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I think it’s a great plan. Nowhere do you show how it will harm the middle class. I’m in the “middle class” and it would benefit me.

I’ve read the bill, I don’t see where it eliminates social security.

It states under SEC. 904. TRUST FUND REVENUE.

`(d) Old-Age, Survivors and Disability Insurance Rate- The old-age, survivors and disability insurance rate shall be determined by the Social Security Administration. The old-age, survivors and disability insurance rate shall be that sales tax rate which is necessary to raise the same amount of revenue that would have been raised by imposing a 12.4 percent tax on the Social Security wage base (including self-employment income) as determined in accordance with chapter 21 of the Internal Revenue Code most recently in effect prior to the enactment of this Act. The rate shall be determined using actuarially sound methodology and announced at least 6 months prior to the beginning of the Calendar year for which it applies.

I’m not an accountant, however I do have to say reading what you’ve written in this column versus what I read in the middle column encouraged me to read the bill for myself.

Good post.

Va. Laptop Sale Turns Into a Stampede
By KRISTEN GELINEAU, Associated Press Writer 18 minutes ago
RICHMOND, Va. - A rush to purchase $50 used laptops turned into a violent stampede Tuesday, with people getting thrown to the pavement, beaten with a folding chair and nearly driven over. One woman went so far as to wet herself rather than surrender her place in line.
This is total, total chaos,” said Latoya Jones, 19, who lost one of her flip-flops in the ordeal and later limped around on the sizzling blacktop with one foot bare.
An estimated 5,500 people turned out at the Richmond International Raceway in hopes of getting their hands on one of the 4-year-old Apple iBooks.
Officials opened the gates at 7 a.m., but some already had been waiting since 1:30 a.m. When the gates opened, it became a terrifying mob scene.
People threw themselves forward, screaming and pushing each other. A little girl’s stroller was crushed in the stampede. Witnesses said an elderly man was thrown to the pavement, and someone in a car tried to drive his way through the crowd.
Blandine Alexander, 33, said one woman standing in front of her was so desperate to retain her place in line that she urinated on herself.
“I’ve never been in something like that before, and I never again will,” said Alexander, who brought her 14-year-old twin boys to the complex at 4:30 a.m. to wait in line. “No matter what the kids want, I already told them I’m not doing that again.”
This is just one example of the intelligence we’re dealing with however.
A LITTLE GIRL’S STROLLER WAS CRUSHED IN THE STAMPEDE???
Thanks for your intelligent post though. What you are saying is important.

We won’t be fooled again.

It does also encourage me to learn more about the bill. Thanks

Lisa, do you really expect the authors of the bill to come right out and say “This Bill Will End Social Security” I mean really, consider for a moment hypothetically, that the authors really do want to use the bill to help end S.S., would they come out and say such a thing in a bill they hoped to pass? Of course not, it would spell the bills death knell since polls show the majority of Americans want SS saved, not ended.

Ok, now that we have established that IF the intent to use HR25 to end S.S. does exist, it would not be stated as such, let’s look a little deeper with our thinking caps on to see what the bill portends.

Currently, Corporate taxes go into the feds general revenues. Wealthy estate taxes go into the general revenues. Wealthy income taxes on all income, not just income spent this year, goes into the general revenues. Capital gains taxes go into the general revenues.

HR 25 does away with all of that revenue from the wealthy. It recoups a small portion of it from what the wealthy buy in a year, but, the vast majority of the rest of it, is lost to fund government programs like Soc. Sec. and Medicare/Medicaid.

Assuming that the bill is revenue neutral as its authors state, this means they will recover the same revenues under the sales tax plan as is now coming from the income tax system. So if the wealthy are getting all these huge reductions in taxes, those taxes will be coming from the non-wealthy. So, in addition to what the non-wealthy already contribute, they will have to cough up even more to compensate for the lost revenues in estate taxes, capital gains, corporate taxes etc.

Now, Soc. Sec., to be saved from its pending reduction of benefits in 2041, will need additional revenue, above and beyond what is now being collected. BUT WAIT!!! Conservatives are not going to raise taxes, they are all about lowering taxes. So what happens to Soc. Sec. if we can’t raise additional revenues and the non-wealthy are already picking up the wealthy’s share of taxes under HR 25, it sure like a prescription for ending Soc. Sec. instead of saving it.

Add to that, Bush’s intent to divert 2 plus trillion dollars of revenues which would have supported the Soc. Sec. system into privatized accounts, and now you have a double barrel shotgun aimed right Social Security’s head, and Republicans can’t wait to pull the triggers.

See, its there, you just have to consider what the text of the bill means in the real world.

Watch out! The sky is falling! Again…..

tomd-
The joke is on you. With Progressive taxes, the top rate you qualify for only taxes one bracket of your income. The rest progressively diminish as they go down. Because of this, you pay less as a total percentage than if you had a flat tax equal to your top rate (multiplication of six equal terms rather than the addition together of six numbers in descending order.)

Also consider this: anything that affects consumption also affects fiscal stability. Just take my word for it- a little use of your brain will save you some money.

No, David I don’t expect them to be honest. However even Laurence Vance who does not support Fair Tax for other reasons states it will not eliminate Social Security.

I’d post the link but have had very bad luck in getting links to post.

He does list some concerns that are valid, such as the ease the tax could be increased. Some of these concerns:

FairTax advocates claim that their plan would repeal of the 16th Amendment. However, all H.R. 25 does is repeal Subtitle A of the Internal Revenue Code of 1986 that relates to income taxes and self-employment taxes and Subtitle C that relates to payroll taxes and the withholding of income taxes. The only mention of the 16th Amendment in H.R. 25 is when it says: “Congress further finds that the 16th amendment to the United States Constitution should be repealed.” To repeal the 16th Amendment would require a constitutional amendment. Can Congress be relied on to pass a constitutional amendment that repeals the 16th amendment after a national sales tax has already been enacted? And even if Congress passed a constitutional amendment, it would still have to be approved by three-fourths of the states. Without the repeal of the 16th Amendment, what is to prevent an income tax from being imposed again after a national sales tax has been enacted?

The FairTax will make it easier for Congress to raise taxes. The initial rate of 23 percent is supposed to begin in 2007. For years after 2007, “the rate of tax is the combined Federal tax rate percentage.” This combined percentage is the total of three things: the general revenue rate (stated to be 14.91 percent); the old-age, survivors and disability insurance rate; and the hospital insurance rate. This is all but saying that the rate will be adjusted every year. And it will be very easy for Congress to do so. To raise several billion dollars of additional revenue, all that will be necessary is for Congress to raise the tax rate by one percentage point by small adjustments in one or more of the three items that make up the combined percentage rate. It will be sold to the American people as “a penny for progress,” or some other deceitful scheme.

Under the FairTax system, there are no longer any Social Security and Medicare taxes. However, this does not mean that Social Security and Medicare will be eliminated. The inclusion in the combined percentage of the old-age, survivors and disability insurance and the hospital insurance rates means that the Ponzi scheme known as Social Security will continue as is?only the way it is funded will change.

I didn’t say I supported it or didn’t support it, just that seeing the huge difference of opinion made me read more about it and it does not appear Social Security will be eliminated.

tomd, Stephen is right. Consider for a moment hypothetically speaking. Let’s assume this bill becomes law in 2006. Now consider the economy taking a downturn in 2012 like it did in 2000. What to do.

Well cut the sales tax rate of course, to stimulate consumer buying to buoy up the economy. But, federal outlays, already running 1/3 of a trillion deficit in these good times, would have to deepen until sales picked up and restored solid sales tax revenues, some two to four years later. Now, how does the government deal with the national debt which will be over 10 trillion in 2012, or the deficits. Why raise the sales tax, of course, which curtails spending, which leads us back toward recession again.

This roller coaster of a fiscal nightmare will be commented on by the Fed if the bill appears to have any legs. And the Fed’s words will not be kind.

What if in 2012, we are attacked by China, do we destroy our economy in order to raise the sales tax revenues to afford the massive military spending such a war would require? Because massive increases in sales taxes will tank the economy. You see, HR 25 is so unsound, in so very many ways, that even conservative economists will come out against it in substantial numbers if the bill looks like it has a chance in hell of becoming law.

Lisa, as I said, HR 25 will work toward ending SS in precisely the steps I outlined, which you chose not to respond to. So, I won’t bother to reiterate. HR 25 is part of a number of initiatives to end the program. Republicans know better than to just up and propose a bill to end Soc. Sec., they have to do it piece-meal and reach such a massive point of underfunding through a couple of new and different law initiatives, to force the American people to recognize that it is too late to save it.

Remember too, that this year’s 1/3 trillion dollar deficit also works to underfund Soc. Sec. There is a reason the party of smaller government and reduced gov’t. spending has in fact, increased the size of gov’t. and vastly increased the national debt. The more national debt, the less likely social programs will be to survive. It is part of a larger plan to incrementalize the end of social programs like S.S. and Medicare/Medicaid.

Why else would Republicans write into the Rx drug law, anti competitive anti free enterprise language to INCREASE the cost of the RX program to taxpayers. The evidence of what they are doing is overwhelming. Their plausible deniability is also overwhelming since they leave room with each move to say as you do, THIS particular measure DOES NOT end Soc. Sec.

Correct, any one policy of Republicans does not. But combine their policies, and it most certainly does end Soc. Sec., Medicare/Medicaid, and a host of other consumer rights once heralded as a check on the wealthy and corporate abuse and greed.

David, I did respond, and I stated it does not appear that Social Security is going to be eliminated.

I also gave you and those who are against HR25 some other items to consider.

As to what the future holds, I believe the more important issue is would a constitutional amendement be possible. If it is not then HR 25 is not worth considering support of since it would not do as promised to even worry about whether Conservatives will continue to have a hold on Congress to be able to eliminate Social Security.

I do not have a decision for or against this bill at this point. I am not sure it is the magic cure, yet I am not ready to declare it poison yet either.

HR 25 is part of a number of initiatives to end the program

Anybody around here seen that dead horse… I’d love to beat it some more.

David, really this is bordering on silly now. There is no secret plan to eliminate Social Security. HR25 is not part of some vast right wing conspiracy to end all programs and ways of life that you hold dear.

As I have said, it does not deal with, fix, or eiminate any other areas of government other than the outdated and overcomplex tax system (including the IRS). It IS revenue neutral. The only difference for Social Security would be that it would be funded (offically) out of the general fund instead of the government pretending that it is not now anyway.

Paul, it will not “destroy the middle class”. Your article reads exactly like someone who has not taken much if any time to really understand the idea at all.

If you want proof feel free to read any munber of other posts I have put up on the other articles in the blue and green columns about this topic.

Right now I’ll just say that I too am the “middle class” and I would look forward to the day when I can decide when and if I want to pay taxes.

BradM-
I don’t suppose you’re for cops deciding when they won’t enforce law and order. Neither are you likely for the military fighting only when it feels like it. This isn’t freedom, this is economic immaturity enshrined.

Adults around the world recognize the basic truth: People need and want governments and public services. The price of those benefits of citizenship, literally speaking, is your taxes.

Is this really the time to start messing with our tax system? No, it isn’t. Now is the time to admit that you’re paying taxes for a reason. Now’s the time to support the troops- by not endangering the money paying for the war they’re fighting.

One of the biggest problems with HR 25, which David almost mentioned above, is that it bases the federal revenue stream on spending habits, and bad ones at that. If people decide to save money by buying used goods, and spend that money on paying off their debts, then the federal revenue stream shrinks. So the federal government is led into the business of (a) encouraging consumer debt and (b) discouraging responsible spending…

…this is not what we want to be encouraging our citizens to be doing!

Its interesting to me that the current set of tax CUTS have led to increased tax revenues for the country. They have not produced the doom and gloom that some thought they would.

By many assessments, they have spurred the economy forward. At the very least, the economy has gotten stronger coincidentally after the tax cuts were enacted. Simply look at the time lines, and look at the growth in different sectors.

I haven’t read HR25 yet, so I’m not talking about it specifically. But I am pointing out that doom and gloomers seem to find doom and gloom in almost anything…sometimes afterwards they even remember having been so gloomy and a precious few will even admit to it, but more often they are simply off to yet another gloomy topic.

Paul Siegel wrote:
One thing I’d like to know: When a fatcat buys a service, such as political influence, will he pay a sales tax? Probably not. But even if he pays the sales tax, he is still in an excellent position to buy this service.
———-

My understanding is that gifts won’t be taxed, and so there is no need to record them, and besides, there will be nobody to keep the records - IRS will be abolished. So we - all of us - could buy all kind of influences with gifts. How convenient!(especially for fatcats, for whom this is a major expenditure).

I’d like to know if we are being censored? My post was not put in after a long wait…

jbod, you are falling for the greatest bait and switch of all. Don’t feel alone, cause you are not.

Let me give you an analogy. I have 5 credit cards with a $50,000 balance. But the maximum credit line on the combined cards is 150,000. I make $35,000 a year. My interest rate on the cards on average is 12.5%. OK. Stage is set. I take cash advances on those credit cards in year 2000, of $6000. I invest it in stocks. By 2001, I have lost 2%. In 2001 I combine that 5700 plus another 6000 cash advance on the credit cards and invest it in stocks. By 2002 I earn 1.5% on that sum. In 2003 I again take a cash advance of another $6000, combined with previous cash, I invest it all in stocks. By 2004 I have earned 4% on that 18000 borrowed. I am on a winning streak, so in 2004 I borrow another 6000 on the credit cards. Combine it and invest it. By 2005, a bumper year. I earn 7.5% on the $24000 borrowed.

Now it looks like I have done very well, doesn’t it. But, since 2000, I have been accruing an interest liability on that money of 12.5%. In 2005 while I am cash flush, I am also $24000 more in debt for the cash advances and have incurred an additional interest debt accrued, about 3500, less earnings on the stocks of 1200, or $2300. That’s $2300 from interest less earnings in addition to the 24000 I borrowed. I am now 76,300 in debt, where in 2000, before I started this gamble, I was only $50,000 in debt.

This is the exactly the same as what is happening with the tax cuts. Since 2000, we have gone further into debt by 2 trillion dollars, while folks such as yourself ignore that saying we are bringing in more revenue this year as a result of those tax cuts which put us 2 trillion in the hole, with a current 2005 deficit of 1/3 trillion dollars more. In 2000 our national debt was about 5.5 trillion. It is now almost 8 trillion.

C’mon, jbod, what good does it do to say that we cut taxes to increase revenues and ended up 2.5 trillion dollars more in debt? It is laughable to laud tax cuts that put us 2.5 trillion dollars in the hole after accounting for the revenue increases. Absurdly laughable - my sides hurt!!!!

Stop, please, stop! My wallet can’t take this comedy anymore…

David:

Your analogy, while amusing, isn’t nearly complete nor accurate. I spoke not of the deficit, which I agree is horrendous. I spoke only of the tax cuts, which have increased tax revenues.

You brought in a second variable (the deficit) which is an entirely different issue. You present it as if it is the same issue, but its not.

The argument has been that tax cuts will not bring in more revenue, yet we have more tax revenue than previously. The argument has been that tax cuts will not help the economy, yet the economy improved after the tax cuts occurred(coincidentally, of course).

The deficit is a problem. We need to control spending, and I hold our politicians, both Democrat and Republican, responsible. I hold Republicans more responsible for the areas they should be controlling, such as the new pork laden highway bill. I hold them all responsible for the increasing entitlements that are using up money.

But your analogy simply isn’t correct, and I suspect you know it.

“Destroy,” Paul? It will “destroy the middle class?” Get real. There are plenty of reasons to have reservations about this bill. You even made a few good points in your article. But you (and a lot of Democrats these days) continue to engage in over the top rhetoric that not only boarders on silliness, but lifts your argument out of the bounds of reality. Ever consider that it’s this kind of over the top nonsense that keeps the Democrats from winning elections?

As for “destroying social security,” This is the same kind of thing I’m talking about. The continued use of this “argument” amazes me.
Why do the Democrats expect us to believe that there’s some sort of vast conspiracy behind almost every issue? Could it be that the Democrats don’t have (or are unwilling to come up with and/or present) any ideas of their own? Instead of making up silly conspiracy theories about this bill being part of a plot to destroy social security, shouldn’t the Democrats be putting their time to better use by creating their own tax plan? After all, they’re just so sure they are going to regain Congress next year. Could it be that their poling tells them otherwise, so they are putting all their energy into being anti-Republican?

I don’t suppose you’re for cops deciding when they won’t enforce law and order. Neither are you likely for the military fighting only when it feels like it.

Cops and the Military are doing their job. That is what they are getting paid to do (and paid more under HR25 I might add). I am not working and getting paid only to support the government.

This isn’t freedom, this is economic immaturity enshrined.

No, it’s not. It is personal choice. If I don’t feel that I can afford the extra money that it takes to buy a new car because of the tax then I have the choice to avoid it by adjusting my lifestyle choices. That does not however mean that I will always decide to do that. I (like most people) will still make many purchases that will be taxed. If I don’t change my current lifefstyle then I will probably pay a similar amount of money into taxes as I always have. But my paychecks would be bigger so I’m not sure I would care. Immaturity is assuming that the government is better suited to make these decisions about my life than I am.

Adults around the world recognize the basic truth: People need and want governments and public services. The price of those benefits of citizenship, literally speaking, is your taxes.

That is true… Though other adults recognize that this concept has absolutly nothing to do with HR25. I guess I’ll say it again because you doom and gloomers all LOVE to skip over it with no real response. HR25 is a REVENUE NEUTRAL proposal. 20 years of research has designed it so that it will bring in the same amount of money that the government currently brings in, which as far as I’m concerned is more than plenty. There are many things that can and should be done in government to reduce spending, streamline programs, and expand other programs, but those are not part of HR25.

Is this really the time to start messing with our tax system? No, it isn’t. Now is the time to admit that you’re paying taxes for a reason. Now’s the time to support the troops- by not endangering the money paying for the war they’re fighting

Absolutly it is the time. I can’t think of a better time than the present to:

A) Fix something that is so broken and outdated that it is holding our economy and country down. Not to mention so easily bent to the whims of those in the government for their own gain.
B) To create a huge economy boom and job growth that has not been seen for many decades because the lack of taxes on corporations will lure overseas plants and headquarters to our soil. C) Create transparency in the government because there will be no way or reason to “write in” favors for big businesses in exchange for huge political donations.
D) Create a situation where American dollars that are currently being held offshore to avoid taxation and death taxes will be brought back to our soil and become part of our economy again.

The list of benefits goes on and on and I can think of no better time than the present to get them started.

As for supporting the troops I’m all for it… Luckily, and I’m not sure if I’ve mentioned this before, HR25 is revenue neutral so it will not effect how the troops are funded.

I’m about as Republican as it gets, and I think this bill sucks T.H.H.O.

Read the REAL bill, not the hyped faq.’s page.

Right now someone retired 65 or over doesn’t pay any SS taxes, under this bill they would pay untill they die.

Look at what they exclude as the poverty level, about $9400. That is the amount they claim it takes for a single person to live. Yea right, if they live under a bridge or in a homeless shelter.

Everyone would be taxed on all goods and services. Take your car into the garage for service, you pay taxes on the parts and the $40 hr. they charge for labor. neat huh?

Check under “barter system”. Recieve a service and you get to pay 30% tax on the fair market value of that service. Mow granny’s lawn for her and she now owes 30% on the normal $50 charge for that, even though you did it for free!

The tax doesn’t apply to exports, only imports.
Great deal for the euro’s and turd world countrys, big screwing for the average Joe. Not only did you lose your job overseas, you now get to pay an extra 30% on the crap they send back! Cool huh?

Anyone making under 100k, or not owning a business, would take it up the A** !

Sorry folks, this is one neo-con, evil Republican,that wouldn’t screw over my friends and neighbors like that!

Flat Tax !

Beagle, You and I have talked about this on other posts so I won’t bother with arguing with you. I would like to say thank you however for bringing actual concerns (regarding the poverty level dollar amount) and the tax on labor to the table instead of conspiracy theories and attempted guilt trips.

I dont agree with you of course (mainly because I believe that the benifits far outweigh the downsides) but I appreciate that you at least create a sense that you have taken the time to read and understand the plan.

BTW… Mowing grannys lawn for her would be a gift if you did it for free. Gifts are not taxed under HR25 :-)

joebagodonuts

Its interesting to me that the current set of tax CUTS have led to increased tax revenues for the country. They have not produced the doom and gloom that some thought they would.

What’s even more interesting is that back in ‘93, when we had a tax adjustment, EVERY Republican voted against it. They predicted doom and gloom, and what happened?
We had the strongest economy in decades!!! And talk about increased revenues, can you say surplus.

If your tax cuts lead to a mild recovery, and my tax adjustments lead to an even better recovery, shouldn’t we do the better of the two.

TheTraveler

Could it be that the Democrats don’t have (or are unwilling to come up with and/or present) any ideas of their own?

Could it be that they have? Could it also be that the Republican majority will not let the Democrats bring their legislation to the foreground.

I know of several Democratic plans… Most notably RAISE THE CAP!

All,

This talk of shifting the burden to those with less is making Adam Smith roll in his grave…

It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion

“consider for a moment hypothetically”

Which is exactly what all these posts concerning HR25 are, hypothetical.

BradM,

Ty for the kind words, but you need to read it again.

The term “gifts” and “services” get conflicting when services are also taxed.

If you’re down on your luck, and I give you my old lawnmower, that is a gift, no tax. If I mow your lawn, that is a service, you owe 30% on the fair market value of that.

No such thing as a used service.

The way the bill is worded it would be a nightmare for the elderly and the working poor.

I’ve owned several business’s and worked in upper management, I understand how the current system favors those with more money/education.

This bill may not trash the SS system, it might be tax neutral, but the tax would shift to the working poor and the middle class tax payers, and those that are retired on SS.

I used to give up my lunch-hour during taxtime to fill out forms for hourly folks to prevent them from paying H+R Block from charging them $40 for a damn EZ form that takes 5 min.’s, and likely screwed them out of legal deductions they were entitled to.

The rest of the year I taught a math/econ class during lunch, to try to help them to better manage money and get ahead. The company provided a room for that, and donated materials for it.(They likely took a deduction for that).

I’m not a Saint, and I’m as capitalist as it gets, but I try to help those that work to get ahead.
I think this plan, in its current form, will screw those people over, I may be wrong.

I prefer some sort of flat-tax system over this one.
Thats just my opinion, and I enjoy reading the opinions of everyone else.

I spoke only of the tax cuts, which have increased tax revenues.

You brought in a second variable (the deficit) which is an entirely different issue. You present it as if it is the same issue, but its not.

When considering the economic status of the country, can you fairly take tax revenues out of context from the deficit?

I said:
Could it be that the Democrats don’t have (or are unwilling to come up with and/or present) any ideas of their own?

Adam replied:
Could it be that they have? Could it also be that the Republican majority will not let the Democrats bring their legislation to the foreground. I know of several Democratic plans… Most notably RAISE THE CAP!

In that case, Adam, the correct political strategy for the Democrats would be to talk up their own plans. Instead, people like Paul are spending more time making up conspiracy theories about a Republican plan. Considering HR25 is getting more discussion on WatchBlog that it is in Congress, this seams a waste of time to me.

Perhaps for the next article, someone from the blue side should write about the tax plans the Democrats have came up with recently (although I doubt they have anything quite as comprehensive as HR25). Who knows, touting their ideas might even help them win elections! But of course, that kind of article would take up valuable Republican/Bush bashing space!

That last reply was to Patrick Howse’s post. He was quoting someone and that name was on the bottom of his post. Sorry for any confusion…

Taylor:

Both taxes and the deficit are important issues. But they dont automatically enjoin, as David suggested. It just doesnt work that way.

As I said, the deficit needs to be attended to. The wild spending habits of Congress need to be curtailed. No way should Alaska get so much money from the highway bill just because Ted Stevens has so much power….aint good for the country. But its how politics works right now, unless we change it.

Beagle:

I’m all for a flat tax, though i’d muddy the waters a bit by having it run on a bell curve, rather than be totally flat. Tax the wealthiest 20% at a slightly higher rate, and the poorest 20% at a slightly lower rate. Get rid of all the trickery etc, which would get rid of a lot of expense at the IRS…. whattaya think?

Traveler,

I agree with your post that Dem.’s need to counter with some sort of plan for tax reform, currently they have nothing.

HR25 and the flat tax (Forbes) are both Republican reform plans.

The current tax plan sucks, waiting to see how things go in 2006,2008,2012, wont help the Dem. party if they cant say what the’re plan is for tax reform.

The term “gifts” and “services” get conflicting when services are also taxed.

If you’re down on your luck, and I give you my old lawnmower, that is a gift, no tax. If I mow your lawn, that is a service, you owe 30% on the fair market value of that.

No such thing as a used service.

I don’t think your interpretation is correct…

I believe you are refering to section 103(f) “barter transactions” which states “If gross payment for taxable property or services is made in other than money, then the person responsible for collecting and remitting the tax shall remit the tax to the sales tax administering authority in money as if gross payment had been made in money at the tax inclusive fair market value of the taxable property or services purchased.

The key word in this is “Taxable”.

Under HR25 you need to be a registered seller (pursuant to section 502) engaged in a trade or business to collect sales tax. Therefore if you (yourself) decided to mow someones lawn for them as a favor, that would not constitute a “taxable” property or service. Even if you accepted a case of beer in trade :-)

I believe you would be correct if you’re registered business mowed lawns for a living and you normally charged taxes on the labor involved. Then you went to granny and (using company property) mowed her lawn in exchange for something other than money. Technically at that point the “Barter Transaction rule” would come into effect and it would be up to you as a business if you want to decide to run the risk of getting caught and facing the penalties listed under Section 505(b).

BTW Beagle, I have said this in other posts as well that I like the Flat Tax as well. I just happen to like the upsides that I see in this plan better myself. One way or another, I believe that something needs to be done with the tax system, even if it is not HR25.

I agree with your post that Dem.’s need to counter with some sort of plan for tax reform, currently they have nothing.

This and just about every other isue…

Joebag,

I agree, a flat tax should exclude those making under 18-25K.

Married,single, who cares, taxes shouldn’t be judgemental based on lifestyle.

If someone has no kids or 20, I don’t care.
Have all the kids you can afford, pull out, or pay to raise them.

Problem solved, I didn’t screw someone’s wife to produce them. I dont think I should be taxed for them.

I dont want to pay to abort them either!
Puting shit like that in a tax system is crazy.

I dont believe in abortion, but if I didn’t hose your wife, I’m not wanting to pay for it.

Reform taxes to exclude marriage or kids, it will make it more fair, and better for everyone.

“This means the tax system is no longer graduated. If it’s not graduated it is not fair.”

HAHAHAHAHAHAHAHAHAHAHA! A-HAHAHAHAHAHAHAHAHA! Wow! I can’t believe I just read that and I can’t believe anyone actually believes that! Wow! HAHAHAHAHAHAHAHA!

Thanks. I needed a good laugh today.

Why not simply try this out in three different states for a period of, say, five years? See what the positives and negatives are after a practical experiment?

jbod, your comment reflects complete ignorance of basic economics. The ONLY reason for taxes in the first place is to pay for what Government spends.

How in the hell can you hope to make a logical argument that deficits have nothing to do with taxes and their revenues. Reagan did the same thing. He cut taxes, vastly increased the deficits and debt, and we spent the next 14 to 16 years getting back to a surplus for just one year, before spiralling the national debt again ever upward under Bush Jr.

Taxes exist to pay for what government spends. There is no way to spin this simple fact, jbod. When you cut taxes and deficits are created and national debt grows and grows and grows, it is pure bullshit to say government or the president is being responsible because the tax cuts increased revenues.

If tax cuts increased revenues to the point of creating surpluses which either pay down the national debt or result in permanent tax cuts, then saying tax cuts increased revenues has some positive meaning. But that is not at all, in any way, the case in reality today.

There are 3 ways to stop spiralling debt. Increase revenues, decrease spending in some combination to the point that surpluses are generated, or bankrupt and tell creditors they can’t get blood from a turnip. Bush cut the revenues that are needed to pay for government spending which is spiralling our debt.

Where in the hell is Bush’s veto pen, if you believe tax cuts are good and spending is bad. These tax cuts without equal and greater spending cuts is the greatest fiscal irresponsibility possible, rivaled only by countries like Brazil and Venezuela in the recent past. There is a limit to how deep in debt a nation can go. And Bush is doing everything right to take us to the brink to find out where that limit is.

To talk of tax cuts without the context of spending, deficits and debts, is to demonstrate a complete ignorance or ignoring of the fundamental reason and justification for taxes in the first place, to pay for government spending. Bush and Republicans are NOT paying for their spending. This is irrefutable. They have put American tax payers 2.5 trillion dollars more in debt. Present and future taxpayers will have to shoulder that debt.

Bush is cutting taxes today with the result that taxpayers tomorrow will have to pay 3 trillion more in taxes than taxpayers pay under his administration. This is appeasement to today’s parents in exchange for punishing taxes of their children tomorrow. YOU may think that a president that makes my and your children’s tax future worse than ours is today, I DON’T !!! I call that irresponsible in the extreme and IMO, evertime the president says we should not pass our problems on to the future, he is lying through his teeth. His actions contradict his words BIG TIME!!!

It should be criminal for him to lose his veto pen for 5 years while cutting taxes during a time of huge deficits and spiralling national debt for our children to be punished by. In my book, he is criminal, but, then my laws of fiscal responsibility are not Congress’ or Bush’s laws, so folks like you keep giving them a get out of Jail Free card.

BTW, jbod, that 2.5 trillion Bush and Republicans have increased the national debt, breaks out to $16,600.66 for every wage earner in additional taxes to be paid, assuming a work force of 150 million wage earners. That is what your tax cuts have got us. Another day older and deeper in debt. The tax cuts raised revenues. Yep, and added over $16,000 to each and everyone one of our taxes owed.

Reform taxes to exclude marriage or kids, it will make it more fair, and better for everyone.

Nah, tax more for each child. $1000 for 1st, $5000 for 2nd, $10k for 3rd, etc. Put your money where your reproductive organs are.

Have all the kids you can afford, pull out, or pay to raise them.

Hear hear!

I actually like a flat tax for the short term, it would work great for me personally, until of course, the ghetto creeps up on my backdoor, and I get to wade through a pile of panhandlers outside the train station, instead of the one or two there today.

Both taxes and the deficit are important issues. But they dont automatically enjoin, as David suggested. It just doesnt work that way.

Sorry, I gotta agree with David on this one. How you think the money we spend and the money we take in aren’t part of the same equation, I don’t get. If any individual doubles thier salary, but quadruples their spendings, what is the net effect?

I don’t know, but it seems that, given the passage of the bankruptcy revisions, it is not inconceivable that there is a “conspiracy” in the works here. I have yet to read the bill, but in conjunction with the bankruptcy bill, there appears to be a concerted effort with HR25 to increase levels of consumer spending by providing larger paychecks. In turn, because the government has a greater vested interest in what we buy (as opposed to how we earn our money), the government will try to encourage increased levels of consumption, thereby creating greater levels of debt. Because this will most likely force more bankruptcies, which will be forced into Chapter 13 reorganization, not only will institutional lenders be getting more money back, they can then charge higher interest rates due to the lower average credit score. All in all, it seems that the lending industry is going to make out like a bandit, with the help of the government, and at the expense of the consumer, which is ussually the middle class for lending purposes.

WHAT????

There’s a “vast right-wing conspiracy” to do away with Social Security?

Oh…come…on!

Puh-leese!

(For those on this blog that take everything seriously, the following is nothing but sarcasm)

Yeah…and I joined the “vast right-wing conspiracy” to keep Sasquatch a secret because of “national security reasons”.

And I joined the “vast right-wing conspiracy” to get rid of diaper rash.

And I joined the “vast right-wing conspiracy” to (insert really dumb thing here).

Look…

the only “vast right-wing conspiracy” I know of is the “vast right-wing conspiracy” to keep control of the White House and Congress.

And with wild, unsubstantiated claims like “the right wing wants to get rid of Social Security”…you’re making that that “conspiracy” a more realistic goal every day.

wild, unsubstantiated claims like “the right wing wants to get rid of Social Security”…

If it’s not on the minds of some, why was there a video on CNN of people shouting “hey hey, ho ho, social security’s got to go!” ?

David:

I’ve come to expect well reasoned arguments from you, rather than attacks on my intelligence or knowledge. After all, Watchblog’s motto is critique the message, not the messenger. I guess its okay for some people to not adhere to that.

I understand economics enough to know that the tax cuts increased tax revenues. Sounds like it should work the other way, but it doesnt. I also know enough to recognize that revenue coming in and expenditures going out are two different issues. As I said, I approve of how Bush has dealt with the former, and I disapprove of how he has dealt with the latter. I don’t blame him or the Republicans solely, since Demos in Congress are in on the spending too, but since Repubs have the control, they should assert it, regardless of whether they get howls of protest or not.

David, in your second post, you are equally incorrect as in your first. Your premise is that the tax cuts created the deficit, and you are just plain wrong on this. If the tax cuts have increased tax revenues, as I have stated, then they by themselves are NOT the issue. If you want to argue whether tax cuts have raised revenues, take it up with the CBO.

Associated Press…”The CBO predicted a $331 billion deficit for the budget year ending Sept. 30 and a $314 billion deficit for next year.

The short-term improvement was attributed to an $84 billion surge in estimated tax receipts, including a 42 percent increase in revenues from corporate profits

Taylor,

CNN is losing market share because they are biased, dumbasses, it doesn’t matter what anyother channel does.

“If it’s not on the minds of some, why was there a video on CNN of people shouting “hey hey, ho ho, social security’s got to go!” ?

Posted by Taylor at August 17, 2005 04:08 PM “

They can post; “Hey Hey, ho ho, being an asshole will likely show.” It makes for a slogan, and is just as meaningfull as the CNN bullshit, and it rymes.

joebagodonuts

I understand economics enough to know that the tax cuts increased tax revenues.

Not all the time, as I mentioned earlier, the ‘93 tax adjustment in which EVERY Republican voted against, filled government coffers into the black, and took a Republican Majority to make it red again.

Also, there have been many rounds of tax cuts (under Bush). After this last round, there was a modest up-tick in the economy. But by your logic, the two LARGER tax cuts previous should have INCREASE revenue, and they most certainly did not. By contrast the Clinton tax adjustment should have decreased revenue, but instead the economy (and revenue) roared.

CNN is losing market share because they are biased, dumbasses, it doesn’t matter what anyother channel does.

“If it’s not on the minds of some, why was there a video on CNN of people shouting “hey hey, ho ho, social security’s got to go!” ?

Posted by Taylor at August 17, 2005 04:08 PM “

They can post; “Hey Hey, ho ho, being an asshole will likely show.” It makes for a slogan, and is just as meaningfull as the CNN bullshit, and it rymes.

I see. So that didn’t happen then.

jbod, you are not getting away with this: “I guess its okay for some people to not adhere to that.”

Please quote where I violated the policy. Otherwise, your words are sour grapes.

Check it out, jbod, the economy grew revenues, yes, to some extent. But the tax amnesty program soon to expire in which tax delinquents are offered a settlement of paying a fraction of what they owe and avoid prison, is also playing into these increased revenues. These are direct links to revenues.

The Tax Cuts have no direct link to increased revenues. A cut in pay, is a cut in pay, is a cut in pay. Lowering tax rates lowers tax rates lowers tax rates. If economic growth occurs, revenues will increase. But, even the conservative think tanks say there is no way the economy could ever grow fast enough to buy down the deficit additions to the debt we are adding.

You don’t have to take my word for it, see what some of your fiscal conservative think tanks are saying. Tax cuts spurred economic growth which increased revenues, but, the increases in revenues are falling far, far, way far short of keeping pace with spending and debt, as measured by (drumroll please…) DEFICITS. 1/3 trillion just this year.

This is not rocket science, jbod. Just arithmetic. Doesn’t even require algebra. Just addition and subtraction, that is how we arrive at deficits or suprluses. Revenue minus spending equals suprlus or deficit. And every argument you have made continues to try to separate revenue from the very definition and purpose of that revenue, to pay for the spending. It is an impossible position to defend, jbod.

Jim T said: “the only “vast right-wing conspiracy” I know of is the “vast right-wing conspiracy” to keep control of the White House and Congress.”

Yep, that is why they are selling out our future to appease voters today. Tax cuts today that will increase every wage earners tax debt tomorrow by $16,000, and this just up to this year. Who knows how much your and my children will have cough up for our tax cuts and outrageous pork spending tomorrow for a vote today, all to keep themselves in office. American voters are so easily bribed by politicians, but, then, what would you expect from politicians who take bribes via campaign donations for policy favoritism in office.

Right on, Jim T.

Of course not, nothing coming from CNN is real, it is all fabricated news.

Why were they chanting “Hey, Hey, Ho, Ho…”?

For the same reason that just before the last election, there were actually people who believed that if Bush were re-elected there would be a reinstatement of the draft.

The reason is…

There’s no accounting for the gullability of the American Public.

Say something enough times…it suddenly becomes true.

Of course not, nothing coming from CNN is real, it is all fabricated news.

Ohhh… of course! The fabriCated News Network. Why didn’t I “C” that before?

Say something enough times…it suddenly becomes true.

Shrub is the anti-Christ.
Shrub is the anti-Christ.
Shrub is the anti-Christ.

Did it work?

It is obvious to me that not one of you live in Texas, as you would have to be stupid, blind and dead to not understand that there is A Right Wing
Conspiracy alive and well.

David:

Im surprised to have to remind you of this, but please read what I write. You said that “Tax cuts spurred economic growth which increased revenues, but, the increases in revenues are falling far, far, way far short of keeping pace with spending and debt”, which is exactly what I have been saying.

Reread what I wrote. I said clearly that the excessive spending is killing us, but also that that is a different issue from tax revenues, which you agree are up.

How do I simplify this? Lets see…..On side A we have money coming in. On side B, money going out. If Side A increases, it doesnt necessarily affect Side B. It DOES affect the sum of A+B, but thats as I’ve said…..a different issue.

My point again…..Tax cuts have increased tax revenues. Now we need our politicians to curb their exorbitant spending. If both things happen together, voila…..the deficit and debt get more under control.

Lastly David, I usually find your comments constructive, rather than inflammatory. It was your questioning my “ignorance” that disturbed me. I guess you did suggest that my comments suggested the aforementioned ignorance, but nonetheless, it certainly seemed like you were taking a shot at me.

jbod, your original statement that I responded to was:

Its interesting to me that the current set of tax CUTS have led to increased tax revenues for the country. They have not produced the doom and gloom that some thought they would.

The word ‘They’ in your last sentence refers to the tax cuts. And I as I have pointed out, they have led, are leading, and will continue to move this nation further and further into debt, mandating an enormously larger tax burden on Americans than existed before, or exists today. $16,000 per wage earner and counting.

Tax cuts during a time of rising deficits and national debt are most certainly a major contributing factor to those deficits and debt, per the arithmetic formula, revenues less spending equals surplus or defiict.

As you can see, I for one am not off to another doom and gloom topic in response. Now perhaps you don’t think Bush and the Republican controlled Congress putting an ADDITIONAL $16,000 tax debt on my daughter who will enter the work force in a few years is doom and gloom, but as a voting father who demands fiscal responsibility for my tax dollars, it is a doom and gloom scenario. I am not raising my daughter to become a slave of state.

And this conversation is taking place in the context of HR25 which eliminates huge sums of taxes for the wealthy and eliminates them entirely for corporations, and shifts the burden of their current tax revenues on to the general consumer. The authors say it is tax neutral. I say it is tax shifting from the wealthy to the general population at large, the vast majority of whom are not wealthy and hard working folks.

Not only has Bush and Republicans increased their future tax obligation with their tax cuts and profligate spending, but now in HR 25, they propose regular working folks pick up the tab for for eliminating estate taxes for the wealthy, and eliminating capital gains taxes for the wealthy, and eliminating income taxes for the wealthy.

I was careful with my wording. You are a bright person. We are all ignorant of many things. To me it is not an insult to be told I am ignorant of a topic. No offense intended.

I take issue with your statement, Paul, that the government helps businesses. Maybe business in the top tier get help from the government, but not small businesses, which make of the vast majority of businesses out there. Small businesses suffer mightly and pay massive amounts of tax just to subsidize Bush’s tax cuts for his corporate friends.Trust me,my husband does it every year. Don’t generalize and oversimplify just to make your point. That’s dangerous.

Anyway, I lived in England for a bit and my husband is from New Zealand. Both are countries with what the English call a value-added tax, which is basically what this plan is. In England, I paid 10% national healthcare tax, 18.9% VAT on everything I bought and 20% on income tax. Of course, the free healthcare and nearly free medicines rocked and the government services available were sooooo mcuch better than the illogical, bureaucratic mess we have here. What the pundits who are supporting this “fair tax”, in the words of blow hard Neal Bortz, forget is that nations with VAT (Canada is another example) have had to tax income in addition to the VATs in order to survive. VAT just doesn’t cover it. Why are we not studying other national experience with this and why is this not part of the debate.

Also, to say that it shifts the burden to the middle class is naive and frankly dangerous. The middle class/upper middle class already bears most of the tax burden in this country anyway thanks to those lovely IRS caps. Taxing people with incomes of $50,000-$150,000 an average of nearly 30% of their income is insane

David and JoeBagofDonuts
you’re both sort of missing the point
Joe
Increased Revenue — AS COMPARED TO WHAT???
The section you quoted merely states that there was an 83 Billion uptick — FROM WHAT???
from what was ESTIMATED BEFORE!!
The “revenue increase” is really nothing more than another way of saying “LESS REVENUE REDUCTION” than what the revenue stream would have been WITHOUT Tax cuts.
To believe your position Joe, you also would need (which you don’t) to show a connection between the tax cuts and an increase in the economy.
Sorry, but NO ONE believes that (except the blind “true believers”)

David — Your responses are not getting thru to Joe because he still believes the “revenue increase” but he doesn’t tell you what the increase is in relation to!!
THAT IS REALLY IMPORTANT!!
Is it an increase over what the revenues WOULD HAVE BEEN WITHOUT THE TAX CUTS????
NO
DOES ANYONE HAVE THE NUMBERS THAT ARE BEING COMPARED TO COME UP WITH WHAT CONSTITUTES “INCREASE”??
To the best of my knowledge, this “increase” is merely a correction to an estimate of revenues for THIS YEAR. — The original estimate was based on REDUCED REVENUES DUE TO TAX CUTS, therefore this “INCREASE” is merely a reduction in how much the revenue stream is REDUCED BY THE TAX CUTS.
Now regardless of the previous BS arguements about increase or not MAIN POINT
WE ARE STILL RAPIDLY INCREASING THE DEBT EACH DAY!!!!!!!!!!!!!
HOW CAN YOU SUPPORT REVENUE REDUCTION (TAX CUTS) AND MAINTAIN CURRENT LEVELS OF SPENDING.
I LOVE HOW YOU PUT IN THE LITTLE “WELL, DEMS ARE RESPONSIBLE TOO” B.S. LINE — REPUBS ARE GIDDY WITH HOW THEY CAN JAM THESE IRRESPONSIBLE SPENDING BILLS DOWN THE THROATS OF THE REST OF THE COUNTRY AND JUST SHOUT (OR VOTE) DOWN ANY OPPOSITION!!
AND THE PRES DOES NOTHING WITH THE VETO PEN!!!

There is one good thing about getting rid of the “death tax” — your decendants are going to need the money to pay the taxes you dodged — because you are not mature, nor responsible enough to PAY YOUR OWN WAY!!!!

David — Your responses are not getting thru to Joe because he still believes the “revenue increase” but he doesn’t tell you what the increase is in relation to!! THAT IS REALLY IMPORTANT!!

I agree. Taken out of the larger context, revenue increase is meaningless.

The “revenue increase” is really nothing more than another way of saying “LESS REVENUE REDUCTION” than what the revenue stream would have been WITHOUT Tax cuts.

Thanks Russ. I was going to make that point also.

David:

Thanks for the response. I still think we disagree about where the deficit (the $16,000 per person number you refer to) comes from. It seems to me you are saying it comes as a direct result of tax cuts. I see it as a function of spending. If tax cuts have increased overall tax revenues, then they would be actually lowering the deficit.

Are you arguing that tax cuts have not increased revenues, or are you arguing that tax cuts have increased revenues, but only by pushing costs down the road to our children (sort of like living off a credit card and thinking you are flush simply because the bill hasn’t yet come due)? My understanding of your comments leads me to believe you are presenting the second scenario—is that right?

Russ:

I’d agree with you that its too simplistic to take a cause/effect scenario with regard to taxes and the economy. For example, immediately after the tax cuts, the economy went downward, and many people blamed the cuts. Problem was that the cuts had yet to even be enacted, so could not have been the cause of the downturn.

Even now, we have seen the economy move upward after the tax cuts, but it is too simplistic to say that tax cuts were the full cause. I believe them to be part of the cause, but the economy is too large and complex for one variable to sway it completely.

Another way to look at this is to note how the economy dropped significantly during Bush’s first term. However, we also know it was dropping as of Q4 of 2000 prior to his tenure, and we also know that 9-11 and the accounting scandals affected the economy negatively. So it would be simplistic to place all the blame on Bush for the economy dropping. It WOULD be okay to believe that his policies did little
to dampen the blows from these events, or to believe that his policies did much to dampen the blows. But to those who consider Bush to have been the sole problem, I’d say that’s just too simplistic.

Regarding your comment that my holding Democrats responsible alongside Republicans is BS, I’d disagree. We’ve seen that the minority party retains a certain degree of power, and as such deserves a certain degree of credit and responsibility for what happens with our country. The Repubs deserve more credit or more blame, due to the amount of control they have.

If you are unwilling to apportion credit and responsibility to the minority party, then by rights the Republican control of Congress throughout the mid and late 90’s should mean Repubs were responsible for that good economy. I doubt many Democrats would concede that, though, nor should they do so without giving Clinton due credit as well.

Joe
You still refuse to address the main point
Increase in relation to WHAT???
SO WHAT IF THE REVENUE INCREASE IS INCREASED FROM A TOTAL DROP!!
IF THE REVENUE NOW IS STILL LESS THAN IT WOULD BE WITHOUT TAX CUTS, WHAT’S THE POINT????

You are arguing about an increase from a previously depressed revenue stream
The stream is STILL DEPRESSED, JUST NOT AS DEEPLY AS BEFORE!!! SO WHAT?????

Let’s see if I have your other arguement right
It is “too complex” to “Blame” Bush (or his policies) for the downturn in the economy, but somehow when the economy shows an upturn it is somehow logical to attribute it to the tax cuts!
HUH?????
That is the ONLY WAY you can attribute a change in revenue (Upwards, BUT STILL BELOW PREVIOUS LEVELS)to the tax cuts.

Now
regarding the ENTIRE DEBT problem
Even without increased spending, the tax cuts were (and are) irresponsible because we still had the debt to get rid of.
currently service on the debt is a SIGNIFICANT budget item
we are currently not even touching the principal
however the interest on the debt is relatively low due to interest rates being at historically LOW levels
What happens when interest rates go up????
Service on the debt goes up
Deficits go up
Debt goes further up.
History
the rational (originally) for the tax cuts was that WE HAD A SURPLUS, and gosh dang it, it is YOUR money and ya’ll should be able to spend it (however we are going to let the rich guys spend your money — cause they’re smarter)
Of course there is this huge debt you still owe, but gosh, we all are living on credit, so why not the Gov’t????
of course, just like Iraq, the rational changed with the wind
Now it was to “spurr the economy” — hmmmm, don’t recall that one when they were passing this BS.

So, we then go to war, with a HUGE COST
we have problem with the 9-11 after effects (HUGE SPENDING FOR HOMELAND SECURITY)etc.
Are you saying that we shouldn’t be spending the money on the military for the war??
YOU DON’T SUPPORT OUR TROOPS??????
YOU ARE NOT PATRIOTIC??????????
WHAT IS THE MATTER WITH YOU?????
(PREVIOUS THREE LINES ARE PRESENTED WITH SARCASM — SEEING AS HOW THIS IS WHAT THE RIGHT USES TO SUPPORT THEIR POSITIONS)
YOU DO REALIZE THAT THE DEFENSE SPENDING IS THE MAJOR PART OF THE BUDGET??? — SO JUST WHERE WOULD YOU CUT THE SPENDING LEADING TO THE DEFICIT???

Now, in light of the increased spending for the war, it is totally responsible to voluntarily reduce your income (immediate effect of tax cuts, otherwise why did they (congress and the budget office) account for BILLIONS IN LOST REVENUE IN THE BUDGET due to the tax cuts?????)
I find it interesting that you don’t accept that the cuts led to increased deficits, when the original rational had the (original) SURPLUS REDUCED BY THE AMOUNT OF THE TAX CUTS!!!!
The Budget Office PREDICTED Deficits AS A RESULT of the tax cuts
The TAX CUTS were called an EXPENSE.
what more do you need????
silly question, I’m sorry, you are in total denial about this because you read somewhere that there was a “revenue increase” — and you don’t care about the entire picture
You just keep repeating “revenue increase”
just repeat three times while tapping your heels.
Nope, still not in Kansas anymore Toto.

Russ:

Let’s see if I have your other arguement right: It is “too complex” to “Blame” Bush (or his policies) for the downturn in the economy, but somehow when the economy shows an upturn it is somehow logical to attribute it to the tax cuts!

What I wrote was this: “Even now, we have seen the economy move upward after the tax cuts, but it is too simplistic to say that tax cuts were the full cause. I believe them to be part of the cause, but the economy is too large and complex for one variable to sway it completely.”

Now how exactly did you get YOUR version from what I posted? Perhaps a remedial read will help you understand what i actually wrote. You are free to be as sarcastic as you wish, but I’d hope that you’d at least try for a semblance of accuracy.

Are you suggesting that without the tax cuts, the deficit would return to a surplus? And if not, then where would YOU cut from the budget, since you accuse me of wanting to cut necessary things from the budget (without having any idea of what I would cut, of course).

The idea of tax cuts WAS and STILL IS to improve the economy. By improving the economy, there is more money to be taxed, even though at a lower rate, therefore the govt brings in more actual money. This rationale has not changed one iota at all, except perhaps in your mind.

We KNOW that tax revenues increased after the tax cuts. We KNOW that the economy moved upwards after the tax cuts. What we cannot know is to what degree the tax cuts caused this ocurrence. But your premise seems to be that revenues would have increased whether anything was done to taxes—-and that could be correct. So too could be the argument that tax cuts increased the revenues. As I’ve stated, the economy reacts to many stimuli, not just one.

Should you decide to yell sarcastically some more, I’ll be happy to read your words. And I will correct any future misstatements just as I have done in this post.

WELL I THINK THAT THEY SHOULD DO AWAY WITH THE IRS.JUST THINK OF THE MONEY THAT IT WILL SAVE.YOU ARE HAVING TO PAY ALL THOSE PEOPLE WHO DO THE TAXES.AND I THINK IT WILL BENEFIT ALL PEOPLE IN THE LONG RUN.WE PAY SALES TAXES,SCHOOLTAXES,AND ETC.THAT IS ENOUGH.

After all the hype and comments on here about the Fairtax, I can still see no reason to not support it. Not having to fill out a tax form would be wonderful. The way the plan is presented it beats our current system hands down.

it is too simplistic to say that tax cuts were the full cause. I believe them to be part of the cause

I actually agree with that, jbod. Democrats, Greenspan and most leading economists agree that the middle class tax cuts: the child tax credit, ending the marriage penalty, and expanding the 10% bracket deserve all the credit for whatever stimulation of the economy there was.

But those tax cuts constituted only 25% of the total tax cut package. The other 75% favored the wealthy and did nothing to stimulate the economy and is largely responsible for the record-setting deficits.

Al Gore’s tax plan allocated quite a bit more to the middle class tax cuts, so it’s easy to make the argument that Bush’s version of the tax cuts lengthened and deepened the recession. Russ’s point that your statement lacks context is correct.

A.P.

After rereading the posts in this thread, I believe I’ve been clear about stating that looking at tax cuts or tax revenues in a vacuum means they are without context. Seems to me that is what you are saying as well.

My point all along has been that I don’t beleive the tax cuts to be the devious ill conceived plan that some think they are. I showed the positive aspects to them—there certainly are negative aspects as well.

Were I to have come up with a plan, I’d not have given quite as much to the wealthy, though I don’t view it from the standpoint that many on the left do, which is the “they can afford it” viewpoint. I prefer a more equal taxation that a flat tax would bring. You pay more real dollars if you make more money, but you dont pay a higher percentage (i did say earlier that I’d bellcurve a flat tax a little though).

I think you can probably make just about ANY argument about the good or bad of any tax plan. Even years after, the impact can be debated, since there are so many variables at play. Lets not forget that Dems originally were against any cuts, then modified their position to favor cuts, but different cuts than Bush proposed. In this light,I stick with my opinion that the tax cuts have been helpful. Might a different version of the cuts have been MORE helpful—-perhaps.

joebagodonuts

I prefer a more equal taxation that a flat tax would bring. You pay more real dollars if you make more money, but you dont pay a higher percentage

I take it you are not a capitalist.

“It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion” -Adam Smith

Patrick:

I’m not sure that definitions that are over 100 years old are all that relevant to this discussion. As I define capitalism, I’d say that I am indeed a capitalist, in that I believe that money comes from inspiration and perspiration. I believe its earned, not given, though in some cases, it might be earned by the father and mother and given to the son or daughter etc.

My suggestion for a flat tax doesn’t exclude me from being a capitalist, if that is what you are suggesting. I actually supported the idea of the wealthiest paying a slightly higher proportion than the rest, while the poorest pay a slightly lower proportion than the rest. I say that out of pragmatism, since its easier for someone with a high income to absorb a 5 or 10% higher tax burden than it is for someone with a low income.

But our tax laws have gotten out of whack, and need to be revised. I dont agree with those who say the rich should pay a vastly higher percentage of the taxes simply because they can afford to. They should, in my opinion, pay more in real dollars and slightly more in percentage. What is your take on that?

joebagodonuts,

I’d say if you add up ALL the taxes people pay (gas, income, payroll, capital, license fees, etc) the tax is already flat. And that’s for only the honest people.

There is an ever increasing number of wealthy people (and corporations) which pay zero income taxes (yet take in incredible revenue).

What we have today is the redistribution of wealth, and it only flows up. Our current tax laws are a big part of that problem. An example is that in 1977 the wealthiest 1% had as much as the bottom 49 million Americans (after taxes). By 1999, that 1% had as much as the bottom 100 million. The net flow of dollars is upward.

Indeed our tax laws have gotten out of whack (since the early 80’s) and it’s just getting worse. A flat tax (or near flat tax) on income will just compound the problems. A good book on the matter is Perfectly Legal : The Covert Campaign to Rig Our Tax System to Benefit the Super Rich—and CheatEverybody Else. (I had this as a link to Amazon, but it’s taking too long to get through the edit review :)

Also, we often go back for historical support of an augment. We quote our founding fathers in support of our ideas about liberty. So, it seems to me that good advice is timeless :-)

“What improves the circumstances of the greater part can never be regarded as an inconveniency to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.” —Adam Smith

Patrick:

I dont understand your first comment. A flat tax is essentially a tax where the percentage paid is the same for all economic stratas. What you seem to have focused on is a user tax, which isnt necessarily flat at all. I’d say if you add up all the taxes, we pay too damn much in taxes. But it still wouldnt be flat, as i see it.

What has also happened with the US is that we give more money to people than ever before. We need to have everyone involved in the give and take of the economy, rather than having many involved in the “take” aspect. That’s also where a flat tax helps out, in my opinion.

But….for it to really work, we gotta rein in politicians who are spending our money willynilly. They waste too damned much money—-we’d be better off without em.

Allow me to explain.

I was talking about the big picture. The proportion of tax paid as regard to revenue. And the sick thing is, we all pay about the same proportion of our revenue already. If we make the income tax flat (or near flat), then the rich will pay LESS percent overall. That’s not fair!

I’d also say any statistic that’s akin to “…more people then ever before” is a hollow statistic. It’s like saying more people own their own homes then ever before, or there’s more Americans breathing air then ever before. That last bit is the give away… There is simply more Americans then ever before.

If you want an example of “taking” you only have to look at our wacky tax enforcement laws. We hound the poor who try to get the earned income tax credit. The government allocates more then $100 million a year to audit these would be tax cheats. The max earned income tax credit is about 4 grand for family’s making around $13,000. The government spends the money and time and these working poor are 8 times more likely to be audited then those making more then $100,000. Now if you happen to be rich, like Peter R. Kellogg, you just set up a tax-free insurance company, funnel “capital” through it, and through the years 1996 to 2001 fleece the government out of $188 million he would have to paid in income. TALK ABOUT TAKING!

It’s disturbing. And what’s weird is it seems you are blaming the poor (maybe just a bit). And yes i agree, we ought to “rein in” these politicians. I bare in mind that it’s the Republican majority that has eroded our fair tax system. They have increased the tax code (laws) from 40 some thousand pages, to over 60 thousand pages. They have “raised” our taxes by way of the deficit (we got to pay it sometime). The have produced the most pork barrel filled legislation in history (highway bill). They have made government less efficient by growing it uncontrollably. They refuse to investigate war profiteering (missing 8 billion in Irag funds). And they refuse to investigate their own inappropriate political fund raising (golf trips to Scotland).

I know how to “rein in” these politicians, and I’m afraid you are just going to excuse them by way of your vote.

I’m often amazed at the backlash us Liberals get. The Republican’s have control of the house since 94, the Senate since 98, the Executive branch since 2000, and the Supreme Court. They control what gets legislated, what gets signed into law, and how the ultimate court interprets those laws, and us Liberals still get blamed. It’s a wonderful racket.

Has anyone thought of the revenue that will be generated by illegal immigrants that sneak into the US, get cash jobs and do an enourmous amout of purchases during their stay? Right now they are not taxed. HR25 will provide a means of taxing them. What about the dope dealer that buy hundred thousand dollar boats, airplanes, cars, etc. With no loop holes where will they be able to hide their ill gotten gains? They will be taxed also. Until they are caught they will also add to the kitty. Big busines doesn’t want to get rid of the loop holes that they now enjoy and can bury their tax dollars in. Why should it take 80,000 pages of IRS regs to govern how taxes are paid. How can anyone interpret them? If not this Fair Tax, then what? We need to start over with something new and fair. Would some of you dooms dayist come up with something better than this that will replace what we have??? I’m open!!!

Pancho

Look at it this way. Of the estimated 3.5 million illegal immigrants in the country, if they spend $100 per week, they pay $23 in taxes. That’s $80.5 million per week X 52 weeks = ± $4.2 billion per year additional revenue that is now not collected.

Taxes on income or real property are totally regressive and do nothing but discourage people to improve their lives or real estate. The Fairtax is the most brilliantly conceived idea on taxation we have ever seen. Hopefully once it becomes law the states will see its wisdom and repeal property taxes and replace them with a consumption tax. Lets get our freedom back and make ownership a reality.

My 11 year old car needs to be replaced.

The local 7% sales tax is keeping me out of the market.

Adding another 23% sales tax, well …