. If the Government wants to do those things, they simply need to find another way about it.

All these things are covered in the Constitution. Other than the Air Force (which is covered under National Defense), the rest fall under the Commerce Clause of Article 1, Section 8...the same clause used to authorize Obamacare.

The Air Force is covered under National Defense. Although, at the time, the only explicit Constitutional reference to the "elements" of national defense were Army, Navy, and Militia...the constitution also refers to national defense in general, which includes all future elements (e.g. the Air Force).

All Federal rights are voluntary except for National Defense. Some argue that wars waged abroad are in our National Defense by keeping the unwashed hoards from our shores. That's certainly another point for discussion.

 

Yakpoo, I couldn't agree with you more.

 

Ah! The avoidance and dodging is strong in this one. Perhaps because Mr. RB is really talking out of his ass.

 

I wish everyone would read and consider/comment on my Post #81 (above). It's a serious solution for serious problems. It achieves all the goals Liberals "claim" to care about.

If that's not the solution, what it? ...I'm listening.