Third Party & Independents Archives

August 31, 2007

The GOP's UN-Fair Tax Goal

Unable to make any headway in the Congress for a national retail sales tax, now referred to as the “Fair Tax” proposal, proponents have embarked on a different strategy. And so far, it’s working.

When Republicans were in control of Congress, a debate was begun on how to eliminate the progressive income tax system which imposes higher rates for those accruing greater incomes. The two main alternatives to Income Tax reform were the Flat Tax and the Sales Tax (now spun into the "Fair Tax" by name). Republicans now champion the "Fair Tax" proposal which would impose little to no taxes on person's and corporations of wealthy means. But, how to force the "Fair Tax" option into the 2008 race, in the absence of any major candidates championing it as part of their campaign, was the question posed to its proponents. They came up with an answer.

The Washington Times, in a piece of high spin writing, reports:

[Fair Tax] supporters have taken a decidedly outside-the-Beltway approach to stirring up support, using activists in places like Iowa and early-primary states such as Florida to try to win attention in the presidential contests.

"We got there by deciding there were a few places in the country that candidates had to talk face to face with people," said Ken Hoagland, the spokesman for Americans for Fair Taxation, the nonprofit group pushing the FairTax. "We knew that people love the FairTax, and we would have very little success lobbying in Washington, so we took our message to people in the primary states and asked them to take the message to the candidates."

The article goes on to say that such a bottom up strategy of getting proponents into these campaign areas to encourage Republican voters to ask the Republican candidates about their stand on the "Fair Tax" plan, has had some success. The Times article explains that six GOP candidates have signed on. They report Mike Huckabee was asked about it by so many potential supporters while campaigning, that he was forced to inquire into the plan, obtain a copy of it, and upon reading it a couple times, concluded that he will champion it as part of his political campaign for President.

As far as this bottom up approach to forcing an issue into an election campaign, this strategy is proving successful. Another aspect of the strategy is more commonplace and familiar, highlight the positives and never speak of the negatives, leaving those to the plan's opponents, which will in part, paint the opponents as naysayers by their own words. The Washington Times partakes in this strategy adding the following 'highlight the positives' commentary:

Supporters say they could abolish the income tax, the Internal Revenue Service and the April 15 paperwork headaches and replace it with a 23 percent tax on all retail sales. There are no exemptions, but the government would pay a monthly rebate to every taxpayer to make up for what is spent on essentials such as food and clothing.

At first read, it sounds good. Yet, there are some contradictions here upon re-read. What agency of the government is going to process those rebates to the poor? Surely, some form of Internal Revenue Service will need to oversee that process. So the argument that the Internal Revenue Service would be eliminated is only partially true. Then there is the direct contradiction in one sentence, there will be no exemptions except for low income consumers who will be exempted in part via rebate checks on taxes paid for necessities.

But, critics of the plan have ample evidence to counter-attack this proposed revenue strategy besides those made obvious in the selling points. Wealthy persons have tax incentives to give to charity. With a sales tax system, the tax based incentives for charitable giving are gone.

Next would be critic's question: Who doesn't pay a fair share for government services? Answer: the wealthy folks in America and corporations and businesses. Bill Gates tax returns are not publicly available as far as I know. But, it is safe to say, that Bill Gates average spending for his personal life is insignificant compared to his annual income and net wealth. Bill Gates Microsoft shares alone amounted in the last year to $25 Billion dollars. Even if Bill Gates purchased 10 million dollars a year of goods and services in the U.S., his sales tax contribution to pay for federal government services and benefits would amount to less than 2.4 million dollars assuming "Fair Tax" rates of 23%.

Sounds like a lot. But, consider this. Bill Gates wealth has increased each year since the initial offering of Microsoft stock in 1984 by 1.15 billion dollars per year, on average. Based only on his MS stock holdings, his percentage of tax to income is 2.4 million divided by 1.15 billion, or, 0.2 percent, or 2/10's of one percent of his annual increase in wealth. Of course this percentage would be smaller for Bill Gates, because his net annual growth of wealth in other stocks, bonds, income and holdings is significantly more. Compare this to a wage earner making $60,000 per year who spends $60,000 per year whose tax rate is 23%, nearly one fourth of all their annual income.

It is also important to note, that Bill Gates utilizes far more government services than the $60,000 per year wage earner. Bill Gates uses our roads and bridges, trains, and airways far more than the average worker, all of which receive federal tax dollars and serve Microsoft's needs for shipping his products, employees, and supplies. Gates uses far more of the Securities and Exchange Commission's services, Fed. Communications Services, Fed. Trade Commission's services, Interstate Commerce Commission's, US federal court services, and other federal government services which protect his business and ability to enforce his contracts, patents, and trademarks, domestically and internationally.

Microsoft too would be largely exempt from taxes, since it purchases an extremely small amount of retail goods and services, and wholesale goods and services would not be taxed under the "Fair Tax" plan, which does not include a value added tax, commonplace in Europe, which insures business pays a share of the government services which it benefits from.

In addition, the national sales tax proposal would completely eliminate corporations and businesses from paying a share of the costs for the very government that protects and defends the marketplace in which they create their profits. Further, the sales tax would, according to some proponents, also remove employer's incentives and obligations to provide health care insurance, retirement pension plans, and other programs like 401K matching as part of their compensation packages for their employees. This would not come about in the initial passing of the so called "Fair Tax" plan, but, would follow as amendments to the system as their lobbyists coerced and bribed Congresspersons seeking reelection to erode these obligations in subsequent bills.

Hence, the net effect of a national retail sales tax critics will argue is this: Those who use the most of federal government's services, and benefit most from them, would pay the least percentage of their income in taxes to fund government services. This is precisely why Republican's needed to create the misnomer name for this sales tax proposition that would counter the truth of it on its face by calling it the "Fair Tax". It would be anything but fair as those with the most earned dollars and biggest users of federal services, would pay little to nothing for those government services, compared to their less fortunate fellow citizens.

It would be a mistake for current Income Tax reformers and Flat Tax proponents, to underestimate the power of Republican's salesmanship on this issue. Their grass roots up strategy to promote the national sales tax agenda can be enormously effective. The reason is that it is being sold to voters before they have the opportunity or benefit of counter arguments or debate. Which means by the time this proposal is introduced in Congress for debate, a large segment of the population will have already been sold on the idea, and view protest and debate by Democrats as purely partisan having no merit. It is a brilliant strategy which should not be ignored.

Posted by David R. Remer at August 31, 2007 01:17 PM
Comments
Comment #231141

David,

Your displeasure with the Fair Tax is showing again, let me fix a few things you’ve gotten wrong.

What agency of the government is going to process those rebates to the poor? Surely, some form of Internal Revenue Service will need to oversee that process.

No, the Social Security Administration, already in place and a separate entity, would take care of this as they are going to continue in existence.

Then there is the direct contradiction in one sentence, there will be no exemptions except for low income consumers who will be exempted in part via rebate checks on taxes paid for necessities.

Again, no. EVERYONE will get a rebate check, not just the poor. This is what is meant by no exceptions.

Bill Gates uses our roads and bridges, trains, and airways far more than the average worker, all of which receive federal tax dollars and serve Microsoft’s needs for shipping his products, employees, and supplies.

Sorry David, but how do you figure that Bill Gates, personally, uses more than anyone else? He is not his company, which is publically held, and he isn’t even in charge of anymore.

And his company should pay for those things. And would, if the Fair Tax was in place because it would be collected on not just SALES but SERVICES as well. So there would be a service tax that we don’t collect for now, one that would ensure those services get paid for by the people who use them. I’m surprised you aren’t a supporter of that.

But, then we’ve had this debate before and you’ve admitted that your primary goal for supporting the Income Tax is as a means of taking wealth from those who have it and get it to those who don’t.

Further, the sales tax would, according to some proponents, also remove employer’s incentives and obligations to provide health care insurance, retirement pension plans, and other programs like 401K matching as part of their compensation packages for their employees.

No David, that’s being done by the Democrats now, by pushing national health care and maintaining Social Security. Why would a company bother being involved in providing health care if the government will be doing it for them? Why have retirement plans when the Government is providing that for people already?

And remember, there are Democrats that do support it. It is the only way to make our tax system be open and transparent, something that most democrats say they want from our government.

And right now our poor pay the income taxes of the workers who make products, as it is passed onto them, without being able to see it. This way they can have their necessities tax free. Something that we can’t give them now.

Posted by: Rhinehold at August 30, 2007 11:24 PM
Comment #231213
There are no exemptions, but the government would pay a monthly rebate to every taxpayer to make up for what is spent on essentials such as food and clothing.

Okay, then why tax these at all? Or how do you prove how much you spent on food and clothing? Isn’t that pretty much what we do now filling out income tax forms?

Posted by: womanmarine at August 31, 2007 02:35 PM
Comment #231215

Rhinehold, whether or not Dept of Defense or the Social Security Admin. oversees the disbursement of tax checks, a function of the Internal Revenue Service is preserved. A rose by any other name …

Rhinehold said: “Again, no. EVERYONE will get a rebate check, not just the poor. This is what is meant by no exceptions.”

That’s your version. There are others. No exemptions means no one is exempt from the sales tax. But, in fact, a rebate on certain goods and services IS an exemption. It is a contradiction. Worse, is the fact that if this plan were passed, it opens the door for the wealthy special interests to lobby for a host of rebate exemptions designed to favor them. Once you make an exception for what is rebated, many more will follow. If our current tax system has taught us anything, it has taught us this.

Rhinehold asked: “Sorry David, but how do you figure that Bill Gates, personally, uses more than anyone else? He is not his company, which is publically held, and he isn’t even in charge of anymore.”

What a bogus question this is. Tell me who is the primary compensation beneficiary of an enterprise and I can show you who has a controlling interest in that enterprise. Don’t even try to play this corporations are not humans game with me. That is a conservative argument that has never held up. The legal separation of corporate liability from Board of Directors and Investors liability in no way nullifies ownership stake in the corporation.

Bill Gates benefits directly from his share holdings in Microsoft, and therefore benefits directly from the government services which Microsoft makes enormous use of.

Capital Gains tax insures the beneficiaries of corporate use of government services pay their share of taxes to support those government services. The “Fair Tax” exempts Microsoft from any taxes for those government services as it is not a retail purchaser of significance, and it limits extremely wealthy beneficiaries of stock holdings to the barest of fraction of a percent of tax obligation for those government services.

The Fair Tax plan allows the corporations and businesses to use maximum government services at no cost, and collects a negligible amount of taxes from those who are the largest corporate investors and beneficiaries of profits of that corporation.

In reality, the Fair Tax plan puts the greatest burden of taxes to support business use of government services on the middle class who will pay the highest share of taxes to earnings ratio, while the wealthiest pay the lowest share of taxes to earnings ratio. This fact is undeniable and irrefutable.

The so called “Fair Tax” plan, a national retail sales tax plan, has some positive benefits. But, there is no way around it. The primary beneficiaries of this plan are the wealthiest and the corporations. It is why it is a GOP plan.

I wrote this article to alert folks to the fact that this plan can be sold on its merits to the grass roots in an environment in which there is no debate and no counterpoint of view. I am confident 99% of Democrats who hear a rational debate about this plan will oppose it, mightily. It is a Republican wet dream to have workers pay the bulk of costs to support the society leaving the wealthy as free of such burden as possible in order to “free up capital investment” which in turn can make the wealthy even wealthier.

Like I said, this plan is anything but Fair, and at the same time, has the appearance and selling points to make it appear like a panacea to working Americans where objective analysis and debate about it is absent.

Posted by: David R. Remer at August 31, 2007 03:01 PM
Comment #231216

womanmarine, there are two options. Make consumers into bookkeepers and receipt keepers and ask them to document their sales taxes as part of the process to get rebates, OR, the government decides what is the average sales tax spent by persons in your income group and rebates you on that average.

But, the cost of living for essentials varies considerably from state to state like Alaska and Nebraska as examples. Something to consider.

Posted by: David R. Remer at August 31, 2007 03:04 PM
Comment #231222

David:

The “fair tax” wont work. Here is why. In tax “theory” it is better to have many “little” taxes than fewer “large taxes”. The reason is that if the tax rate is high it encourages avoidance and fraud. If you eliminate all of the taxes they say and place the tax burden all on one place “consumption”, you drastically increase the insentive to cheat.

In theory I would prefer would be small transaction fees on such things as mutual fund and real estate transactions and a reduction in dependence on income taxes. The main point is the spread the ways we are taxed without adding to the total tax bill. This reduces the incentive to fraud because who want to go to jail for a $5.00 fee?

These smaller taxes are now possible because of the increase in technology.

we may disagree with the “fair tax” for different reason. I just think it could create a huge black market to have sales taxes that high.

Craig

Posted by: Craig Holmes at August 31, 2007 04:00 PM
Comment #231225

Craig, your point is a very interesting and controversial one.

Interesting, because one of the major selling points for the Sales Tax plan, is that it would lasso current black marketeers into paying taxes, as retail consumers in the legitimate consumer marketplace.

Controversial, because it is not demonstrable that crooks would be able to obtain wholesale goods without paying retail taxes. You are correct that the sales tax scheme would strengthen incentives to grow the used marketplace for items like cars and appliances sold through apparent individual sellers.

But, your line of thinking does imply the need to explore the potential for small scale mfr/seller relationships which acquire competitive advantage by bypassing storefront sales tax collecting type operations. That said, it is not possible to know if the competitive advantage would justify the increased risk of being caught.

I am inclined at the moment to think the sales tax plan would be less subject to tax avoidance and cheating than the current system.

That said, I think the Flat Tax plan would achieve compliance growth sufficient to offset comparative advantage of the sales tax plan, for no other reason than the perception of it being a fairer plan. Compared to both sales tax and our current flexible rate and targeted group income tax systems which would motivate cheating on the perception that they are not fair.

Posted by: David R. Remer at August 31, 2007 04:14 PM
Comment #231226

BTW, there is a false implication made by Huckabee and other ‘Fair Tax’ proponents that this plan would eliminate tax evasion by black marketeers. This is just plain false. Prostitution, illegal gambling, drugs, and counterfeit products would continue to operate without collection and payment of sales taxes on their sales.

Posted by: David R. Remer at August 31, 2007 04:18 PM
Comment #231227


If the American people are stupid enough to fall for this scheme they deserve it. This nation was cruising along quite well until the Age of Reagan and it rich men shouldn’t pay taxes philosophy. Now this nation is trillions of dollars in debt and they still are’nt satisified.

For sixteen years, The Republicans have dominated politics in Ohio. In that time they never saw a progressive tax they couldn’t cut nor a sales tax and licence fee they couldn’t raise. The results, last in job creation, last in new business startups.

Posted by: jlw at August 31, 2007 04:25 PM
Comment #231240

How sad…a family of 5 can’t live on $168,000 a year…wouldn’t most of us love to have that problem…

Snow insisted his cancer, which was believed in remission when he took the job in May 2006 but then was discovered to have metastisized, was not the reason he was leaving more than one year before Bush’s term expires.

“Why? Because I ran out of money,” Snow said when asked why he was leaving.

“I made more money when I was in my previous career,” said Snow, whose White House salary was 168,000 a year.

Does anyone live in the real world anymore???

Posted by: Rachel at August 31, 2007 06:05 PM
Comment #231241

Good article David. This is scary stuff. I hope the Democrats don’t roll over and play dead if this is ever introduced as legislation.

The only complaint I have is I think you should have picked some other multi billionaire other than Bill Gates. Gates is the most philanthropic person in the history of mankind. You could have found someone who is more of a scoundrel to pick on rather than Gates I think.

But back to the main issue, this “fair tax” or incredibly regressive bankrupt the middle and lower classes tax is terrible.

Posted by: Richard Rhodes at August 31, 2007 06:23 PM
Comment #231242

Sure … the FairTax looks attractive, and it’s no wonder why the bought-and-paid-for puppets (Do-Nothing Congress) and their big-money-donor puppeteers want a 30% sales tax. It will reduce their taxes. But it will hammer the middleclass, since they spend most of what they make (evidenced by the nation’s current negative savings rate).

That is, most people (the middle class) spend almost everything they make. Therefore, most (if not all) of what they make is taxable.

But the wealthy (especially the hyperwealthy) can’t even remotely spend all their income. Their income grows and grows. They earn lots of interest that is currently taxed at a rate lower than the average person pays. That is, Warren Buffet paid a lower percentage of income tax than a secretary making $60K annually, because capital gains are taxed at 15%.

And a 30% inclusive sales tax is much too high. It will most certainly lead to blackmarkets.

All that is needed is simplification of the current system by removing ALL tax loopholes and taxing income above the poverty level at a flat 17% (thus eliminating a pre-bate). But that would make too much sense, and the puppets and their wealthy puppeteers don’t want it because they know damn well it would finally make everyone pay their fair share of taxes.

Posted by: d.a.n at August 31, 2007 06:34 PM
Comment #231245

D.a.n, quite right. And this “Fair Tax” proposal eliminates estate taxes, capital gains taxes, and other investment taxes, finally opening wide the doors to a true plutocratic led government. Rule by the wealthiest (lobbyists and campaign donors).

jlw, I wouldn’t call the public stupid. This strategy of selling the plan from the grass roots up however, is brilliant, because it sells the plan on its strengths, hides its downsides, and convinces the unwary public on the plan outside any venue for debate our counterpoint as found in this article.

Richard, you are correct about Gates. His wealth is so vast the IRS actually has to use an entirely separate computer system to calculate his taxes alone. (This was reported by Gates himself). When you are that wealthy, you can easily afford to be the most philanthropic person in the world, taking nothing away from Gate’s decision to do that. Gates though was an excellent example because few wealthy person’s wealth is publicly avaialble. Gate’s wealth on his MS stocks was easily available and calculable, to make the point that his share tax rate would be 2 tenths of 1 percent based on his MS stocks value alone.

Posted by: David R. Remer at August 31, 2007 07:01 PM
Comment #231248

I can’t believe I didn’t notice this the first time but after rereading the article I remembered that this tactic which the Fair Tax propopents are using was first introduced by Ed Grefe, one of my professors at GWU, in his book The New Corporate Activism: Harnessing the Power of Grassroots Tactics for your Organization.

Posted by: Richard Rhodes at August 31, 2007 07:20 PM
Comment #231250

Also co-authored by Martin Linsky, author of: Leadership on the Line: Staying Alive Through the Dangers of Leading

Ed Grefe also authored: Fighting to Win: Business Political Power

Not surprising.

Posted by: David R. Remer at August 31, 2007 07:31 PM
Comment #231254

It’s not surprising to me that Huckabee is supporting the ‘Fair Tax’. From what my sister over in Arkansas has told me the guy aint never seen a tax he don’t like.
I’m personally against any kind of consumption tax by any name. Yeah the rich pay as well as the poor. And they just might pay more because they’ll by the big ticket items. But they’re already doing that because they do buy the big ticket and higher end items. But it also makes it harder for the poor to be able to afford such luxury items as food, clothes, and medicine. And there are a number of states that have sales tax on food and medicine. And all states have sales tax on clothes.
I haven’t personally read the ‘Fair Tax’ plan and don’t know if it taxes food, or medicine or not. But even if it doesn’t now I can almost guarantee it will in the future. Specially with the tax and spend Congress we have now.
The only fair tax is a flat income tax with absolutely NO deductions and no cut off for ANY income level. And yeah I’ve heard the argument that the rich won’t pay any more than the poor and that’s wrong.
HOGWASH! While someone making $100,000 would be paying the same rate as someone making $10,000 they would be paying in more because they make more. At 10% the person making $100,000 would be paying in $10,000 where as the person making $10,000 would be paying in $1,000. And the person making $1,000,000 would be paying in $100,000. and they all would end up with exactly the same percentage of their income in their pockets. 90%.
I know, How can that be fair? The guy making $100,000 has $90,000 left where the guy making $10,000 only has $9,000 left. IT’S STILL 90%.
If the person only making $10,000 wants more money all they have to do is do what it take to make more more money. And they’d have more incentive to make more money because they won’t punished for making it by having it taken away from them by being put in a higher tax bracket.

Posted by: Ron Brown at August 31, 2007 07:37 PM
Comment #231255

d.a.n
It seems the only places where we disagree on the flat tax are the percentage rate and an income cut off level.
The percentage is just a matter of preference.
As far as noone under a certian income level paying income tax I don’t see why. They use government services just like everyone else, and maybe more so. Let them help pay for these services.

Posted by: Ron Brown at August 31, 2007 07:46 PM
Comment #231259

LOL looks like you got some attention David look at the featured link from google its an ad for the Fair Tax.

Haha now thats funny.

Posted by: Richard Rhodes at August 31, 2007 08:43 PM
Comment #231260

Those of you who are complaining about the FairTax Plan obviously either haven’t read the plan or have an agenda against the rich.

Read the plan, figure your taxes using the IRS plan and again figure your taxes using the FairTax Plan. Every income group I’ve calculated comes out better with the FairTax Plan.

Please tell me how that is wrong.

Posted by: tomd at August 31, 2007 08:46 PM
Comment #231262

tomd, how about you show us your calculations first. That we can be sure you are not wasting our time.

Posted by: David R. Remer at August 31, 2007 10:03 PM
Comment #231265

So fair tax proponents, if I buy 1 share of stock for $1 then I would pay $1.23 + 4% to the broker. Then I wait until the stock goes up 27% before I break even?
In addition to the payment I pay on my home loan every month I would now pay an additional 23% every month on the principal or principal interest and insurance? Or would I pay 23% due when I buy the house which would mean instead of 20% down I would need 43% down? Or if I were to be only able to pay 10% down would I have to pay 23% on the PMI I would need to get the house financed?
I take it this tax would be in addition to the 7 to 8% common in most states. And in addition to the property tax we currently pay to the state. And in addition to the fees we pay for tags etc. currently as it is a federal tax or is the plan to give all taxing power to the feds only?


Posted by: j2t2 at August 31, 2007 10:14 PM
Comment #231267

Tomd:

How the hell can some calculator know how much I spend on food and clothing? I don’t keep track of that.

Posted by: womanmarine at August 31, 2007 10:34 PM
Comment #231268

Ah. We get a “consumption allowance” from the government. Now why wouldn’t I be for that?

Posted by: womanmarine at August 31, 2007 10:36 PM
Comment #231269

David:

Well the flat tax is going exactly in the opposite direction as I believe. I am for keeping tax revenues the same or lowering them, but with many more ways of collecting them, as it reduces temptation to fraud.

In my state the tax rate would be well over 30%.

A better idea would be to add tax systems that can easily be collected because of technology. (VAT, small transaction fees on home sales, mutual fund transactions etc). Then for instance a high exemption could be added to income tax and take millions off of the tax rolls.

Just to repeat myself, the “fair” tax is moving the country in the wrong direction.

Besides, it’s old school. Why not use our computer systems and be a little more creative?

Craig

Posted by: Craig Holmes at August 31, 2007 10:42 PM
Comment #231270

Even their ad is full of deceptions and lies.

The only Democratic candidate supporting UnFair Sales tax is: take a guess! Mike Gravel! You know, the candidate no one knows what he stands for. Well, now you know. And with Gravel on board, this group can now advertise they are supported by Democrats and Republicans alike. Obama flat out told a supporter he could not support it as it would be a regressive tax and could easily result in even higher deficits.

The TampaBay arm of FairTax makes the following claims:

Candidates who have expressed serious interest:
• Retired General Wesley Clark of Arkansas
• Former Vice-President Al Gore of Tennessee

I guess that is supposed to garner Democratic support. Hell, I was interested too, which caused me to go to their site, but, I was adamantly opposed to the UnFair Sales Tax plan and went to their site for evidence of how they are promoting this.

FairTax.Org makes the following statement on their web site: The FairTax Act (HR 25, S 1025) is nonpartisan legislation. It abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax administered primarily by existing state sales tax authorities.

If it’s non-partisan, why are they reaching so hard to imply support by Gore and and Clark?

By abolishing Medicare and Social Security, insurance against poverty will fall upon consumers to choose not to buy taxed items to save the sales tax for their own medical and retirement needs. I can say this, because the future shortfall on Soc. Sec. and Medicare is in the trillions and the Fair Tax.org sells this plan on a revenue and deficit neutral .23 cents per dollar national sales tax. The tax is enormously insufficient to meet the needs of Social Security and Medicare, especially given the loss of tax revenues by the wealthiest 5% of Americans, who as FairTax.Org says, will pay no “corporate income taxes, gift, estate, capital gains, alternative minimum,” taxes and no self-employment taxes literally bashing open the doors for cash only basis businesses whose dealings will be entirely outside the purview of the public and government. Libertarians will praise this, as will Republicans backing wealth and big business exemption from taxation, compared to the substantially higher rates they now pay.

Which begs the question. If he wealthy are off the hook for the taxes they now pay, who in American society is going to make up the short fall? The great Middle Class whose earnings are mostly or completely spent each year on consumption. There is no way to escape the logic consequence here.

And Obama is absolutely correct. With entitlement spending about to grow dramatically, either enormous deficits and growth in national debt or, much higher than .23 per dollar sales tax will have to become reality. That, or of course, abandon Soc. Sec. insurance and Medicare altogether, which is no doubt part of the unspoken design of the UnFair Tax plan.

Posted by: David R. Remer at August 31, 2007 10:47 PM
Comment #231274

Excellent article, David. You can tell it’s a scam just by the fact that they had to rename it the “fair” tax.

It’s always that way with these guys: The “Healthy Forest” initiative that subsidizes cutting pristine forests by the logging industry, the “Clear Skies” program that actually rolls back protections in the Clean Air Act, etc.

You don’t have to apply a feel-good name to a good initiative. It’ll be obvious.

Posted by: American Pundit at August 31, 2007 10:58 PM
Comment #231275

David:

If this passes, I can hardly wait to see gramma up against a wall with her bow legs spread being frisked for trying to bring goods across the boarder from Canada. She will beat the hell out of those boarder guards.

Can you imagine how much stuff our elderly females can bring across the boarder in those baggy dresses?

One of them might me my own mom. She is pretty cheap. I don’t want to have to visit her in prison for tax evasion.

Piling up all the taxes into one system is stupid. It will make criminals out of usually honest people as they seek to avoid the tax.

Craig

Posted by: Craig Holmes at August 31, 2007 11:03 PM
Comment #231279

Here is an example. A family of 3 earning $65,000 and spending all but 6% which goes into a 401K on annual living costs, currently pays a federal tax of about $10,000.

Under the UnFair Tax plan, excluding their 6% 401K, their tax will be 23% of non-essentials. Their site indicates for this family in the contiguous 48 states the annual rebate for essentials would be $5,947. So of $65,000 subtract $6000 for 401K and $5,947 for essentials. They would pay .23 per dollar on the remaining $53,053, or $12,202. Already $2000 more. But, that’s not the end of it.

Under the UnFair Tax plan the incentive for their employer to match their 401K saving is gone, entirely, no tax break for the company. So, this same family loses an additional $6000 per year as a result. Now add increases in broker fees for 410K or other retirement plans which brokers will pass on to the 401K investor since for brokers, broker fees are consumption taxed: let’s estimate 2% broker fees on $6000 which is $120 and 23% of that as tax passed on equals $27.60 for this family.

Total net difference for this family:
Current $10,000.

UnFair Tax Plan:
$12,202 basic Consumption tax
$6000 lost 401K matching
$27.60 additional broker fees
——————
Total under the UnFair Tax plan = $18,229.60.

This is a simple scenario. It gets a whole lot more complicated for many more of the middle class, as some have pointed out above. Plus, this plan makes no allowance for cost of living differential in the lower 48. They do give adjustments for Hawaiians and Alaskans higher cost of living adjustments.

There is a lot to mistrust and dislike in this UnFair Tax plan.

Posted by: David R. Remer at August 31, 2007 11:17 PM
Comment #231280

Craig, can you imagine the explosion in black market stolen goods under this plan. Used goods are not taxed. Windfall for thieves and fences of stolen property. Yours, mine, whom ever’s.

Posted by: David R. Remer at August 31, 2007 11:18 PM
Comment #231281

Here’s the problem with the flat tax that people don’t see.

If I make a widget, I have to pay income tax on that widget. So to clear XXXX each month to buy things like food and such, I have to charge what the widget costs, and operating expenses, AND the income tax that I pay. So the income tax I pay goes into the price of the product, which everyone now pays when they purchase that product.

Now, if I don’t have to pay for that income tax, I can make the same amount of money that I need to make while dropping the price of my widget.

Now I add a sales tax onto that widget that equals roughly what the income tax was removed was.

So we don’t pay any more for the product, but those taxes that we are paying are now SEEN, not hidden. And we can choose to do something about it, like tell congress that they are taxing us too much. That’s the real reason that people don’t want those taxes visible, it’s because we would finally see how overtaxed we are.

And, how do I know this? Well, I trust the people who know what they are doing who have run the numbers. One of the leading economists supporting the FairTax is Dr. Laurence Kotlikoff of Boston University.

A sales tax is also more stable in revenue than an income tax that goes up and down wildly as the economy rises and falls, while people still need to purchase things during the lean times and the good.

Now for several of the incorrect statements

That’s your version. There are others.

No, David, there is one. It is HR 25/S 1025. There may be other ‘sales tax alternatives’ but there is only one Fair Tax, it has been written down and introduced into congress.

http://thomas.loc.gov/cgi-bin/query/z?c110:H.R.25.IH:

http://thomas.loc.gov/cgi-bin/query/z?c110:S.1025:

But, the cost of living for essentials varies considerably from state to state like Alaska and Nebraska as examples. Something to consider.

Why is it something to consider now but when I bring that up when talking about a ‘minimum wage’ I’m told that I’m just being contrary?

I agree that we should make the check dependant upon the cost of living where you live, based on zip code, but if I waited around for ‘perfection’ we would not have any change in our current tax code and the immoral action of taking money from people’s incomes, without their compliance, we would never get anything done. Let’s get closer and see what we need to change just as we have done every year before.

This nation was cruising along quite well until the Age of Reagan and it rich men shouldn’t pay taxes philosophy

Just fine? I’m assuming you aren’t old enough to remember the Carter years, long gas lines, forced energy conservation and rationing, and are just repeating partisan points…

But it also makes it harder for the poor to be able to afford such luxury items as food, clothes, and medicine
I haven’t personally read the ‘Fair Tax’ plan

I could tell, because you would know the answer, even David and I mentioned it previously.

I would recommend everyone who is going to rail against the plan at least read something about it, something other than a moveon.org article, that details what it is and what it is not. www.fairtax.org is a good place to start, or you can go to http://en.wikipedia.org/wiki/FairTax to get started. Otherwise when you make statements that are obviously not accurate it makes the rest of your arguments harder to assign credibility to.

The Fair Tax plan allows the corporations and businesses to use maximum government services at no cost,

Wrong. Those taxes are just not taken out of their income and instead collected differently.

I take it this tax would be in addition to the 7 to 8% common in most states.

You are paying this tax already at the federal level, you seem to think it is an ‘extra’ tax? You don’t understand, in order for this to pass a constitutional amendment rescinding the 16th amendment. Which means no income taxes. No more HIDDEN taxes on everything we buy and all services we use. Instead these taxes would be visible and we would know how much we are paying in taxes.

And our taxes would not be taken from us without our assent any further.

And our poor will be paying no taxes instead of the multitude of hidden taxes they pay now because we can’t identify it or eliminate it from products and services.

How could that be a bad thing, to eliminate the tax burden, completely, from our lowest income/no income families?

The PROBLEM is that the 50% of Washington that now makes it’s living from doing nothing more than lobbying to manipulate the tax code would be out of a job. Which is one of the other good reasons to support it IMO.

Posted by: Rhinehold at August 31, 2007 11:20 PM
Comment #231282
This is a simple scenario

It’s also invalid. You leave out the drop in price for goods and services that would occur because the HIDDEN income tax that we already pay (calculated by economists to be…. 23%) would no longer be in the price of the product.

So, you might want to try your ‘simple’ scenario again an other than ‘unfair’ way.

A detailed 2006 study published in Tax Notes by Beacon Hill Institute at Suffolk University and Dr. Kotlikoff concluded the FairTax would be revenue-neutral for the tax year 2007 at a rate of 23.82% (31.27% tax-exclusive)

You also say:

Under the UnFair Tax plan the incentive for their employer to match their 401K saving is gone, entirely, no tax break for the company.

No, you assume the only reason that corporations match 401k investment is because of the tax break. If that were the case, why would most of them stop at 6%? Why not match as much as the employee would put into the plan?

BECAUSE the main reason for 401K matching is to attract the best worker. If it is demanded, it will continue.

BTW, you must then be against national health care then, right? Because there would no longer be a reason for businesses to supply insurance to their employers if the government is providing insurance to each individual in the US, is there? Or is there a different thinking going on that I’m missing…

Posted by: Rhinehold at August 31, 2007 11:26 PM
Comment #231283

Sorry, Rhinehold, but your purist belief in the noblesse oblige of corporate and large employers is one I cannot share. If what you said were true, Congress would not have had to offer the tax incentives now in existence. BUSTED! Your comment’s illogical and naieve belief in both the UnFair Tax plan and benevolent profiteers is beyond me.

My simple scenario substitutes current income tax with UnFair Tax consequences. Competition such as it exists, would lower commodity and service prices to some extent, but, your belief that businesses would not see the transition as a glorious opportunity to increase profit margins by NOT reducing prices fully, is hopelessly naive.

Posted by: David R. Remer at August 31, 2007 11:34 PM
Comment #231287

David:

And now of course you have to deal with revenue agents at garage sales. Of course at these “garage sales” will be all kinds of manufactured items. Computers, electronic gear. I imagine you can buy just about anything at the garage sale of the future.

Then again revenue agents will be arresting gramma again.

CH

Posted by: Craig Holmes at August 31, 2007 11:44 PM
Comment #231288

David,

They why wouldn’t they set their prices up by 23% now if they could get away with it?

The fact is, they COULDN’T or they would. EVERY SINGLE PRICE we pay now is set by the market, unless we allow the government to interfere. And if are under the illogical conclusion that the companies would not lower their price to get more of the market than their competition, then you have to admit that the only hope for the future of our country is to have the government set all prices.

You talk about ‘me’ being busted? Please, I’ve actually read and understand the plan, something that it is apparently you refuse to do because you realize that your goal of taking wealth from those who have it, at gunpoint, and giving it to those who do not, will be impacted by this plan. Which is why most progressives refuse to accept the plan as well.

BTW, Mike Gravel, Democrat candidate for the Presidency, is a supporter of the Fair Tax. There are plenty of reasonable Democrats who have read the plan, understand it, and agree with it who do not see it as a ‘way to get the poor’. In fact, it would help the poor by eliminating the taxes they currently pay and we can’t void for them. Why are so many democrats against that? Why, because someone with wealth might get to keep some of it. And that goes against their view of the purpose of government.

Posted by: Rhinehold at August 31, 2007 11:47 PM
Comment #231289

Btw, Mike Gravel’s comment:

“I subscribe to a sales tax system, most of which is included in what is called the Fair Tax. The Fair Tax meets the fairness criteria: simplicity, transparency and no exceptions.”
Posted by: Rhinehold at August 31, 2007 11:49 PM
Comment #231291
Excellent article, David. You can tell it’s a scam just by the fact that they had to rename it the “fair” tax

AP, It was always named the fair tax plan from the day it was developed. Not sure what you think it was called before.

Posted by: Rhinehold at August 31, 2007 11:51 PM
Comment #231292
By abolishing Medicare and Social Security, insurance against poverty will fall upon consumers to choose not to buy taxed items to save the sales tax for their own medical and retirement needs. I can say this, because the future shortfall on Soc. Sec. and Medicare is in the trillions and the Fair Tax.org sells this plan on a revenue and deficit neutral .23 cents per dollar national sales tax.

Again, you trot out this scare tactic that this plan will ‘eliminate SS’.

The plan itself not only states that this will not affect the Social Security collection or administration, it also states that it depends upon the SSA in order to list who gets the rebate checks. In no way is there any plan, or desire, by the developers of the Fair Tax plan to eliminate SS.

And you accuse the Republicans of using FEAR to get people to vote for them. Why is it ok when you do it?

Posted by: Rhinehold at August 31, 2007 11:56 PM
Comment #231297

Why would Warren Buffet lie about his Secretary paying a higher tax rate than himself?

Buffett blasts system that lets him pay less tax than secretary

http://business.timesonline.co.uk/tol/business/money/tax/article1996735.ece

I’ll not bother looking for a link right now but Buffet’s also said that he does get a Social Security check. And that would be right.

Posted by: KansasDem at September 1, 2007 12:13 AM
Comment #231298
d.a.n It seems the only places where we disagree on the flat tax are the percentage rate and an income cut off level. The percentage is just a matter of preference.
As far as noone under a certian income level paying income tax I don’t see why. They use government services just like everyone else, and maybe more so. Let them help pay for these services.
No one pays tax on the income below the poverty level. Not even the rich. We’re only talking about the first $18K or so. The 17% flat income tax is only on income above the poverty level. The point is, it doesn’t make much sense to tax people below the poverty level, because they’ll simply end up on welfare, and cost tax payers more with all the red tape and paper work. But it is only fair that no pay tax on the income below the poverty level.

As for the 17%, I arrived at that based on GDP, tax revenues, and then subtracted 1% (spending cuts). The reason 17% will be required for a while is because Congress has pilfered $12.8 trillion from Social Security causing looming shortfalls for decades to come.

Those of you who are complaining about the FairTax Plan obviously either haven’t read the plan or have an agenda against the rich.
I’ve read it. Had me almost convinced even. But it ultimately means that the middle class will shoulder the majority of the tax burden since they spend most of their income. The borderline poor especially get hammered.
Read the plan, figure your taxes using the IRS plan and again figure your taxes using the FairTax Plan.
I have. A 30% (23% inclusive) sales tax is outrageous. Like Craig Holmes said, such a huge tax in one place will lead to black markets. What would be better is a more reasonable income tax. We’ve had this conversation before.
Every income group I’ve calculated comes out better with the FairTax Plan.
Not likely since the middle class and low income groups spend most of their income.
Please tell me how that is wrong.

The FairTax is not a fair tax system.
It also would require significant unnecessary change, when all that is really needed is simplification of the existing system.

  • the FairTax.org recommends a 23% sales tax rate (23% inclusive, but actually, it is a 30% sales tax on the price of the item purchased). That is, if you buy a $100 item, your tax is $30, which is 30% of $100. It is a bit dishonest to call that a 23% sales tax, when most people understand sales tax to be a percentage of the item purchased. Fairtax.org calls it a 23% tax by calculating $30 on the sum of $130 ($30 / $130 = 23%). Either way, 23% or 30%, it is very high sales tax.
  • Such a high rate (23% inclusive, 30% exclusive) will almost guarantee blackmarkets and tax evasion.
  • There is less transparency of sales taxes collected, versus income tax (especially if you consider the number of sales to the number of people with income). Less transparency will breed more corruption.
  • There is insufficient proof to show that all will be taxed fairly (based on income). Since most people insist that the objective is to tax income proportionally the same (except the poorest below the poverty level), how does the fairtax plan prove that income will be taxed equally ? That is a very interesting point. If the main question about any tax system that is continually asked is “Will everyone (excluding the poor) pay their fair (or equal) percentage of tax related to income?”, then what does that tell you? It seems many people still want the end result of any tax system to be that everyone pays their fair (or equal) percentage of income (excluding those below the poverty level, which would pay zero tax). Therefore, if we are continually tasked with proving that any tax system, in the end, must fairly tax income the same percentage (excluding the poor who pay zero tax), then why not simply retain the income tax (but greatly simplified)?
  • Also, what the FairTax fails to point out is that prices (overall) can only fall if employers can cut their employees wages. It has to come from somewhere. Say your salary is $50K a year today, but you take home $40K after income taxes. Under the FairTax system, there would supposedly be a savings of $10K, and must be able to lower its prices accordingly, but ONLY by reducing your salary by $10K to $40K. Theoretically, your take-home pay is the same as before, since you now keep 100% of your income.
  • Many people (wealthy or not) have savings. They have already paid income tax on it. If the fairtax.org plan is passed, they will get taxed again 30% (23% inclusive) when they spend it. That’s double taxation. That will be a hard sell too.

The FairTax plan is attractive to many.
That is probably because it lends to the belief that you can control your taxes by controlling your consumption.
That’s true to some extent.
My house and cars are already paid-off, I have no debts, and don’t spend much money.
But, will the fairtax.org plan raise enough revenues?
That is difficult to prove.
However:

  • There are the necessities of life (food, shelter, medical, transporation, etc.).

  • The poor spend all of their income

  • The lower-to-middle-income groups spend most (or all) of their income

  • The middle-income groups spend most of their income

  • The poor and increasing number of middle-income groups can’t afford medical insurance, so a 30% (23% inclusive tax) on medical expenses would exacerbate that growing problem.

  • The wealthy don’t spend all of their income; a large part may be re-invested, but large sums of cash and money-market funds would still exsit; interest earned on that cash would not be taxed. Also, with such a high 30% (23% inclusive) sales tax, it might lead to less investment.

  • The hyper wealthy can’t possibly spend all their income; a large part may be re-invested, but large sums of cash and money-market funds would still exsit; earning tax-free interest. This could also have other economic ramifications to the money-supply.

In my opinion, the fairtax.org plan will let the wealthiest evade more taxes than ever before.

If the goal is to tax income fairly (as most people want), then why complicate it by trying to place the tax on sales (on the other end of the spectrum)? Also, we might end up with both a federal sales tax, and federal income taxes.

Here’s the plan I like :

  • It requires the least change.

  • It allows the easiest transition.

  • All that is required is a simplification of the existing system. Make it a flat 17% rate income tax, eliminate all the tax loop holes, and don’t tax anyone until their income exceeds the established poverty level.

  • It eliminates the loop holes.

  • It taxes incomes all the same 17% (over the poverty level).

  • It eliminates the graduated scale. 17% of $100K is double 17% of $50K. That is graduated enough.

  • It still allows for the accounting for Social Security and Medicare.

  • It won’t place high sales taxes on exports.

  • It eliminates corporate taxes.

Now, having said all that, think about this.
Why have any taxes at all?
After all, if the FED and government are going to print new money like crazy (89% of every new bank loan is new money), then why not print the money needed to run government too? Seriously, it would cut way down on the paper work and cost of calculating taxes, fines, etc. That way, everyone gets taxes the same amount by way of the inflation that money printing creates. Already the FED and government are printing about $181 Billion (on average) more money per year since 1950. M3 Money Supply increased from $150 Billion in 1950 to $10.15 Trillion in 2005 (a factor of 75 and double of the population now). We didn’t get 75 times richer since 1950. It sounds crazy, eh? But it is no crazier than what we have now.

Posted by: d.a.n at September 1, 2007 12:20 AM
Comment #231306

I thought of a big problem with this tax. Lets say I am 15 years old and I want to buy myself an Xbox360, retail price $399. I made the money for it cutting grass in my neighborhood, which at this age of course and this matter of making the money I would not have to pay any federal taxes. Well with the fair tax the 15 year old kid would be taxed $91.77 on their purchase.

Also think about what effect this tax will have on working and middle class people during the Christmas season! Usually under our current systems taxes are taken equally throughout the year. But since during the Christmas season most families, especially those with children, spend more than they do during other times of the year they will be hit especially hard during this season. Imagine it, a mom and dad of 3 telling their kids they could not get them the newest elmo whatever toy because the “fair tax” makes the Christmas season near impossible for lower and middle class families.

Posted by: Richard Rhodes at September 1, 2007 02:01 AM
Comment #231309

Rhinehold, before it was called the deceptive Fair Tax, it was referred to as a national sales tax. Calling it what it was got nowhere in terms of support. Hence, the deceptive name, Fair Tax.

Posted by: David R. Remer at September 1, 2007 04:15 AM
Comment #231310

Rhinehold asked: “They why wouldn’t they set their prices up by 23% now if they could get away with it?”

There are many ways to skin a taxpayer. No bid government contracts paying BILLIONS more than needed to fleecing organizations like Halliburton, KBR, CACI, BlackWater, and then those contracts to FEMA sub-contractors after Katrina. And yes, many do price goods beyond what can be charged and still profit. It is called tiered retailing, Wal-Mart at the bottom setting the minimum and Nieman Marcus near the top. Same T-Shirt, up to $50 difference in price - 250% markup. BUSTED!

Then there is the whole oil and gasoline cartel which has refinery difficulties timed to a T at the end of May, and resolved magically by the end of August. Then there is the whole automobile repair industry working hand in glove with designers to completely wipe out the backyard mechanic industry, and labor rates climbed from $20/hr just 20 years ago to the $70/hr commonplace rate today, a 350% increase.

Any introductory business course can give you the fundamentals and a search of Google for Oligopolies will give you the full picture. Our marketplace is full of oligopolies.

Posted by: David R. Remer at September 1, 2007 04:26 AM
Comment #231311

Rhinehold said: “In no way is there any plan, or desire, by the developers of the Fair Tax plan to eliminate SS.”

And if it were their plan, do you think they would admit it? Get REAL, Rhinehold. Government revenues underwrite Soc. Sec. and Medicare. These programs are facing trillions in deficit spending if revenues are not dramatically increased, as in a national sales tax rising to 50 cents per dollar spent. You think the public would stand for a 50 cent federal sales tax on top of their state tax of 8%, to salvage SS and Medicare on the backs of consumers? NO. ERGO, the end of SS and Medicare, which of course also spells the end of our economy since the only persons consuming after that will be the wealthy who got off almost entirely scott free with the UnFair Tax plan.

Hilarious that you think they would say their plan would spell the end of SS and Medicare. But, as I just outlined, it would. It puts the Middle Class in a vice with sales taxes on one side and loss of retirement and health care safety nets on the other. This plan benefits the wealthy only when taken out over the next 30 years. Everyone else it punishes brutally with immense suffering and horrible choices, as the wealthy are insulated and sheltered against sharing the burden coming, in every way possible.

These are logical deductions based on real world facts and scenarios, and though the deductions are scary, because they are logical extensions of facts presented, they can hardly be called scare tactics. Call them warnings. For that is what my comments factually are.

But, I always know when a person’s stand is eroding beneath them when they start attributing negative remarks to to the message without disproving the logic or facts being offered.

Posted by: David R. Remer at September 1, 2007 04:35 AM
Comment #231319

My attitude on this is, “please stop them before they wreak something else.”

The Republicans are too willing to make radical changes, and not willing enough to work out what the consequences of those changes will be. They assume, generally, that they will be positive, perhaps with some troubles to start. Unfortunately, as the last thirty years has demonstrated, the results have not been positive for the average American, nor for our government’s ability to do the job the people ask of it.

Posted by: Stephen Daugherty at September 1, 2007 08:49 AM
Comment #231322
I thought of a big problem with this tax. Lets say I am 15 years old and I want to buy myself an Xbox360, retail price $399. I made the money for it cutting grass in my neighborhood, which at this age of course and this matter of making the money I would not have to pay any federal taxes. Well with the fair tax the 15 year old kid would be taxed $91.77 on their purchase.

No, Richard, you miss the point entirely. You are talking about what the xbox would cost if we added a sales tax WITHOUT removing the income tax.

Each xbox has in it’s price the income taxes that are paid for through every step of the design, building, marketing, shipping and stocking of the xboxes. If we remove these HIDDEN income taxes, the price of the product would drop by 23% as determined by studies by economists.

Now, let’s examine this. If we are worried about the poor paying taxes because they can’t afford it, if we wanted to eliminate all of the tax that they pay we couldn’t do it because of these HIDDEN taxes on each product. By taking these taxes out and applying them at the retail sale, everyone can see them. They are transparent and for lower income individuals we can either not tax them or give them their tax paid back each month and they will not be paying ANY tax any more. The same cannot be said of our current tax system as it is patently unfair to the lowest income citizens.

There is less transparency of sales taxes collected, versus income tax (especially if you consider the number of sales to the number of people with income). Less transparency will breed more corruption.

Dan, this is completely wrong. The Fair Tax plan is the most transparent plan possible. The ‘flat tax’ you are pushing will leave the hidden taxes on each product still there, meaning that each product or service you buy will have 23% of that price being those income taxes paid throughout the process of getting that product or service to market.

David, the amount of tax will be the same if we use the Fiar Tax plan or if we keep things the way they are. The amount brought in will not change. Here’s a thought, though, if we want to keep SS around under EITHER plan, why not cut spending a bit to allow us to pay for it? You know, quit spending money in Iraq, quit giving corporations tax breaks (that would no longer be part of the equation with the Fair Tax since we wouldn’t be depending on these taxes that someone in office would then lower), quit wasting money, quit double/tripple/quadruple taxing people, etc. You want to use fear to keep people away from embracing this plan, and you’re more than welcome to do so, but don’t try to suggest that you are above the neocons when they use Fear to further erode our rights or the progressives when they ensure we keep embracing forced charity as a national policy.

By your logic, btw, the current Democratic Congress is out to elminate SS because they aren’t raising taxes on everyone by 15% a year to pay for keeping the program solvent. In fact, didn’t they tell us a couple of years ago when Bush wanted to overhaul SS that there was no crisis and we were doing just fine? That there was no need to overhaul the system? They sure did use Fear to ensure that a rational debate on the topic didn’t occur. Much like you are attempting to do now.

Posted by: Rhinehold at September 1, 2007 09:29 AM
Comment #231323
This plan benefits the wealthy only when taken out over the next 30 years. Everyone else it punishes brutally with immense suffering and horrible choices, as the wealthy are insulated and sheltered against sharing the burden coming, in every way possible.

BTW, the I don’t think ANYONE in the Middle Class is depending up on SS for their retirement, that would be stupid and most Middle Class people are not that stupid. THey have their own retirement plans. Ones that will actually provide more than a 1% return on the money they put into the plan.

The rich are always going to be ‘insulated’ from bad times and government because they work to make it so. Specifically so. That is *WHY* most people work to become rich. The only way to TRY to combat that is to tax ONLY the rich, which would not provide the revenues to keep SS solvent and they would just make sure to pass that cost on to the Middle Class like they do now. You want to talk ‘facts and reality’ yet ignore these simple facts of life whenever you talk about taking wealth from those who have it and giving it to those who don’t…

Posted by: Rhinehold at September 1, 2007 09:37 AM
Comment #231325

Let me see if I understand this. Somehow the government would have to know my income level for this to work as advertised. Then, based on this, they would assign me an arbitrary “consumption allowance”. So, if I spend more than this allowance, I lose money I should be getting back, if I spend less than this I gain money I don’t deserve. This is fair, how? Or would we have to save receipts and file for our “rebate” to prove what we spent?

And is this a “rebate” or “prebate”? I saw both terms used on the website. I can’t get my head around this as a fair or good idea.

Posted by: womanmarine at September 1, 2007 10:15 AM
Comment #231326

Isn’t this kind of “taxation without representation” that led to the American revolution? I am concerned that a retarded plan such as the “fair tax” plan will lead to a true tax payer revolt.

Posted by: studentlawman at September 1, 2007 10:17 AM
Comment #231329
I thought of a big problem with this tax. Lets say I am 15 years old and I want to buy myself an Xbox360, retail price $399. I made the money for it cutting grass in my neighborhood, which at this age of course and this matter of making the money I would not have to pay any federal taxes. Well with the fair tax the 15 year old kid would be taxed $91.77 on their purchase.
It’s worse than that. The FairTax on $399 is actually $119.70 for a total cost of $518.70. See how deceptive that is. It is dishonest in making people think in terms of a 23% sales tax when it is actually a 30% sales tax. The 23% comes from the ratio of the tax divided by the new total (tax + price).

Here’s another thing. Salaries must decrease. After all, salaries are raised to pay for income taxes. This is a little detail the FairTax proponents acknowledge, but fail to relate to others.

Hence, here are some PROs and CONs:

  • A Flat Income Tax Percentage Rate would be far easier to monitor far fewer (in number) incomes than billions of sales transactions in a FairTax system.

  • A Flat Income Tax Percentage Rate would be fairer than a FairTax system, because no sales tax system can prove that the tax burden will be evenly distributed (relative to income), and the middle-income-group may quite likely end up bearing most of the tax burden. After all, while some say the wealthy spend more, it has not been proven that the wealthy spend enough to ensure that they bear a fair portion of the tax burden (relative to income).

  • A Flat Income Tax Percentage Rate would would not require vast changes. One serious problem with a switch-over to a FairTax system is that many people have savings and retirements that they have already paid income tax on, and they would now have to also pay a new consumption sales tax when they spend it, which means they will be taxed twice.

  • A Flat Income Tax Percentage Rate would not require a reduction in salaries and incomes, which is essentially what would have to occur in a FairTax system, because the theory behind the consumption sales tax system is that everything would cost less. That is, the employers must cut employees wages, because no income taxes are being withheld, and the money has to come from somewhere. So, if your salary is $50K a year today, but you take home $40K after income taxes, there should be a savings of $10K, and it must come from reducing your salary by $10K to $40K. Theoretically, your take-home pay is the same as before, since you now keep 100% of your income.

  • Also, here’s a very interesting point. One question about any tax system that is continually asked is:
    Will everyone (excluding the poor) pay their fair (or equal) percentage of tax related to income ?
    Interesting isn’t it? What does that tell you? It seems many people still want the end result of any tax system to be that everyone pays their fair (or equal) percentage of income (excluding those below the poverty level, who don’t have it to pay anyway and would simply end up on welfare; possibly even quiting their jobs to collect welfare only).
    So, if we are continually tasked with proving that any tax system, in the end, must fairly tax income the same percentage (for all income above the poverty level), then why not simply retain the income tax, except greatly simplify it and make it a flat tax income tax rate of 17%, eliminate all loop-holes, deductions, subsidies, which will also mean little or no changes for accounting for Income tax, Social Security tax, and Medicare tax.

  • Lastly, do you really think incumbent politicians in Do-Nothing Congress are interested in a national sales tax because it fair? Please! Don’t make me laugh! The same Congress that now has an 18% approval rating? The same Congress that despicably fuels the partisan warfare. The same Congress that gives itself raise 9 of the last 10 years? The same Congress that ? The same Congress that despicably pits Americans and illegal aliens against each other and refuses to enforce existing laws (a free pass for their big-money-donors (i.e. illegal employers))? The same Congress that votes on pork-barrel, graft, and bridges to no where? The same Congress that refuses to eliminate tax loopholes that benefit the wealthy resulting in Warren Buffet paying less of a percentage of income tax than a secretary making $60K? Right.


My attitude on this is, “please stop them before they wreak something else.”
The Republicans are too willing to make radical changes, and not willing enough to work out what the consequences of those changes will be. They assume, generally, that they will be positive, perhaps with some troubles to start. Unfortunately, as the last thirty years has demonstrated, the results have not been positive for the average American, nor for our government’s ability to do the job the people ask of it.
What’s to worry about. The Democrat politicians will save us all and never allow such a thing to happen, or if it happens, continue to happen. Right?

Posted by: d.a.n at September 1, 2007 10:42 AM
Comment #231331

The “FairTax” is a clever plan to continue this trend.
Being wealthy is not a crime.
It’s not about envy and jealousy.
It is about fairness, and there is nothing fair about the “FairTax”.
The lower and middle-income groups spend most of their money, and will therefore pay most of the taxes as a percentage of their income (as the do now; must ask Warren Buffet who pays a lower percentage of income tax than a secretary making $60K per year since capital gains are only taxed at 15%; lower than the average income tax rate for most Americans).

Most Americans should be VERY suspicious of this “FairTax”.

Ask for the proof that the middle class won’t end up paying a higher percentage of their income to sales taxes. Good luck on getting an answer that can prove that. And the borderline poor will especially get hammered, since they most certainly will spend ALL of their income just to get by. That means ALL of their income is subject to tax since they have to spend all of it.

There is one thing the FairTax would accomplish perhaps, provided it isn’t circumvented by blackmarketsa and bartering: consumption

Posted by: d.a.n at September 1, 2007 11:09 AM
Comment #231332

trend

Posted by: d.a.n at September 1, 2007 11:11 AM
Comment #231337

Rhinehold said: “The rich are always going to be ‘insulated’ from bad times and government because they work to make it so.”

And you are paving the way to make it very, very, much more so. In case you hadn’t noticed the 800 lb. Gorilla in this debate, the wealthy do pay taxes under our current system, by far more than they will under the UnFair Tax plan. But, fortunately for America, after Jan. 2009, this plan won’t have a snowball’s chance in Hell of becoming a third coming of ‘Trickle Down’ economics, which is what this plan amounts to, in spades.

But, it is apparent from this debate, that offering you counter-point or critical analysis is pointless in terms of altering your purchase of the plan. Welcome to the land of Republicans, Rhinehold, for your comments paint a picture of a true believer, for whom logic, reason, and deduction have no meaning. I give you reality, you counter with proponent’s promises to trust them and their research, without ever bringing forth their research for examination.

It is obvious from your comment about the middle class, that you don’t even consider the growing numbers that will fall below that level with this UnFair Tax scheme. It is also plain from your comments that you personally resent being taxed, hence, you have a self-motivated interest in believing anything the proponents of the UnFair Tax plan say, regardless of how non-sensical and damaging to this nation it will be.

As I understand his work, Theory of Moral Sentiments, Adam Smith would call this unenlightened self-interest, for your interest fails to regard the enlightenment of moral sentiments regarding the fate of others falling on your actions. In other words, you aspire to be wealthy, and fail to contemplate how your beliefs would treat you if fates direct your experience in the other direction. It is the black hole into which the ‘glass is half full folks’ will not peer into, thus denying its existence, which can fuel its growth.

It is also sometimes called self-fulfilling prophesy, in which what one fears, one helps to bring about, given the refusal to acknowledge and act upon the premises creating the fear.

I thank you though for the debate to this point. It’s not our responsibility to convince each other, here at WatchBlog; it is a responsibility fulfilled if we explore the details, facts, and reason in each other’s points of view, and you have afforded us the opportunity to do that on this topic. Thank you.

Posted by: David R. Remer at September 1, 2007 12:05 PM
Comment #231338

D.a.n, quite right. I hereby dub this plan Gushing Up Economics, which is trickle down economics on steroids. The wealthy continue to aggregate ever more of the nation’s resources and the rest of the nation’s people serve them watching the nation’s problems and needs inexorably increase that .23 per dollar to 50 or 75 cents per dollar, crushing them into servitude and absence of choice in their lives regarding work, future, and hope for their children.

Given the moral conscience of so many wealthy philanthropists in our society, I would not be surprised to see a cadre of very wealthy persons come out adamantly against this plan, as it gains steam amongst the unquestioning grass roots Republican and Libertarian voters.

I find it fascinating that Republicans and Libertarians have been forced by unpopularity to share the same bed for comfort.

Posted by: David R. Remer at September 1, 2007 12:12 PM
Comment #231339

womanmarine, its a rebate. Here is the link to the UnFair Tax folk’s web site. It is to their FAQ page, where much of the details and deceptions are embedded. It is a master work of deception. These folks are needed by CountryWide to shore up its image after the sub-prime mortgage crisis they helped bring about.

Some of these folks boast of 30,000 supporters on one of their web pages. I am confident however, that number is growing rapidly in Iowa, as I type.

Posted by: David R. Remer at September 1, 2007 12:18 PM
Comment #231340

womanmarine astutely said: “Let me see if I understand this. Somehow the government would have to know my income level for this to work as advertised.”

Quite right. Hence, for all intents and purposes, the Congress must retain the IRS even if they call it by another name, the SSA for example as Rhinehold suggested. To set the rate to meet the nation’s needs, they must know the economic impact of raising the sales tax, and that will require knowing income levels for the population. Will they rely on business to report this information? Is there not a real conflict of interest for the working class in that? The potential is certainly there.

Posted by: David R. Remer at September 1, 2007 12:22 PM
Comment #231343

womanmarine,

It’s a PREBATE. You would receive it at the beginning of the month.

“Let me see if I understand this. Somehow the government would have to know my income level for this to work as advertised.”

No. Since the tax will be based on spending instead of income, there is no reason for the government to know your level of income in order to tax you.

I’m not going to try to convince you one way or other. I suggest you go to their website and read the plan as it is presented, check the links, and compute your taxes both ways.

Posted by: tomd at September 1, 2007 12:52 PM
Comment #231344

tomd, your reply is very naive. Read my previous comments to others. The government would indeed still need to collect income data. It would be absolutely essential to their budgeting and tax assessment processes. For all intents and purposes, the IRS does not go away, it just changes how it collects taxes from consumers.

You don’t seem to appreciate how integral to the government’s budgeting and tax rate setting functions the IRS data collection services are. The Federal Government literally could not function without an IRS, give it whatever name you will, it will still function as the IRS now does in providing indispensable economic and income data to the Congress.

Posted by: David R. Remer at September 1, 2007 12:57 PM
Comment #231345

tomd, no, in fact it is neither rebate or prebate in the sense that it will preimburse or reimburse for actual sales taxes incurred. The sales tax will be set at the same rate for all the 48 contiguous states and an allocation made “monthly” accordingly, regardless of cost of living differences in the various states. This is straight from the UnFair Tax web site.

I quoted monthly, because that won’t last. It is horribly inefficient and adds enormous cost to government rebates. Inevitably, as a spending reduction argued to save tax payers future increases, the government will have to move to annual disbursements, not monthly. The monthly is just to sell the plan. All kinds of modifications will occur if it is adopted.

Posted by: David R. Remer at September 1, 2007 01:02 PM
Comment #231346

“tomd, your reply is very naive.”

Not naive at all David. Read the bill AS IT IS PRESENTED HR25
“Read my previous comments to others.”

Read them Don’t agree with them.

“The government would indeed still need to collect income data. It would be absolutely essential to their budgeting and tax assessment processes. For all intents and purposes, the IRS does not go away, it just changes how it collects taxes from consumers.”

Not according to the way it is presented to congress in HR25.

“You don’t seem to appreciate how integral to the government’s budgeting and tax rate setting functions the IRS data collection services are. The Federal Government literally could not function without an IRS, give it whatever name you will, it will still function as the IRS now does in providing indispensable economic and income data to the Congress.”

You don’t seem to apreciate that taxes won’t be based on INCOME anymore, so INCOME data won’t be needed to set budgeting and tax rate setting.

This article REALLY shows your agenda to soak the rich.

Posted by: tomd at September 1, 2007 01:10 PM
Comment #231347
No. Since the tax will be based on spending instead of income, there is no reason for the government to know your level of income in order to tax you.

So, it’s based on spending? How do they know how much I spent? From looking at the website, it’s an arbitrary amount the someone somewhere estimates? And you call this fair? What happened to an actual, realistic amount? This is bullshit. And I do not believe that there will not be those folks with much political clout that will shape and bend this to their advantage, which has been done so often in the past.

Posted by: womanmarine at September 1, 2007 01:12 PM
Comment #231348
This article REALLY shows your agenda to soak the rich.

This is just uncalled for. And you hope to persuade folks to your side on this?

Posted by: womanmarine at September 1, 2007 01:17 PM
Comment #231349

From the website:

Retail prices no longer hide corporate taxes or their compliance costs, which drive up costs for those who can least afford to pay.

How can you prove that this will actually happen? Is it in the law somewhere?

Posted by: womanmarine at September 1, 2007 01:19 PM
Comment #231352

Yes, I also suggest people read the FairTax plan very carefully.
Then ask yourself:

  • why politicians (in a Congress with an 18% approval rating) are pushing for it?

  • Who are the politicians working for (you, or their big-money-donors)?

  • What group will pay the highest percentage of their income to sales tax?

  • Why do they call it a 23% tax when it is actually a 30% sales tax? As we see above, some are already fooled into calculating a smaller sales tax.

  • Won’t incomes have fall since there would no longer be income tax?

  • Which is easier to enforce: millions of incomes or Billions of sales transactions?

  • Won’t such a high 30% sales tax will create blackmarkets?

  • Is it really fair?

  • With a 30% sales tax, and with the borderline poor and middle income groups spending most (or all) of their income, who will pay the most sales tax as a percentage of income?

  • How will this eliminate the IRS? It will simply change roles from enforcing income tax laws to enforcing sales tax laws. So instead of the IRS, it’s now called the STRS (Sales Tax Revenue Service). Blackmarkets already exist. The FairTax will make them worse.

  • Why doesn’t the Do-Nothing Congress just simplify the current tax system and implement a flat rate 17% income tax? Perhaps because the like the perverted tax system and all the tax loop holes? Who do these tax loop holes benefit the most?

  • Who will a national sales tax benefit most?

  • What about all the money people have already paid income tax on? When they go to spend it, they will now pay an additional 30% sales tax … getting double taxed. OUCH!

So yes … please read the FairTax plan with those questions in mind. You should be suspicious in this era of growing disparity, and the growing trend of taxes cuts for the very wealthy. It’s not a crime to be wealthy and it’s not about envy and jealousy. It’s about fair taxation and I do not think the FairTax is even remotely fair. I think it will widen the disparity and allow the very wealthy to avoid paying an equal percentage of income to taxes.

If a person does not believe fair taxation is an equal percentage of income, then it is quite understandable why that person favors the FairTax (I abhor to call it that, since it really isn’t fair in my opinion). Here’s a better tax system that only requires simplifications to the currently over-complicated and abused system.

Regarding corporate taxes. Those taxes are simply passed onto consumers. It is an unnecessary over-complication. This is not a free pass for corporations to pollute, use, and abuse the environment and nation’s resources. Corporations should bear the costs and penalties for all damages they cause and tax payers should no longer pick up the bill for corporations that cause pollution and harm. Taxes are not the proper method to make corporations accountable. Steep fines, jail sentences, and law enforcement is the way to deal with corporate abuses. Also, perks to employees from corporations is a form of income and must be taxed. Otherwise, the CEOs and wealthy will simply live off the perks of the corporations. Again, this is a law enforcement issue that shouldn’t be addressed with taxes on corporations that simply get passed on to consumers.

Posted by: d.a.n at September 1, 2007 01:37 PM
Comment #231353

Rhinehold

A sales tax is also more stable in revenue than an income tax that goes up and down wildly as the economy rises and falls, while people still need to purchase things during the lean times and the good.

Then why is it that when the economy is down that states report a drop in sales tax revenue? And a lot of times deficits?
While folks do keep buying essentials during good times and bad, when things tight folks quit buying the big ticket items like cars, boats, stereos, etc. And they don’t spend as much (they look for the bargains)on essentials. This causes losses in sales tax revenues and has caused deficits for states and counties that rely heavily on sales tax revenues for a large part of their budgets.
What makes ya think it would be different with a federal sales tax?

Posted by: Ron Brown at September 1, 2007 01:41 PM
Comment #231354

tomd said: “You don’t seem to apreciate that taxes won’t be based on INCOME anymore, so INCOME data won’t be needed to set budgeting and tax rate setting.”

Not the issue. You don’t appreciate the fact that Congress MUST deliberate the effects on families and workers of spending and tax policy, which CANNOT be ascertained without the income data the IRS now provides.

Or, are you advocating Congress make such decisions without that data to determine who in society will be most impacted, and that they just make such decisions without care as to whom it affects?

Your comment’s logic is seriously flawed.

Posted by: David R. Remer at September 1, 2007 01:45 PM
Comment #231357

womanmarine,

“So, it’s based on spending?

Yep.

“How do they know how much I spent?

If you are talking about the prebate, It doesn’t matter. It is based on the poverty level. As I understand it, you, I and everyone else in the USA would get a check at the beginning of each month equal to 23% of the level of poverty. If you are speaking of the tax itself, it still doesn’t matter. It will be collected as you make a purchase.

“From looking at the website, it’s an arbitrary amount the someone somewhere estimates?”

I think I answered this above.

“And you call this fair?”

As fair as we can be and still be compassionate.

“What happened to an actual, realistic amount?”

It’s not hard to figure an actual, realistic amount when it’s based this way.

“This is bullshit.”

Have you computed your taxes both ways? It’s not bullshit if it saves me money.

“And I do not believe that there will not be those folks with much political clout that will shape and bend this to their advantage, which has been done so often in the past.”

It’s been done so often in the past because a tax system based on income is ripe for corruption thru deductions and earmrks that are mostly hidden from us. Both parties do this. It would be MUCH harder to shape this law where a flat 23% tax is collected at point of sale with no exemptions.

“From the website:

Retail prices no longer hide corporate taxes or their compliance costs, which drive up costs for those who can least afford to pay.
How can you prove that this will actually happen? Is it in the law somewhere”

They are speaking of the corporate income taxes that are added to the price of everything you buy, and the cost of CPAs to stay in compliance with the tax laws. All of these costs would go away with the FairTax because there would be no income tax laws to comply with nor any corporate income taxes to add to the price.

It IS in the law as proposed.

I would suggest you read it. You might actually like it.


Posted by: tomd at September 1, 2007 01:53 PM
Comment #231358

The Fair Tax numbers are given, typically, at 23%. The reason for this is not that this number creates revenue neutrality, but because it’s the cut-off point past which support for this tax drops through the floor.

The Right has a problem, whether Republican or not: it has an elitist attitude towards the rest of the population. Whether it’s the religious right, which believes they’re morally superior, the Neocons, who believe that their resolve to defend the country is superior, or the Paleocons, who believe that their sense of economics is superior, and that those who gain power deserve it because of inherently greater worth demonstrated by success, there is a pervasive attitude among the Republicans and the right that they have to right to do just about anything to see their agenda fulfilled.

This has made them bolder than the Democrats, but also more destructive. This fair tax chicanery is just one more example of where folks are lied to in order to get their support for policy they’d otherwise object to.

Americans would not support the fair or the flat tax at the rates that would be required to maintain revenue neutrality. It would not be a mere inconvenience if revenue neutrality were not upheld, it would be catastrophic. Those on the right naively believe that government will shrink to fit the lowered revenue. It never has before, and it wouldn’t now. Instead, one of two things would happen: an explosion of debt or inflation, or a cruel increase in tax rates on every American.

The Democrats aren’t perfect. The sixties were ours to mess up and we did. Republicans got plenty of mileage off of that. But in taking reins from us, they have repeated our mistakes, instead of learning from them.

The truth of the matter is, people have gotten very idea-rich since the sixties, and very execution-poor. Getting things working and working well has taken a backseat to a bunch of disorganized political agenda items intended to burnish images, and fulfill abstract political wishes. Folks have lost the concern for basic governance, and instead try to use the government for wish fulfillment.

There’s nothing wrong with the government supporting the sciences or the arts, nor programs meant to aid people in their time of need. But priorities must be arranged, and we must be much more cognizant about what we do, much more watchful of the results. What we need is not big government or small, but an working government that most Americans are willing to live with. Same thing with taxes. We don’t need high taxes or low taxes, rather we nee taxes which pay for what we want out of government, and what we’re willing to spend. If Americans are willing to accept higher taxes for the sake of national healthcare, then so be it. But we must approach it, and any other government endeavor with a mature and prudent attitude towards the costs and the management of the programs we desire.

There is a huge difference between the worlds we desire and the worlds we can manage to create. The time has come for America to once again focus on making good government, bought with today’s revenues, rather than continue to try and get something for nothing.

Posted by: Stephen Daugherty at September 1, 2007 01:54 PM
Comment #231360
This article REALLY shows your agenda to soak the rich.
This reminds me very much of the amnesty proponents. If you disagree, and want illegal immigration laws enforce, you are a racist. It is an encouraging sign, because that is what happens when the debate is being lost.

The real difference is revealed by this statement:

You don’t seem to apreciate that taxes won’t be based on INCOME …anymore

Precisely. There are three groups:

  • (1) Some believe that people should pay an equal percentage of income to taxes (most Americans prefer this method).

  • (2) Some believe that people should pay an equal percentage on spending (consumption; i.e. a sales tax).

  • (3) Some believe that people should pay an increasing percentage to taxes as their income increases.
  • Now, since the borderline poor, and the lower-to-middle income groups spend almost all of their income to get by, and the wealthy aren’t even remotely likely to spend all of their vast income, who do you think will pay the largest percentage of their income to taxes?

    To me, (2) and (3) are not fair. Not even remotely. Most Americans (including me) believe in (1), a flat rate percentage on income as being the most fair method (i.e. (2)). This is made even more fair and efficient by not taxing ANYONE on income below the poverty level, since those people would simply end up receiving welfare, increasing costs to all taxpayers due to the unnecessary red tape and paper work. Instead of a pre-bate, simply do not tax any income below the poverty level.
    Method (2) would most likely heap the majority of taxes onto those who must spend most of their income just to get by.
    Method (3) is the only method that could possibly be viewed as “soaking the rich” (i.e. jealousy and envy disguised as demands for equality). Methid (3) is the system we would have now if it were not for the myriad of tax loop holes that allow the wealthy to avoid taxation (as evidenced by Warren Buffet who pays a lower percentage of income to tax than a secretary that makes $60K annually).

    The current tax system could be fixed if Congress was serious about real reform. Unfortunately, Congress is extremely corrupt, FOR-SALE, and greedy as evidenced by decades of fraud, corruption, waste, crimes, arrogance, incompetence, and fiscal irresponsibility. But voters deserve some of the responsibility for that too, since most voters repeatedly re-elect and reward those same incumbent politicians with 90% to 95% re-election rates.

    Posted by: d.a.n at September 1, 2007 02:09 PM
    Comment #231361

    “”tomd said: “You don’t seem to apreciate that taxes won’t be based on INCOME anymore, so INCOME data won’t be needed to set budgeting and tax rate setting.”

    Not the issue.”

    You brought it up as the issue. “”You don’t seem to appreciate how integral to the government’s budgeting and tax rate setting functions the IRS data collection services are. The Federal Government literally could not function without an IRS, give it whatever name you will, it will still function as the IRS now does in providing indispensable economic and income data to the Congress.” I quoted your entire paragraph so as to not take tou out of context.

    “You don’t appreciate the fact that Congress MUST deliberate the effects on families and workers of spending and tax policy, which CANNOT be ascertained without the income data the IRS now provides.”

    You are correct. I don’t appreciate the above sentence. I don’t even understand it.

    “Or, are you advocating Congress make such decisions without that data to determine who in society will be most impacted, and that they just make such decisions without care as to whom it affects?”

    There are other ways for the government to collect data. I don’t understand why they would need to know how much I make.

    “Your comment’s logic is seriously flawed.”

    Point them out as I have with your agenda to soak the rich.

    Posted by: tomd at September 1, 2007 02:09 PM
    Comment #231362


    Isn’t a national sales tax good for the nation because the poor will be spending almost all of their income on taxable items, the middle class will be spending most of it’s income on taxable items and the wealthy will be spending a fraction of their income on taxable items?

    Why do we want to bother with rebates to poor people? Anyone can get rich in America. If you are not rich, you are not working hard enough or your not working smart enough.

    Just imagine if everyone worked hard enough, smart enough and everyone was rich. Wouldn’t that be wonderful? We could all afford luxury items like bread and milk.

    Posted by: jlw at September 1, 2007 02:11 PM
    Comment #231364

    I much prefer a flat tax, as long as it’s based on ALL forms of income (in other words, money that you get, including dividends, inheritance, etc). That is to include corporate profits and stock earnings.

    Take the employers out of it, let them only report all income and let folks pay their own taxes, medicare, SS, healthcare (or have universal healthcare) themselves.

    No deductions. It would be straightforward and easy with no question.

    That someone somewhere would decide what my “consumption allowance” should be is abhorrent to me.

    Posted by: womanmarine at September 1, 2007 02:21 PM
    Comment #231365

    David:

    I salute you for a good, accurate and fair discussion of the so-called “fair tax.”

    The “fair tax” is the greatest scam ever proliferated by the GOP - even worse than the “Social Security Privatization” fraud. It is not fair. It is not conservative. It hurts family values. It helps only one group: the wealthy.

    But then, the wealthy are the one group the GOP has been working for during this Republican Administration.

    All income should be treated alike. Different rates for capital gains is the basis for loopholes. Get rid of the loopholes and ordinary taxpayers will get a tax decrease.

    Posted by: Paul Siegel at September 1, 2007 02:30 PM
    Comment #231368

    Paul, thanks.

    womanmarine, we are of like mind on your approach, with only minor differences.

    jlw, quite right. The great American Dream used to be a good job, decent home in a nice neighborhood for the kids, and a retirement to look forward to at the end of one’s life to reflect in. Now, the great American dream (for proponents of this sales tax plan) is for everyone to aspire to be a Vanderbilt, and if they fail to do so, they weren’t deserving of anything above servitude to inconspicuous consumption, government taxes, and the wealthy, in the first place.

    Posted by: David R. Remer at September 1, 2007 03:19 PM
    Comment #231370

    David:

    I admit that my preference is simplistic, how are we different? I’m very interested.

    Posted by: womanmarine at September 1, 2007 03:26 PM
    Comment #231373

    Oh, and yeah, what is to prevent in this age of internet international sales, Americans from simply purchasing products overseas and avoid the sales tax altogether. Certainly sounds like rational strategy for the wealthy and not so wealthy to dodge 10’s of billions in sales taxes by purchasing direct from international suppliers, some of whom will be America corporations overseas.

    Why buy an HP computer here, when you can just as easily order one from Fujitsu online and have it direct shipped, bypassing middlemen costs, and sales taxes. That would be the future of consumerism under a national sales tax plan - a bankrupt government followed by a failed domestic economy. Like it or not, America’s economy is inextricably linked to the health of the federal government.

    If government fails, so, does the American economy, via failed infrastructure, safety nets which, sustain broad based consumerism, which is 2/3 of our economy, and failed economic stimulus in recessions or bubble bursting as a result of not being able to finance any more debt on the open international market.

    Posted by: David R. Remer at September 1, 2007 03:34 PM
    Comment #231377

    womanmarine

    “I much prefer a flat tax, as long as it’s based on ALL forms of income (in other words, money that you get, including dividends, inheritance, etc). That is to include corporate profits and stock earnings.”

    as a conservative i couldn’t agree more. taxing ALL income at one flat rate would be a much more fair. if we did this there would be no need for the punitive tax system we now have, i would also be ok with exempting the first say 25k ( just a # off the top of my head) as to give lower income people a break. the actual deduction would have to be calculated of course.

    Posted by: dbs at September 1, 2007 03:44 PM
    Comment #231379

    womanmarine, I would exempt transfer payments from flat taxation. It is redundant and inefficient to hand out a Social Security check and then incur the bureaucracy to collect taxes on that check as income a year later. It is the one and only form of income I would exempt from a flat tax.

    Those living at or below the poverty line, would still have to file, but, taxation should not increase the very poverty government revenues are spent on trying to eradicate. Self-defeating.

    You said: “Take the employers out of it, let them only report all income and let folks pay their own taxes, medicare, SS, healthcare (or have universal healthcare) themselves.”

    I like the idea of taking employers out of it requiring they continue to report income at first glance. But, the idea of employers not collecting flat taxes from paychecks, is what I am undecided over. Payroll taxes assist a hundred million Americans in budgeting the payment of their taxes over the year, minimizing the impact on their budgets in one fell swoop.

    If government tries to collect a year’s worth of flat tax from workers due on a specific date, I fear there will an enormous increase in defaults. In turn there would be consequences to force payment. And I have to wonder if that does not open the door for debtor’s prisons; something the colonialists fought for independence over.

    If another cost effective and efficient method for collection could be devised in which citizens could pay directly but, on a monthly basis, I will rest more comfortably with removing employers and investment companies from the collection loop.

    Posted by: David R. Remer at September 1, 2007 03:48 PM
    Comment #231380

    dbs, spoken like a true traditional conservative seeking fairness, efficiency, compassion for others, and shared responsibility. Count me in.

    Posted by: David R. Remer at September 1, 2007 03:52 PM
    Comment #231381

    “Oh, and yeah, what is to prevent in this age of internet international sales, Americans from simply purchasing products overseas and avoid the sales tax altogether. Certainly sounds like rational strategy for the wealthy and not so wealthy to dodge 10’s of billions in sales taxes by purchasing direct from international suppliers, some of whom will be America corporations overseas.”


    Why buy an HP computer here, when you can just as easily order one from Fujitsu online and have it direct shipped, bypassing middlemen costs, and sales taxes. That would be the future of consumerism under a national sales tax plan -

    I think a more likely scenereo would be a lot of foreign companies wanting to move here for the tax benefits we would offer.

    “a bankrupt government followed by a failed domestic economy. Like it or not, America’s economy is inextricably linked to the health of the federal government.”

    I think the FairTax plan would be a tremendous boost for our economy.

    “If government fails, so, does the American economy, via failed infrastructure, safety nets which, sustain broad based consumerism, which is 2/3 of our economy, and failed economic stimulus in recessions or bubble bursting as a result of not being able to finance any more debt on the open international market.”

    Scare tactics?

    Posted by: tomd at September 1, 2007 03:54 PM
    Comment #231384


    tomd: If we could bypass the tax law and buy direct from overseas suppliers why would they want to come here? We still have labor, workplace safety, product safety and environmental laws which some claim has crippled American business making it almost impossible to make a profit.

    If the government were to enact this tax as law. I guarantee you that they will make it virtually impossible for all but the more affluent to buy direct from overseas without paying the tax.

    Posted by: jlw at September 1, 2007 04:11 PM
    Comment #231386

    David:

    womanmarine, I would exempt transfer payments from flat taxation. It is redundant and inefficient to hand out a Social Security check and then incur the bureaucracy to collect taxes on that check as income a year later. It is the one and only form of income I would exempt from a flat tax.

    Those living at or below the poverty line, would still have to file, but, taxation should not increase the very poverty government revenues are spent on trying to eradicate. Self-defeating.

    Actually, I agree with these. And if employers did deduct the taxes and pay the government, that would actually lessen the mind-boggling tax forms for everyone. So I think we agree much more than we might disagree. My post above was just off the top of my head. I’m a firm believer in KISS.

    Posted by: womanmarine at September 1, 2007 04:18 PM
    Comment #231387
    I think a more likely scenereo would be a lot of foreign companies wanting to move here for the tax benefits we would offer.

    By the time this occurred, the government would be broke. And why move their business here when their foreign business (from the US) would increase exponentially.

    Posted by: womanmarine at September 1, 2007 04:19 PM
    Comment #231393

    this has been a thoroughly informative discussion, and i thank you for it. i was for the fair tax, though,admittedly, i hadn’t spent much time researching it. i’ve merely glanced at fairtax.org in the past, and you must admit that it sounds good ‘on paper.’

    nevertheless, given this discussion, i’m currently leaning toward what appears to be the majority view in this blog. it’s looking increasingly like this fair tax is some “no dollar left behind” neoconjob.

    again, thanks for the informative debate. d.a.n., david, womanmarine - i should like to hear more on where exactly it is that your positions diverge… but perhaps another time.

    by the by,

    “…or the Paleocons, who believe that their sense of economics is superior…”

    another undeserved slam at true conservatives. remember, it was the reagan years whence the american neocon movement was essentially birthed, with ‘democrats for reagan.’ i don’t think you can fairly blame conservative ideology for lending a partial foundation to that of the neocon. after all, the neocons adopted the worst of liberal ideology as well.

    neocon is the ill-conceived bastard child of two well-intentioned ideologies, hijacked by the wealthiest of the wealthy as the mechanism of choice for world domination. or at least that’s my opinion.

    Posted by: diogenes at September 1, 2007 04:50 PM
    Comment #231396

    A flat 17% income tax only on all income above the poverty level would be enough to raise the revenue needed. That 17% could be reduced after most of the 77 million baby boomer bubble passes (e.g. to say 14% or less). However, time is running out due to debt, war, wealth disparity, a dishonest fiat-funny-money-system (see 47 minute video), fiscal irresponsibility, corruption, and government FOR-SALE.

    Unfortunately, real tax reform is as elusive as other as long as most voters repeatedly re-elect and reward the same irresponsible inbumbent politicians. Instead, there’s a real danger that Do-Nothing Congress will push through the HR25.

    Until voters care and the consequences provide the motivation for change, government is a reflection of the voters. An 18% approval rating for Congress is essentially an 18% approval of the voters.

    Wouldn’t that be wonderful? We could all afford luxury items like bread and milk.
    Funny! (in a sad way).

    diogenes,
    Thanks!

    You’re right. Being wealthy is not a crime. But allowing the wealthy to use and abuse their vast wealth and power to control and influence government and exploit the majority of the population is dangerous. The disparity has been growing in the U.S. since 1980. 1% of the population in 1980 had 20% of all wealth. Now, 1% of the U.S. population has 40% of all wealth.

  • 40% of all wealth is owned by 1% of the population.

  • 60% of all wealth is owned by 5% of the population.

  • 70% of all wealth is owned by 10% of the population.

  • 83% of all wealth is owned by 20% of the population.

  • 60% of the U.S. population has only 5% of all wealth.

  • 20% of the U.S. population has a negative net worth of $9,000.

  • 40% of the U.S. population has a net worth of only $2,000.
  • If we want the disparity to worsen, the “FairTax” is the ticket.

    Posted by: d.a.n at September 1, 2007 05:16 PM
    Comment #231400

    Stupid question here………what kind of effect, would this have for those of us in a State that doesn’t have a sales tax???

    Posted by: Sandra Davidson at September 1, 2007 05:34 PM
    Comment #231405

    Sandra

    “Stupid question here………what kind of effect, would this have for those of us in a State that doesn’t have a sales tax???”

    you’de still have no state sales tax, but there’d be a federal consumption( sales tax ) on the goods you bought.

    Posted by: dbs at September 1, 2007 05:42 PM
    Comment #231406

    Another aspect of this, there’s already a big business in stolen SS and welfare checks, imagine how this would escalate with everyone getting a check every month.

    And the prospect of identity theft makes this mind-boggling.

    And what’s the cost of sending out all these checks? Hell they can’t even always get the ones they send out now right.

    Posted by: womanmarine at September 1, 2007 05:45 PM
    Comment #231407

    Sandra:

    You would now have a sales tax. But no income tax, hip hip hooray!!

    Posted by: womanmarine at September 1, 2007 05:46 PM
    Comment #231410

    Thanks dbs and womanmarine……I think. I also think I’m getting too old for this s**t, as well as looking forward to status quo in this particular instance. Looks and sounds like this is one time when change is not necessarily a good thing.

    Posted by: Sandra Davidson at September 1, 2007 06:34 PM
    Comment #231415

    tomd, how can that statement be scare tactics. We are going to double our national debt in one decade. We are now experiencing the burst of bubble in sub-prime mortgaging. These are not scare tactics, tomd, they are happening RIGHT NOW!

    And contrary to neocon B.S., our government does have a borrowing limit, and serious incremental interest increases en route toward that limit. All that is needed to bring it on is the boomers retiring which too is an inescapable fact of reality.

    No! Not scare tactics. Reality!

    Posted by: David R. Remer at September 1, 2007 08:30 PM
    Comment #231416

    womanmarine, quite right. There appear to be no differences on our views. It’s a pleasure to engage a like minded person on at least one major issue. Gets lonely in this third party/independent column sometimes.

    Posted by: David R. Remer at September 1, 2007 08:33 PM
    Comment #231417

    diogenes, thank you for your comment. It has been a learning exercise for me as well, as I sought to understand the meaning of that Wa. Times article originally linked to in my article. A real eye opener.

    Posted by: David R. Remer at September 1, 2007 08:34 PM
    Comment #231422

    Okay, fair tax this and flat tax that … is federal income tax even legal in the first place? I’m only a half hour into this two hour film I found, but I had to pause so I could come here and share it with you people (who are mostly smarter than myself) to see what, if any, basis in fact it has. Yes, the problem with documentaries like this one is that they’re usually biased and longwindedly present one side of an arguement, but from what I’ve been able to fact check so far, it checks out.

    Here’s the video about the legality of the federal income tax. It is 1hr 51min long. Is there anyone here with the time and motivation to help check this thing out? I don’t know exactly how old it is, other than the post date of May 5 2007.

    It would seem to me that before we agree to reform the tax code, we should start at the beginning … IS federal income tax on wages and labor legal at all?

    Posted by: wtc7 at September 1, 2007 09:53 PM
    Comment #231426

    WTC7: I’m interested and going to watch the video. In the meantime, ponder this:

    How do we pay for our government and run our country without a tax of some kind? It needs some income to run and provide the services for the common good and defense. To me the income tax (a different one) still makes sense.

    Posted by: womanmarine at September 1, 2007 10:30 PM
    Comment #231429

    wtc7-
    The sixteenth amendment makes it legal to do a progressive income tax. Congress was also granted the constitutional power to collect taxes, which is what the sixteenth amendment modifies.

    It’s an argument made by those who want to sound like they have a legal argument, but not one supported by event the basic law.

    I think calling something unconstitutional has become the cheap method of trying to quickly turn people against something and paralyze defense. Rhetorically, though, it’s not worth spit, unless you’ve got the courts on your side.

    It’s also a way of avoiding more troublesome, less unambiguously persuasive arguments. Like I pointed out, nobody’s system among all these flat-tax and fair tax folks is actually revenue neutral. The percentage they give is one the experts told them was the maximum they could poll well on. Once again, it’s a case of people leaving out important but rhetorically inconvenient facts out.

    There was this one guy, way back in the argument that cited taxation without representation. I wonder whether this guy knows who his representative is in Congress? The whole point of that catchphrase is that the colonists were not afforded proper parliamentary representation, despite all the taxes that were about to be dumped on them. They wanted a say in things.

    Americans have their say now, if they’re not so intimidated by slow and uncertain results that they defer to the people elected by them and their community. The first step to having representatives that disregard your wishes, is letting them do so in the first place.

    I imagine a national sales tax would have roughly the same result as prohibition. People will want to pay for goods, but will not want to pay for them at the sales tax inflated prices. So, they’ll turn to grey and even black-markets, and that will encourage and crime and make it profitable.

    The thing to consider is that no taxation, flat, fair, or cherry-flavored, will be brought about without a government agency capable of enforcing the collections. Some anti-government types cheerfully state that these new proposals will break that power, but from what I see, it’ll only shift it around.

    This is about perceived control of one’s life, not good government policy. This is the idea that there’s no price to having a tax revolt, a war, and increases in homeland security at the same time. Things simply do not work that way. Political ideals cannot make bad policy work, it can only convince folks too deeply invested in it to continue to invest in it, without regards to decent results.

    Posted by: Stephen Daugherty at September 1, 2007 11:29 PM
    Comment #231430
    And contrary to neocon B.S., our government does have a borrowing limit…

    And what, pray tell, is the neocon position on tax policy and government borrowing? Please enlighten me. As a traditional Republican and conservative, I have my gripes about some facets of neoconservative foreign policy ideas (which is the only place where their influence is felt), but comments like this are utter nonsense and smack of scapegoating. Who are the neocons? Almost to a man (or woman), Jewish socially liberal foreign policy hawks. Please lets not go down the road of accusing the “Jewish problem” of everything we don’t like in the world whether or not those things have anything to do with them or not. Be specific about who you’re complaining out and don’t start scapegoating unrelated groups like this. Honestly.

    Posted by: Loyal Opposition at September 1, 2007 11:39 PM
    Comment #231432

    womanmarine

    I much prefer a flat tax, as long as it’s based on ALL forms of income (in other words, money that you get, including dividends, inheritance, etc).

    A fair flat tax would include all forms of income a person has and would be across the board regardless of income level. It would be taxed all income the same rate for everyone with absolutely no deductions.
    This insures that the rich pay taxes as well as the middle class and the poor. As it is right now only the middle class is paying as the rich have all the loopholes and the poor are given tax credits.
    The only problem is getting a flat tax passed with the current crop of politicians we have up there in DC. The Democrats want to punish the rich. And the Republicans want to punish the middle class.

    wtc7
    Amendment XVI of The United States Constitution,
    Adopted 1913:

    The Congress shall have the power to lay and collect taxes in incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

    It would seem that not only is income tax legal, but it’s also Constitutional.

    Posted by: Ron Brown at September 1, 2007 11:50 PM
    Comment #231437

    womanmarine,

    That’s right. Government can not operate with out any (or insufficient) funds.

    And it wouldn’t surprise me one bit that three fourths of the states may have never actually ratified the 16th Amendment:

      Amendment XVI: The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.

      After all, Congress has been ignoring Article V of the Constitution for many decades, despite 567 requests to make amendments by ALL 50 states. All but three of the applications were made between 1900 and 1992, and over half were made between 1960 and 1992. How many amendments does it take? Clearly, Congress has a conflict of interest. But, the voters allow it.

      At any rate, how can we improve the tax system? The current average income tax rate is about 21%.
      However, a 17% flat rate income tax (no tax loop holes, no caps, no tax on income below the poverty level) is sufficent. Why? Two main reasons:

      • (1)The wealthy will finally pay their fair share

      • (2)Because 17% of the current $13.5 Trillion GDP is $2.3 Trillion, which is enough to run the government with only minor cuts in total federal spending (about the amount of one year of pork-barrel, waste, and the billions the Pentagon can account for).

      Unfortunately, this entire discussion is an exercise in futility as long as most voters continue to repeatedly re-elect and reward the same irresponsible incumbent politicians (with 90% to 95% re-election rates) that continually refuse to address dozens of reforms (e.g. tax reform, campaign finance reform, monetary reform, violations of the Constitution, violation of Article V of the Constitution, election reform, $12.8 Trillion of Social Security debt, $9 Trillion National Debt, $20 Trillion nation-wide debt, widening disparity, massive gouging by the medical industry and insurance companies (not to mention killing 195,000 annually due to preventable medical accidents; 106,000 of those from Adverse Drug Reactions), illegal immigration, pork-barrel, graft, waste, corruption, government FOR-SALE, and Do-Nothing Congress that ignores all of it year after year).

      And the banking/money system is extremely dishonest. Have you ever wondered:

      • Why doesn’t the FED ever talk about debt. Perhaps because the FED is largely behind most of it?

      • Why do we accept 3% to 4% (or more) inflation as normal?

        • Why, now in 2007, is:
        • a 1997 dollar now worth only 77 cents?

        • a 1987 dollar now worth only 55 cents?

        • a 1967 dollar now worth only 29 cents?

        • a 1957 dollar now worth only 16 cents?

        • a 1947 dollar now worth only 11 cents?

        • a 1937 dollar now worth only 07 cents?

        • a 1927 dollar now worth only 08 cents?

        • a 1913 dollar now worth only 05 cents?
      • Why so many foreclosures now if everything is so rosy?

      • Why so many credit card applications in the mail?

      • Why is 89% of every new bank loan new money invented out of thin air (see 47 minute video; you’ll be amazed) ?

      • Why is it the bank can earn interest on money printed out of thin air?

      • Why did the FED just print and pump $38 billion into the banks (liquidity, eh?) in Aug-2007 ?

      • Isn’t it astounding how everyone can be in debt to bankers?

      • How can everyone that produces the wealth be in debt to banks?

      • Why is there $10.15 Trillion of M3 Money Supply in year 2005 when it was only $150 Billion (75.2 times less) in year 1950 (and that’s with double the population now)?

      • How can everyone be in debt to banks, when 89% of the money is printed out of thin air?

      • Most people think banks are loaning out money from deposits.

      • Where will the interest for all the debt come from when the money for that much interest does not even exist yet? Yes, you know where? It will be printed out of thin air.

      • Why is the government spending money like crazy when we already have so much federal debt ($9 Trillion National Debt and Social Security is $12.8 Trillion in debt)?

      A fair flat tax would include all forms of income a person has and would be across the board regardless of income level. It would be taxed all income the same rate for everyone with absolutely no deductions. This insures that the rich pay taxes as well as the middle class and the poor. As it is right now only the middle class is paying as the rich have all the loopholes and the poor are given tax credits.
      The flat 17% income tax system (no tax loopholes, no deducitons, all forms of income are taxed at an equal rate) has a poverty level exemption that applies to all people (rich or poor). Thus, there are no favorites. Above the poverty level, everyone is taxed the same percentage. NOTE: Neither the rich, poor, or middle-class … that is, no one pays tax on the income below the poverty level. The reason for the poverty level starting point at which income begins to be taxed is because taxing incomes already below the poverty level simply drives the poor onto welfare and costs all the tax payers more in paperwork, red tape, etc. Also, if you were to tax the income below the poverty level, it wouldn’t amount to much. It’s not worth doing for several reasons.
    • Posted by: d.a.n at September 2, 2007 12:25 AM
      Comment #231438


      It has gotten to the point where there is virtually no separation between economics, foreign policy and military actions. This is what the neocons have done, to make them so intertwined that we are prevented from doing anything except what the want.

      They aren’t about to pull out of Iraq before they get the oil bill passed and the ink is dried on the contracts. If we force them to start withdrawing, well you have heard their threats.

      The oil industry is backing them 100% and the oil companies would love a flat tax and a national sales tax even better.

      Posted by: jlw at September 2, 2007 12:29 AM
      Comment #231439
      , nobody’s system among all these flat-tax and fair tax folks is actually revenue neutral.

      Stephen, I think you know better than that, but if not:

      One of the leading economists supporting the FairTax is Dr. Laurence Kotlikoff of Boston University. A detailed 2006 study published in Tax Notes by Beacon Hill Institute at Suffolk University and Dr. Kotlikoff concluded the FairTax would be revenue-neutral for the tax year 2007 at a rate of 23.82% (31.27% tax-exclusive). The Argus Group and Arduin, Laffer & Moore Econometrics each published an analysis that defended the 23% rate.

      Here’s the problem that everyone is missing. We wouldn’t be paying MORE under this plan, we are already paying these taxes. They would just not be coming out of our income and hidden in each and every good and service we purchase now. Instead they would be visible for everyone to see.

      To suggest that the elimination of the income tax and the addition of the sales tax would cause people to ‘riot’ is precisely the issue. They don’t know because we HIDE it from them.

      And no one, at least not that I’ve read yet, on this blog will debate the issue that right now our poor are paying hidden taxes on necessities. The Fair Tax plan ensures that they no longer do. No other plan, not the flat tax or the current progressive tax plan in place now, can say the same thing because they both continue to hide the taxes that we pay in the price of every good we buy.

      Posted by: Rhinehold at September 2, 2007 12:30 AM
      Comment #231443
      Then why is it that when the economy is down that states report a drop in sales tax revenue? And a lot of times deficits?

      Usually bad management at the state level I would gather. This is from http://www.fairtax.org/site/PageServer?pagename=about_faq_answers where the diagram exists. (#9)

      Is consumption a reliable source of revenue?

      Yes, in fact, consumption is a more stable source of revenue than income. A recent study by American Farm Bureau economist Ross Korves shows the FairTax base is less variable than the income tax base. Why? Because during difficult times due to loss of a job or an inability to work, people may not have as much income, or may have no income at all. They borrow funds or use savings. They may not have earnings, but they still continue to consume. Figure 3 below shows the yearly changes in the tax base, adjusted gross income (AGI) under the current tax system for 1974-2004 and changes in personal consumption expenditures (PCE) of the same time period.

      BTW, I find it funny that David will accuse me of not ‘presenting the research’ when I have and have pointed him to the links several times in the past but all he counters with is ‘it will eliminate SS’ and finally, in a past discussion, admitted that the main support of the progressive plan we have now is that it removes wealth from those who have it and gives it to those who don’t. That’s it. That is why he objects to this plan because it removes the ability for him to support candidates that promise to manipulate the tax code to this end. There would be no more manipulating the tax code, which he says the IRS would be needed for. The fact that we WON’T be doing that anymore means that we won’t need even that function of the IRS.

      I do not tell the government how much I make and to be honest I don’t see how it is any of their business. I also only answer the constitutionally required questions on my census form, the first one, which states ‘How many people live at your residence’. That is all they need to know and all they will get from me. Right now, to find out my income, they just have to get Hillary to go get my tax records and browse through them (and then lose them in her office for several years).

      I’m getting the feeling that everyone seems to LIKE the government knowing so much about you? Really can’t imagine our founding fathers even thinking that this much intimacy between our ‘rulers’ and the caste is a good idea.

      Posted by: Rhinehold at September 2, 2007 12:45 AM
      Comment #231444
      And no one, at least not that I’ve read yet, on this blog will debate the issue that right now our poor are paying hidden taxes on necessities. The Fair Tax plan ensures that they no longer do. No other plan, not the flat tax or the current progressive tax plan in place now, can say the same thing because they both continue to hide the taxes that we pay in the price of every good we buy.
      Not true. I’ve written above that sales taxes hammer the poor, and corporate taxes are passed onto all consumers also (i.e. hiddne taxes). The poor, borderline poor, and even lower-middle-income, and middle-income groups spend ALL of their income. If all of their income is all taxed by a 30% sales tax, then their effective income tax rate is 30%. The poor get hammered. But so do the lower and middle income groups. The Flat 17% Income Tax Rate (with no tax paid by ANYONE on income below the poverty level; with no tax deductions, with no tax loop holes) doesn’t tax the poor, and doesn’t require a pre-bate. Rather than sending everyone a pre-bate (per the FairTax’s 30% sales tax), simply don’t tax income below the poverty level.
    • Posted by: d.a.n at September 2, 2007 12:58 AM
      Comment #231445
      It is a bit dishonest to call that a 23% sales tax, when most people understand sales tax to be a percentage of the item purchased.

      Actually, they understand that 23% income tax, which this would replace… It’s not very ‘dishonest’ and they even make a point of explaining it very well in their FAQ.

      I know the FairTax rate is 23 percent when compared to current income and Social Security rate quotes. What is the rate of the sales tax at the retail counter?

      30 percent. This issue is often confusing, so we explain more here.

      When income tax rates are quoted, economists call that a tax-inclusive quote: “I paid 23 percent last year.” For every $100 earned, $23 went to Uncle Sam. Or, “I had to make $130 to have $100 to spend.” That’s a 23-percent tax-inclusive rate.

      We choose to compare the FairTax to income taxes, quoting the rate the same way, because the FairTax replaces such taxes. That rate is 23 percent.

      Sales taxes, on the other hand, are generally quoted tax-exclusive: “I bought a $77 shirt and had to pay that same $23 in sales tax.” This is a 30-percent sales tax. Or, “I spent a dollar, 77¢ for the product and 23¢ in tax.” This rate, when programmed into a point-of-purchase terminal, is 30 percent.

      Note that no matter which way it is quoted, the amount of tax is the same. Under an income tax rate of 23 percent, you have to earn $130 to spend $100.

      Spend that same $100 under a sales tax, you pay that same tax of $30, and the rate is quoted as 30 percent.

      Perhaps the biggest difference between the two is under the income tax, controlling the amount of tax you pay is a complex nightmare. Under the FairTax, you may simply choose not to spend, or to spend less.


      Posted by: Rhinehold at September 2, 2007 12:59 AM
      Comment #231447
      The poor, borderline poor, and even lower-middle-income, and middle-income groups spend ALL of their income. If all of their income is all taxed by a 30% sales tax, then their effective income tax rate is 30%.

      Here’s where you lose it. Their effective income tax rate is 23%. It’s that ‘inclusive’ and ‘exclusive’ thing that you rail against. But even further because you don’t take into account that the 30% sales tax (23% inclusive HIDDEN income tax) that they currently pay under the current system would be removed. The result would be the SAME PRICE after sales tax.

      AND THEN, they would recieve the prebate that would remove ALL of their tax burden on the necessities of life.

      The Flat 17% Income Tax Rate (with no tax paid by ANYONE on income below the poverty level; with no tax deductions, with no tax loop holes) doesn’t tax the poor, and doesn’t require a pre-bate. Rather than sending everyone a pre-bate (per the FairTax’s 30% sales tax), simply don’t tax income below the poverty level

      Except that you WILL tax everyone below the poverty line with the HIDDEN TAXES that you say you’ve talked about and rail against. They are still there and the poor will still pay them. How are you saving them from that tax burden if you don’t remove it?

      Only the Fair Tax plan, of all of the plans on the table (and I’m being kind because there *IS NO* flat tax plan on the table), would reduce the tax burden on lower-income households to 0 by removing the hidden taxes in each and every good and service we currently buy.

      Posted by: Rhinehold at September 2, 2007 01:07 AM
      Comment #231448

      There are two things that bother me about income taxes - 1) that income tax has been considered a direct tax, in that (from what I gather) are mandatory, but subject to the rule under the Constitution of apportionment, which means that it is required to be equally distributed among the states. The government will not prove to us that this is happening. For instance, have you ever read a comprehensive annual finacial report from the federal government for which accounts for every penny of our income tax as being spent in this way or that? I mean apart from the numerous other revenues it takes in. In order for the income tax, and therefore the 16th amendment to be valid, the rule of apportionment must be adhered to, and insofar as has been provided by our government, there is no proof that this is the case. 2) That income has been defined as profits and gains for services, which, when juxtaposed to the reality of the income we know as an EXCHANGE of service for compensation, contradicts the legality of the 16th amendment.

      Moreover, that the 16th amendment directly contradicts, without due explanation, article 1, section 2, clause 3 of the Constitution. The text:

      Article 1, sec.2, clause 3:
      “Representatives and direct taxes shall be apportioned among the several states which may be included within this union, according to their respective numbers, which shall be determined by adding to the whole number of free persons, including those bound to service for a term of years, and excluding Indians not taxed, three fifths of all other Persons.”

      & the 16th amendment:
      “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.”

      Is it just me, or does that seem a little fishy?

      BTW, it is taking a considerable amount of time to watch and simultaneously fact check the video I linked to earlier. Especially with the innate bias that every tax payer undoubtedly is beholden to, that taxes suck. I am trying my best to approach this topic with as much clarity as can be permitted by my contradictory desire to guzzle a couple of beers on a staurday night. :)

      Posted by: wtc7 at September 2, 2007 01:15 AM
      Comment #231450

      Couple of tidbits to chew on.

      1) This “FairTax” would only tax sales of new goods. So what would this do to the housing market, since the tax would only be on new home sales? Ditto on the automotive sector.

      2) How would this affect sales of items over the Internet? If I want, I can buy stuff from all over the world. Wouldn’t this massive influx of non-American consumer goods hurt the American economy? Wouldn’t there end up being a Cyber-tarriff system? And also, what would this do to our current trade deficit?

      3) What about the hundreds of thousands of people, from accountants to employees of tax software companies to members of the IRS, who would be out of jobs from this? The best answer I’ve found is “they are highly skilled, they’ll be fine”.

      4) Here’s a kicker to the 15 year old with his 360. Say he can buy a used one at a Gamestop or EB or GameCrazy or whatever.

      5) For this to be tax-neutral (i.e. bring in as much revenue as the govt currently gets) I’ve seen numbers as high as 31% inclusive 44% exclusive. And thats from Rhinehold’s own Wiki link BTW.

      6) In order for this to really take effect, they would have to repeal the 16th Amendment, otherwise we would just have two tax systems stacked on each other, both valid and chock full of neat loopholes. Check the same Wiki article for more.

      In a nutshell, I think this is a baby-with-the-bathwater idea. Instead, we should just lower real taxes and get rid of all but a few of the loopholes. Keep things like charity donations and writeoffs for companies trying to green up. Never gonna happen, but hey, I’m an optimist.

      L

      Posted by: leatherankh at September 2, 2007 01:16 AM
      Comment #231452

      Rhinehold, I ve just spent time reading the national sales tax plan at the “Fair Tax” site. I couldnt fine the poof a miracle happens part though. I did find the parts where no matter who you are no matter where you are no matter what stage of life your in you pay less in taxes. In fact not only you but every one else, according to the site,will pay less taxes forever and ever, yet its revenue neutral. Is this all hinged upon our spending patterns staying the same when the rules of the game changes so drastically?

      The part about the new house only being taxed amazed me as I can see we will never ever build a new house in this Country again, only used houses. But miracle of miracles even if we do buy a new house its cheaper because well because interest rates only go down in LALA land never up when its a “fair tax”. However the tax is due on sale so the costs to get in will of course be drasticvally higher but what the hell do we care we got ours right?
      As far as your example above “Because during difficult times due to loss of a job or an inability to work, people may not have as much income, or may have no income at all. They borrow funds or use savings. They may not have earnings, but they still continue to consume.” is concerned with a significent reduction in income their consuption rate would natural fall as they resorted to used goods would it not? Then in a short time they would be under the poverty level and get whatever bates the sales tax plan gives. With this in mind Mr Korves logic seems more like a rah rah speech than a sound “study”. Ya know sometimes when it sounds to good to be true its because its to good to be true.

      Posted by: j2t2 at September 2, 2007 01:27 AM
      Comment #231457

      j2t2,

      You currently pay that 30% sales tax already on every new home you buy.

      It is passed on to you, the consumer, in the price of the house, when everyone involved in the house building passes the income tax that they have to pay for each part of the house on.

      It’s the most painful and annoying thing about the plan, no one seems to realize that they are already paying these taxes each and every day, only they are being FOOLED by the rulers of our country into thinking that they aren’t.

      So, if now a new house cost you 150,000, after the Fair Tax plan is enacted it will still cost 150,000 (tax included). Why would we not be buying new houses? Some states have sales taxes (though they are not intended to counter income tax and have no mechanism for the poor not to pay them) and we still buy new houses, why the illogic assumption that no one would again?

      Posted by: Rhinehold at September 2, 2007 01:53 AM
      Comment #231458

      Aemen j2t2. And to tax the consumption of necessities is to tax the very air we breath. I especially disagree with the taxation of any form of free exchange (as in fair and PRIVATE trade), and feel that any taxation at all should first be concerned and bound by the idea of profiteering. For, to profit is to gain on the ignorance of another, for the benefit of the self. The complexities of life today freely permit it, and, with the consent of the fooled are reeled into a prosperous economy, consisting of the submittal of capitol yielding to the intuitiveness of greed. So, any hand government may have in culling the so called free economy should be shaped as a small cup, to dip sparingly in the trough of money leaving the hands of the wealthy, the frivolous, and the infrastructural import.

      Posted by: wtc7 at September 2, 2007 01:54 AM
      Comment #231459
      With this in mind Mr Korves logic seems more like a rah rah speech than a sound “study”.

      BTW, his research was not that we are paying hidden taxes, but what amount, exactly, we are paying. He did one thing that the federal government refuses to do, tell you how much in taxes you pay each year.

      Posted by: Rhinehold at September 2, 2007 01:55 AM
      Comment #231460
      For, to profit is to gain on the ignorance of another, for the benefit of the self.

      Wow. Maybe an economics class would say something different?

      BTW, how is it ‘gaining on the ignorance of another’ if I provide a service to another person that I can do better and more happily than they can, giving them time to do what they do better and enjoy doing more and providing that good or service to someone else?

      Posted by: Rhinehold at September 2, 2007 01:59 AM
      Comment #231461
      to tax the consumption of necessities is to tax the very air we breath

      So, you hate the current tax system then, right? Since that is what we do every day here in the US…

      Posted by: Rhinehold at September 2, 2007 02:00 AM
      Comment #231465

      The FairTax is a 30% Sales Tax.
      You can call it something else or try to disguise it as something else, but it is a 30% Sales Tax.

      The point is there is some confusion (and/or dishonesty) in the way the 30% Sales Tax (FairTax) rate is being conveyed.

      A sales tax is understood to be a percentage of the price. Therefore, a 30% sales tax is 30% of the price. The 23% figure is a bit dishonest when talking about a Sales Tax. It’s a clever way to make the sales tax look smaller. Already within this thread, people incorrectly assumed and incorrectly calculated the Sales Tax as 23% of the price, when it is actually 30% of price.

      The 23% comes from TAX/(TAX+PRICE).
      The rationale for that is because of the way income tax works, which is TAX/(INCOME+TAX).
      That is considred a 23% income tax.
      That is, if $30,000 of income tax is withheld from $130,000 income, it is considered 23% income tax.

      Either way (a 30% Sales Tax, or 23% Income Tax), it is too high. Making one tax so high on one tax will guarantee a blackmarket.

      Except that you WILL tax everyone below the poverty line with the HIDDEN TAXES that you say you’ve talked about and rail against.
      Not true. No one pays income taxes on income below the poverty level. The flat 17% income tax does not hide or impose taxes on the poor. Corporations pay no taxes (because they would and do simply pass it along as hidden taxes to all consumers). Therefore, the hidden taxes you speak of don’t really exist.

      Again, the problem with the 30% Sales Tax (i.e. FairTax) is that it is not fair.
      Here is why (PROs and CONs).

      The FairTax has a HUGE problem. After the pre-bate (which is an unnecessary complication and prone to fraud and accounting nightmares), the poor and lower-to-middle income groups get hammered at a 30% sales tax.
      For example:

      ___The Wealthy Scenario ___
      [EXAMPLE # 1] Income=$300,000 , Spends=$100,000 , 30% sales tax=$30,000 which is only 10% of their $300,000 income.
      [EXAMPLE # 2] Income=$500,000 , Spends=$100,000 , 30% sales tax=$30,000 which is only 6% of the $500,000 income.
      [EXAMPLE # 3] Income=$1 million , Spends=$500,000 , 30% sales tax=$150,000 , which is only 15% of the $1 million income.

      ___The Middle-Income Scenario ___
      [EXAMPLE # 4] Income=$40,000 , Spending=$40,000 , 30% sales tax=$12,000 , which is a whopping 30% their $40,000 income.
      [EXAMPLE # 5] Income=$60,000 , Spending=$40,000 , 30% sales tax=$12,000 , which is a whopping 24% their $60,000 income.

      ___The Borderline Poor Scenario ___
      [EXAMPLE # 6] Income=$30,000 , Spending=$25,000 , 30% sales tax is $7,500 , which is a painful 25% their $30,000 income.
      [EXAMPLE # 7] Income=$25,000 , Spending=$25,000 , 30% sales tax is $7,500 , which is a punishing 30% their $25,000 income.

      Thus, it’s no wonder Republicans and the wealthy like this FairTax. However, it should be renamed to the UN-FairTax. As you can see above, the poor get hammered. Their tax is 30% of their income. The lower-middle and middle-income groups get taxed more too.

      And one thing you’ve omitted is that incomes will have to be reduced under the 30% Saiels Tax system. After all, corporations are not going to let employees keep the income tax money that they were previously sending to the IRS. After all, the corporation will being paying 30% Sales taxes now on products. Therefore, the money has to come from somewhere. That somewhere means it will come from salaries that will be reduced. Otherwise, the corporations are not losing money.

      Another problem is all the money that people have already paid income taxes on. With a 30% Sales Tax, they will now get taxed again. Ouch!

      Under the 17% Income Tax Rate, only after a person’s income exceeds the poverty level, it is taxed at 17%.

      EXAMPLE:

      Given:
      (1) a flat income tax of 17% ,
      (2) and a poverty level of $12K ,
      (3) and an N factor of 1.5
      (4) therefore, low-income-exemption-level is 1.5 x $12K = $18K
      (5) and six persons with different gross incomes (K=$Thousand):

        A earned $15K per year
        B earned $20K per year
        C earned $30K per year
        D earned $100K per year
        E earned $200K per year
        F earned $400K per year
        G earned $900K per year
        H earned $9M per year (M = $Million)
      A tax = $0 =0.17 x ($0) = 0% of $15K = 17% of ($0) ; since $15K £ $18K
      B tax = $340 =0.17 x ($20K-$18K) = 1.7% of $20K = 17% of ($20K-$18K)
      C tax = $2,040 =0.17 x ($40K-$18K) = 6.8% of $30K = 17% of ($30K-$18K)
      D tax = $13,940 =0.17 x ($100K-$18K) = 13.9% of $100K = 17% of ($100K-$18K)
      E tax = $30,940 =0.17 x ($200K-$18K) = 15.5% of $200K = 17% of ($200K-$18K)
      F tax = $64,940 =0.17 x ($400K-$18K) = 16.2% of $400K = 17% of ($400K-$18K)
      G tax = $149,940 =0.17 x ($900K-$18K) = 16.7% of $900K = 17% of ($900K-$18K)
      H tax = $1,526,940 =0.17 x ($9M-$18K) = 16.97% of $9M = 17% of ($9M-$18K)
      • (a) The 30% Sales Tax (with pre-bates)

      • (b) The 17% Flat Income Tax on all forms of income (no tax loop-holes, no deductions, no tax for ANYONE on income below the poverty level, no corporate taxes passed onto consumers)

      Rhinehold, There’s no need to fret about this too much, because Do-Nothing Congress ain’t gonna do a damn thing about it until the voters stop repeatedly re-electinng and rewarding irresponsible, bought-and-paid-for incumbent politicians and repeatedly rewarding them with a cu$hy 90%-to-95% re-election rate.

      Governemnt won’t become resonsible and accountable until the voters do too.

      Posted by: d.a.n at September 2, 2007 02:10 AM
      Comment #231466

      We have a simple difference in perspective, Rhinehold, and it’s here: “if I provide a service to another person that I can do better and more happily than they can”

      That is gaining on the ignorance of another, even though you omit the point I made about the profiteering. That is not such a bad word, as it is human nature to profit. Tax that. I need to drink water, do not tax that. I can’t be more clear.

      Posted by: wtc7 at September 2, 2007 02:14 AM
      Comment #231468
      After all, the corporation will being paying 30% Sales taxes now on products.

      Again, you miss two important things. 1) the hidden taxes would be removed before the sales tax applied so the corporations would be paying the same and 2) They wouldn’t be paying that tax because the tax is applied at the retail level, not the wholesale level.

      What that means is that if you purchase a product to put into another product, that product would not incur the 30% sales tax.

      BTW, Your ‘pros and cons’ link is ludicrous when it doesn’t get the facts right on the Fair Tax plan. You are arguing a flat tax against a tax system that is not being proposed and then claiming it is better. Hurrah for you, but it just isn’t accurate, as we can see in these statements you are making.

      Not true. No one pays income taxes on income below the poverty level. The flat 17% income tax does not hide or impose taxes on the poor. Corporations pay no taxes (because they would and do simply pass it along as hidden taxes to all consumers). Therefore, the hidden taxes you speak of don’t really exist.

      I guess I’m confused here… do the corporations pay income taxes or not under your imaginary flat tax plan (that doesn’t exist and isn’t in a bill before congress)? If they do not, then I think you’ll find some democrats being very upset with your ‘passing the burden onto the poor’ by making everyone BUT corporations pay income tax. If they DO pay income tax, that tax gets passed on in the goods and services provided.

      We already pay the 30% sales tax you are fearing, why not accept that and choose to SEE it when you pay for something instead of pretending it doesn’t exist and rail against how it would hurt people?

      Let’s look at your ‘example’ shall we? Where in your calculations is the prebate added back in? I don’t see it… That seems highly ‘dishonest’ of you, don’t you think?

      Let’s put your ‘Example 7’ through the Fair Tax Calculator shall we?

      Assuming a single person, making 25,000 and only buying NEW things:

      The annual tax-free spending allowance for your household is: $10210

      Your household will receive a monthly tax prebate check in the amount of: $195.69

      Your taxable income left to spend after deducting your tax free spending listed above in lines 2 to 8: $14790.00 (I put in 0, that will most likely be more, includes used items purchased and not taxed, loan payments, charitable contributions, etc)

      Your maximum annual FairTax dollar costs (including social security contributions) based on estimated income & spending above: $3401.70

      Your estimated annual net effective FairTax rate on the income & spending listed above: 13.61%

      Gee, that seems like a different number than you provided. I wonder where the discrepency is? Perhaps, and I know this is a stretch, perhaps you don’t fully take into account all aspects of the FairTax before running your numbers through to show how they are so much worse than your imaginary Flat Tax plan?

      Posted by: Rhinehold at September 2, 2007 02:30 AM
      Comment #231469

      BTW, a small note from the calculator that I think you fail to take into account when calculating your ‘17%’ flat tax:

      The FairTax eliminates FICA Social Security taxes (7.65%) and funds Social Security and Medicare as part of the 23% inclusive sales tax revenues. When comparing your FairTax rates above to your current income tax rates, or any estimated Flat Tax rates, remember to add your 7.65% FICA payroll taxes to your Income Tax expenses before comparing your tax rates. The proposed Flat Tax of 17% will not e affect your current FICA payroll deductions, so the current Flat Tax proposal would really be a 17% + 7.65% FICA = 24.65% initial rate before deductions, clearly higher than FairTax’s 23%. Be sure to check your paycheck stubs to see exactly what dollar amount you are paying for FICA social security and medicare through payroll tax deductions. Remember, your employer is also paying 7.65% into FICA on your behalf, money that he/she cannot give you in the form of higher wages. The FairTax eliminates both of these taxes.
      Posted by: Rhinehold at September 2, 2007 02:33 AM
      Comment #231470

      BTW, Dan, let’s compare your ‘comparisons’ with this one.

      And it appears I was wrong, there is a Flat Tax plan, HR 1040 by Armey. That is one of the plans compared so you should find it interesting.

      Posted by: Rhinehold at September 2, 2007 02:43 AM
      Comment #231471

      No, I see what’s going on here - I’m not going to be drawn into the arguement about how best to tax our incomes when no one has yet acknowledged the point about whether or not the income tax is even legal in the first place.

      I have conceded the 16th amendment, and have also pointed out the contradiction to article 1, sec.2, clause 3 of the constitution, which has yet to be challenged.

      I don’t mind being wrong at all, but I want an answer to the the 16th amendment. So far in my fact-finding quest, I have had the good graces to come across this supreme court ruling about the constitutionality of the 16th amendment, but where I find real deficit is in the intelligent response here, in which I am usually not disappointed.

      Where is the answer on the question of the apportionment of direct taxes and the concrete evidence that income taxes, as they are, are not direct taxes but indirect taxes (which are voluntary)? Why begin the arguement of how best to tax income without deciding first whether or not you can legally do that?

      I hope that people are watching the video I linked — and after seeing the whole thing, I can again conclude that documentaries like this are biased, but there are numerous constitutional questions arising from the idea that the government, and thereby, the people, have a right to the property of other American citizens.

      Posted by: wtc7 at September 2, 2007 02:56 AM
      Comment #231472

      True, I din’t include the prebates.

      But it does not change one important fact, which is the main problem with any sales tax:

        Income or wealth (i.e. ability to pay) does not matter.

      With any sales tax, the wealthier a person is, the more of a tax break they will get. That’s the essence of any sales tax system. The reason is because the poor and lower-income to middle-income groups spend most (if not all) income just to get by. Not the wealthy who would find it difficult to spend all of their income, which would grow and grow with NO tax on interest or capital gains.

      An income tax rate system does not have that problem.

      That is an inescapable fact that dooms the FairTax. That simple concept is easy enough for most to understand. Even on this blog, the majority are NOT in favor of a 30% Sales tax.

      Posted by: d.a.n at September 2, 2007 03:00 AM
      Comment #231473

      In effort to fix that link so that you don’t have to log in in any way, here is the new one 157 U.S. 429

      Posted by: wtc7 at September 2, 2007 03:04 AM
      Comment #231474
      Even on this blog, the majority are NOT in favor of a 30% Sales tax.

      Yet, that is exactly what our current income tax system is. And everyone here seems keen on keeping it just that way. Oh, without the ‘transparency’ that is. No, that you sure don’t get with an income tax…

      Posted by: Rhinehold at September 2, 2007 03:05 AM
      Comment #231475

      I apologize — Earlier on in the night, I did not have to log in to view the ruling of 157 U.S. 429, but I cannot get to it now through this site. Regardless, that is the case number, and I am retiring to the matress. Good night.

      Posted by: wtc7 at September 2, 2007 03:10 AM
      Comment #231476

      It can be viewed here: http://www.law.cornell.edu/supct/html/historics/USSC_CR_0157_0429_ZS.html

      Posted by: Rhinehold at September 2, 2007 03:11 AM
      Comment #231477

      BTW, wtc7, I can view the link you provided without logging in. Not sure what your issue is.

      Posted by: Rhinehold at September 2, 2007 03:15 AM
      Comment #231478

      Rhinehold,
      I’ve seen Dick Armey’s Flat Tax, and it is not the same as the 17% Flat Rate Income Tax system
      The 17% Flat Income Tax would eliminate all tax loop holes.
      The 17% Flat Income Tax would not require a change to Amendment 16.
      The 17% Flat Income Tax would eliminate corporate taxes and stimulate exports.
      The 17% Flat Income Tax would not double tax (the FairTax would double tax money that an income tax was already paid on; the Fair Tax would double tax because of that).
      The 17% Flat Income Tax would tax inheritence and gifts at the same 17% as all income.
      The 17% Flat Income Tax would greatly reduce paperwork and tax preparation since there are no longer ANY complicated tax loop-holes and deductions.
      The 17% Flat Income Tax wouldn’t need the complication of pre-bates. That’s a costly operation and an accounting nightmare that is also wide open to fraud and theft.

      But the main thing is (aside from these other things), the 17% Flat Income Tax would not hammer the lower income groups like a 30% Sales Tax (i.e. FairTax) will. The inescapable fact of any sales tax is that the lower income groups that spend all (or most) of their income to simply get by will pay more taxes (as a percentage of income) than the wealthier income groups. Because of that, the 30% Sales Tax system (i.e. Fair Tax) is a very unfair tax system.

      Posted by: d.a.n at September 2, 2007 03:20 AM
      Comment #231479

      Thank you, Rhinehold. I don’t know why but it’s asking for my login and email now (maybe I’ve reached the viewing limit). Anyway, what’s important is that the case number is here, and you have provided an alternative link, so again thanks.

      Posted by: wtc7 at September 2, 2007 03:22 AM
      Comment #231480

      Dan,

      You are not correct about it hammering the lower income groups, necessities would be paid for for anyone at or below the poverty level and they would pay the exact same amount under the FairTax as they do now for goods and services.

      You can keep SAYING that it will hammer them but it won’t. I’ve shown the figures and given the reasons, you ignore them and choose to argue against a straw man you’ve created. The facts are that the poor would do better under the FairTax than they do now.

      Your plan, on the other hand is the worst of both worlds. Those wanting to keep the current tax plan to manipulate the tax code as a matter of politics would still do so and it will shift the tax burden to the middle class and away from corporations. Those wanting to do away with the IRS and our government having our income information on hand will know that they are still being tracked and divided through the political process by their income.

      BTW, since you want to keep calling the FairTax a 30% sales tax, can I start calling your 17% income tax a 24% income tax? You are leaving out FICA after all in your plan… 23% income tax (which is what the 30% sales tax equates to) is less than the 24% income tax you are advocating…

      Posted by: Rhinehold at September 2, 2007 03:31 AM
      Comment #231481

      Sorry Rhinehold, but it is a mathamatical certainty. Prebates only go so far. After that, the 30% Sales Tax results in more taxation on lower income groups, because the wealthiest don’t spend all of their income. In fact, the wealthy earn a lot of income from interest and capital gains, and elimination of income taxes would make it grow even faster.

      A 17% income tax is not the same as a 24% Sales Tax. A 17% income tax is already inclusive by virtue of the very nature of an income tax. Also, I did not leave out FICA. It is part of the 17% income tax.

      I keep saying it will hammer the lower income groups because it will. Again, it’s a mathematical certainty since the lower income groups spend most of their income to simply get by. It doesn’t improve much through out the middle-class, even though they may save a bit more. The wealhty and hyperwealthy can amass more and more wealth (especially with no taxes on capital gains and interest income) that is essentially tax free. They can also gift it without being taxed. And inheritance income wouldn’t be taxed either.

      And I call it a 30% Sales Tax because that is exactly what it is.

      A 17% income tax is exactly that too.

      The poor will not do better under the FairTax system based on the prebates I’ve seen. Also, that whole pre-bate thing is a complicated mess, a huge and unnecessary operation, and wide-open to abuse and additional cost to tax payers. Anytime the government makes itself a guarantor of payments like this, fraud is rampant (e.g. Social Security and Medicare).

      Thus, in my opinion, the 30% Sales Tax (i.e. Fair Tax) is the worst tax system possible. Here, I’ve updated my list.

      You know people that have already paid income tax on their savings and such are not going to be happy about paying another 30% tax when they spend it. That just isn’t going to work.

      Posted by: d.a.n at September 2, 2007 03:55 AM
      Comment #231482

      Also, good luck getting the 16th Amendment repealed. That’s about as likely as Do-Nothing Congress allowing an Article V Convention.

      Posted by: d.a.n at September 2, 2007 03:59 AM
      Comment #231484
      You know people that have already paid income tax on their savings and such are not going to be happy about paying another 30% tax when they spend it.

      Again, the product or service that is $500 will still be $500 (tax included). So where is the extra money they will be spending?

      You keep leaving out that the hidden 30% tax on these products that we already pay NOW will no longer be there in these ‘calculations’.

      As for the ‘complicated’ bit about the prebate, that’s not accurate either. Have VISA issue debit cards to these people (anyone with a SS card) and THEY will gladly pay for the cost of electronically putting that prebate onto the card each month, knowing that they will be making their money back through the use of the card at merchants. No cost to the government for the process.

      Posted by: Rhinehold at September 2, 2007 04:19 AM
      Comment #231485

      The question here is not whether the poor will pay more in taxes, but whether the rich will pay less, and if they do, where the resulting loss in government revenue be made up. That is my real beef with both the “fairtax” and flat tax plans. Even taking into account that simplified tax codes will decrease chances for the rich to cheat, will either of these plans that Rhinehold and d.a.n. are espousing truly be revenue neutral? To quote Wiki:

      William Gale of the Brookings Institution published a detailed 2005 study in Tax Notes that estimated a rate of 28.2% (39.3% tax-exclusive) for 2007 assuming full taxpayer compliance and an average rate of 31% (44% tax-exclusive) from 2006–2015 (an increase that accounts for the replacement of an additional $3 trillion in revenue collected through the Alternative Minimum Tax (AMT) impacting the middle class over the 10 year period).[2][32][33] The study also concluded that if the tax base were eroded by 10% due to tax evasion, tax avoidance, and/or legislative adjustments, the average rate would be 34% (53% tax-exclusive) for the 10 year period. The study did not take into consideration the increase in economic activity that Gale expects would result from the imposition of the FairTax. The President’s Advisory Panel for Federal Tax Reform performed an analysis to replace the personal income tax (excluding other taxes) with a retail sales tax and found the rate to be 25% (34% tax-exclusive) for 2006.[6] The rate would need to be substantially higher to replace the additional taxes replaced by the FairTax (payroll, corporate, captial gains, estate, and gift taxes). In determining the rate, the panel assumed that there would be a tax-evasion rate of at least 10% and that revenue generated from taxing federal spending would be canceled out by increased government expenditures required to pay such taxes.[6]

      If this is the case, a 30% exclusive rate would mean a significant downturn in revenue, which would mean that a good ammount of government programs would be axed. This sounds like a conservative slash-and-burn wolf in a “fairness” sheep’s clothing to me.

      My problem with a flat tax is similar. If you tax a person at 17% who makes $25K a year, they would have $20,750 left over, but their tax rate would be much less since they are close to the poverty line. They will not feel much of a change. If you tax someone at the same rate who make $2.5 million a year, they will be taxed more because of fewer loopholes, but they will still pull in over $2million a year. They may whine and moan about it, but they still are millionaires. So far so good. Where the problem shows up is in the middle class. As a proportion of their income compared to cost of living, they would be taxed far more than anyone else, especially those just making it into the middle class.

      Those who expouse these “fair” tax programs often forget one thing. If it weren’t for the government and it’s programs and incentives, the wealthy never could have become rich in the first place. Having those who can afford to pay more do so in order to help those who cannot afford it is the only fair practice. Now we just need to impliment it. Kill all the tax loopholes for the rich and lower taxes for the middle class. That is a “fair tax”.

      L

      Posted by: leatherankh at September 2, 2007 09:37 AM
      Comment #231496


      Three presidents from the fiscally responsible party created 70% of a nine trillion dollar debt. They accomplished this great feat primarily by reducing taxes on the wealthy. Now a proposal that would reduce furthur the tax burden on those who have been the prinary beneficiaries of the bulk of the tax breaks.

      Another name for the fair tax is greed.

      Greed is a disease that gets progressively worse over time if it is left untreated and it has been left untreated so long that we may not recover from it without an extremely painful operation.

      Posted by: jlw at September 2, 2007 11:46 AM
      Comment #231497

      Rhinehold Im not following you when you make statements such as:
      “You currently pay that 30% sales tax already on every new home you buy…..So, if now a new house cost you 150,000, after the Fair Tax plan is enacted it will still cost 150,000 (tax included). “

      “Again, the product or service that is $500 will still be $500 (tax included). So where is the extra money they will be spending?…You keep leaving out that the hidden 30% tax on these products that we already pay NOW will no longer be there in these ‘calculations’.”

      It seems you are saying that because of the restructuring of the tax system goods and services will come down by 30% which will cover the costs of the tax. However on the fair tax website their example of the $230K house doent indicate that, it shows the sales tax in addition to the price of the house. The savings seems to appear because of the same 30% in taxes that according to you are already in the price of the home being added back in to the calculations on the income side of the example and of course the lower interest rate due to the sales tax. This example doesnt seem to show the sales tax being financed for the life of the mortgage so again it would significantly raise the costs of getting into the house. So if the 30% is saved in the cost of building new houses then all of us that already own will see the value of our existing house drop by oh say 30% if we were to sell the house.

      All,
      It just seems to me that the “Fair Tax” plan does everything for everybody according to the website. Well everyhting but curing cancer. It lowers costs by 30%, we all pay less in taxes, there will be no loss of Government revenue/programs. I guess I should be impressed by all the millions the “Fair Tax people have spent on studies to support their position on a national sales tax, but after watching Exxon spend millions to propagandize the climate change issue, this sort of I’ll pay you to support my belief study isn’t quite as impressive.
      On the website they claim our founding fathers believed that consumption tax was the only good means of taxation. I didnt notice any supporting study to back that up. Im wondering how true that statement is.

      Posted by: j2t2 at September 2, 2007 11:58 AM
      Comment #231501

      d.a.n., good to see your postings again. I think Flat Taxers will need to heed Davids warning in his excellent article for the flat tax plan to get its due with the American people. Flat Tax sounds ..well flat or fat or fart or well Fair, to easily manipulated by others. In that vein I propose a name change to help with the salesmanship, lets see Fair Tax is already spoken for so perhaps “Most Fair” or “Even more than Fair”, nah how about “Fairest Tax Plan” or “Fair for everyone not just the wealthy tax plan”. Nah, lets see ” Fairest of them all tax plan”, nah sounds like a fairy tale, “Fairer than Fair tax plan”, well ..nevermind. Lets try Freedom Tax plan or ..well perhaps Flat will work after all.
      My point is this.. It appears the fair tax people are well funded and have soundbited their talking points for public consumption. In order to be heard over the shouting the Flat tax proponents may have to do the same to gain the attention of the American public or as David points out it will be the Federal Sales tax that wins the hearts and minds of the people and will become law. Just being a more logical approach may not be enough to get heard these days.

      Posted by: j2t2 at September 2, 2007 12:36 PM
      Comment #231502
      Again, the product or service that is $500 will still be $500 (tax included). So where is the extra money they will be spending?
      Not true. With a 30% Sales Tax, if the PRICE is $385, then the 30% Sales Tax makes the total $500. With a 30% Sales Tax, if the PRICE is $500, then the 30% Sales Tax makes the total $650.

      SALES TAX: The major factor is spending. All sales tax systems come at things from the opposite direction. Thus, income is irrelavent.

      INCOME TAX: Income is the major factor. Income is relavant. Spending is not.

      A 30% Sales Tax (i.e. FairTax) makes federal revenues completely dependent on spending. That could be very unpredictable, since spending is more variable than income (especially during a recession; which occur every 2 to 11 years for the past 46 years).

      Again, people that have already paid income tax on their savings will be taxed again (at 30%) when they spend it. That is double-taxation. Add that 30% Sales Tax to the average income tax rate of 21% and 15.3% Social Security and Medicare tax, and they’ll essentially be paying a 66% tax. This will be a major stumbling block for the 30% Sales Tax.

      Also, with a 30% Sales Tax, all incomes would have to be reduced by the amount of income tax, Social Security, and Medicare that all employers and others pay now. The employer’s pay half of the 15.3% for Social Security and Medicare. All incomes will have to be reduced for the 30% Sales Tax to work. The money has to come from somewhere. This is a nother detail that is conveniently over-looked by the 30% Sales Tax (FairTax) comparisons.

      You keep leaving out that the hidden 30% tax on these products that we already pay NOW will no longer be there in these ‘calculations’.
      Not true. What hidden taxes are you talking about (exactly)? Corporate taxes? That is the best example of a hidden tax. However, the 17% Income Tax Rate does not have a corporate tax, because the would simply be passed onto to all consumers (i.e. a hidden tax). So, what are these other hidden taxes? Specifics please.
      If this is the case, a 30% exclusive rate would mean a significant downturn in revenue, which would mean that a good ammount of government programs would be axed. This sounds like a conservative slash-and-burn wolf in a “fairness” sheep’s clothing to me.
      You got that right. The most important fact about ANY sales tax is that the lower income groups spend all (or most) of their income. The wealthier spend less of their income and will amass even more income when there is no longer any income tax on capital gains and interested earned.
      Those who expouse these “fair” tax programs often forget one thing. If it weren’t for the government and it’s programs and incentives, the wealthy never could have become rich in the first place.
      That’s right. Currently, the rich can exploit a complex myriad of tax loop-holes and captical gains are taxed below the average income tax rate. That’s why Warren Buffet pays a lower income tax rate than a middle-income secretary making $60K annually. The 30% Sales Tax will make it even worse, since lower income groups spend are larger percentage of income, which means more 30% sales tax.
      d.a.n, quite right. And this “Fair Tax” proposal eliminates estate taxes, capital gains taxes, and other investment taxes, finally opening wide the doors to a true plutocratic led government. Rule by the wealthiest (lobbyists and campaign donors).
      Yes, that trend is already bad enough without making it worse. 40% of all wealth is owned by 1% of the population. 50% of the population is basically broke (Net Worth = $0). Pass a 30% Sales Tax and watch that trend accelerate drastically. Now the wealthy can gift vast wealth to whoever they please without any income tax. Gee, I wonder how this will affect politicians? Seeing how government is already FOR-SALE. Do you suppose the FOR-SALE politicians will receive some tax-free gifts? All perfectly legal and untraceable.

      Also, the 17% Income Tax system does NOT tax anyone’s income below the poverty level. In 2004, that was about $10K. Also, the 17% Income Tax system has the flexability to change the lower cut-off (i.e. N x Poverty level; where N >= 1.0). This helps the lower income levels the most first. The 30% Sales Tax helps the wealthiest first.

      So fair tax proponents, if I buy 1 share of stock for $1 then I would pay $1.23 + 4% to the broker. Then I wait until the stock goes up 27% before I break even?
      No, it’s worse than that. You would pay $1.30 + 4% to the broker. You’d have to wait until the stock goes up 34% to break even. It is a 30% Sales Tax. The 23% is deceptively leading many to think it is only a 23% Sales Tax, but it is actually a 30% Sales Tax. The 23% is cleverly calculated as TAX/(TAX+PRICE). But that is not the way any sales tax is calculated. That is the way Income tax is calculated. It is inresting that a 30% Sales Tax is using an Income Tax calculation (i.e. INCOME TAX RATE = TAX/(TAX+INCOME) method to make the Sales Tax seem smaller. As you can see many times through this thread, the deceptive 23% value is being misapplied. I suspect it is by design. However, it hurts the FairTax by making it look dishonest and cleverly deceptive.

      In addition to the payment I pay on my home loan every month I would now pay an additional 23% every month on the principal or principal interest and insurance? Or would I pay 23% due when I buy the house which would mean instead of 20% down I would need 43% down?

      “Somebody would have to show me how we’re going to make that transition,” Mr. Giuliani said of the FairTax. “Also, the thought that there wouldn’t be an IRS with the FairTax [i.e. 30% Sales Tax] — well, who is going to administer the sales tax? And who’s going to administer the people that are exempt from the sales tax?” … Mr. Giuliani said he’s read and even underlined “The FairTax Book,” the standard defense of the proposal, and says it looks like a false hope to him.
      I’m not a Guiliani fan, but he’s right about this.
      For now, it remains mostly a Republican issue, as almost none of the congressional co-sponsors are Democrats.
      I’m not a Democrat (nor Republican), but the Democrats got it right this time. Now, if they would first eliminate the tax-loopholes, it would be a big step in the right direction. Then perhaps tax rates could be reduced for all income groups? Lower taxation will lead to less tax evasion. Unreasonable taxation is mostly what creates most tax evasion.
      If I make a widget, I have to pay income tax on that widget. So to clear XXXX each month to buy things like food and such, I have to charge what the widget costs, and operating expenses, AND the income tax that I pay. So the income tax I pay goes into the price of the product, which everyone now pays when they purchase that product.
      Bad argument. Regardless of whether it is an income tax or sales tax, all taxes drive up the cost of everything.
      Craig Holmes wrote: The “Fair Tax [30% Sales Tax]” won’t work. Here is why. In tax “theory” it is better to have many “little” taxes than fewer “large taxes”. The reason is that if the tax rate is high it encourages avoidance and fraud. If you eliminate all of the taxes they say and place the tax burden all on one place “consumption”, you drastically increase the insentive to cheat.
      Yes, such a huge 30% sales tax will create black markets. Tax evasion is less when taxes are reasonable. Which would you rather have? (a) 30% Sales Tax (with pre-bates) (b) 17% Income Tax (on income above N x poverty level; no tax loop-holes).

      Again, this is all somewhat pointless, since Do-Nothing Congress isn’t even remotely inclined to change the tax system, or pass any other badly-needed, common-sense, no-brainer reforms. Especially as long as most voters re-elect and reward incumbent politicians for it. As long as they do that, they squander their votes and they have the government they deserve.

      Posted by: d.a.n at September 2, 2007 12:40 PM
      Comment #231504
      Three presidents from the fiscally responsible party created 70% of a nine trillion dollar debt. They accomplished this great feat primarily by reducing taxes on the wealthy. Now a proposal that would reduce furthur the tax burden on those who have been the prinary beneficiaries of the bulk of the tax breaks.
      Sad isn’t. Also, how is it most of the population that produces and creates wealth is in debt to banks that simply create money out of thin air (89% of every bank loan is new money), and even earn interest on money printed out of thin air?
      Another name for the fair tax is greed.
      Absolutely. The current tax system is severely flawed too. Too many tax loop holes allow the wealthy to avoid paying an equal percentage (as evidence by Warren Buffet who pays a lower income tax rate than a middle-income secretary making $60K annually).
      Greed is a disease that gets progressively worse over time if it is left untreated and it has been left untreated so long that we may not recover from it without an extremely painful operation.
      Yes. Greed and laziness (complacency and apathy). You’re right, there will eventually be painful consequences for so much fiscal irresponsibility for so many decades. The solution is built-in. It is the painful consequences. Too bad we have to repeatedly learn the hard, painful way.
      d.a.n., good to see your postings again. I think Flat Taxers will need to heed David’s warning in his excellent article for the flat tax plan to get its due with the American people.
      Thanks! Yes, David makes many good points. We should look closely at who is supporting the 30% Sales Tax. The thing about any flat income tax rate is that it must be as small as possible. As Craig Holmes said above, any tax, if too large, will result in tax evasion. The current tax system was so perverted that it had a 90% tax ceiling at one time. This sort of perversion fueled other perversions. Thus, a myriad of tax-loopholes arose. Now the rich and their bought-and-paid-for incumbent puppets like the abused tax system the way they have perverted it. That’s why, even now, they aren’t so sure about a 30% Sales Tax. The perverted tax system they have now is probably better as long as they have so many tax loop holes.

      Some will say a 17% income tax with no tax for anyone on income below the poverty level (and all tax deductions) won’t produce enough revenues. However, roughly based on $13.5 Trillion GDP, 17% of that is $2.3 Trillion. That should be more than enough. Some cuts in federal waste, pork-barrel, and graft could make up for the difference. Seriously, $2.3 Trillion ought to be more than enough. In fact, I’d love to see the 17% tax rate reduced ASAP after the 77 million baby boomer bubble passes. No one else is proposing anything as low as 17%. The only way a rate as low as 17% could work is by also removing all of the tax loopholes. Otherwise, the wealthy still evade taxation. BTW, I’ve heard many wealthy people freely admit that they are paying a lower percentage of income to taxes than most people in the middle class. Some people in the Middle Class are paying over 40% in income taxes (e.g. 15.3% for Social Security and Medicare + 25% income tax). This is oppressive. Personally, 17% is too high, but we have the 77 million baby boomers, a $9 Trillion National Debt, Social Security is $12.8 Trillion in debt, and the PBGC is $450 billion in the hole. Unfortunately, it seems 17% would be required for a while, but it could be lowered to 14% after the 77 million baby boomer bubble passes. I’d much rather pay a 14% flat income tax (only on income above the poverty level) than a 30% Sales Tax. I think most would.

      Also, unless we fix the corrupt, dishonest excessive money-printing monetary system, there’s really no reason to tax at all.

      Actually, some will say the only reason for taxation is to redistrubute wealth. Well, at the moment, wealth is being redistributed to the wealthy. The HAVEs are winning. The HAVE NOTs are losing, as evidenced by the 1% that had 20% of all wealth in 1980 and now have 40% of all wealth in 2007. Such a massive 30% Sales Tax will make the wealthy wealthier. Imagine no taxes on their capital gains and interest earned. What a windfall that will be. I can see why the 30% Sales Tax has such a large following among bought-and-paid-for politicians who we already know only carry the water for their big money donors. Not the voters. The voters are to be used and abused. And unfortunately, the majority of voters allow it; even reward it.

      Flat Tax sounds ..well flat or fat or fart or well Fair, to easily manipulated by others. In that vein I propose a name change to help with the salesmanship, lets see Fair Tax is already spoken for so perhaps “Most Fair” or “Even more than Fair”, nah how about “Fairest Tax Plan” or “Fair for everyone not just the wealthy tax plan”. Nah, lets see “Fairest of them all tax plan”, nah sounds like a fairy tale, “Fairer than Fair tax plan”, well ..nevermind. Lets try Freedom Tax plan or ..well perhaps Flat will work after all.
      Funny! They should call it the “Bend-Over” tax plan, since that is essentially what middle-class and poor will be doing if a 30% Sales Tax is ever passed.
      Rhinehold Im not following you when you make statements such as: “You currently pay that 30% sales tax already on every new home you buy … So, if now a new house cost you 150,000, after the Fair Tax plan is enacted it will still cost 150,000 (tax included).
      Me too. Also, watch out for those “hidden” taxes. Of course, you can not know exactly what they are, because they are hidden.
    • Posted by: d.a.n at September 2, 2007 01:23 PM
      Comment #231505
      I’m not a Guiliani fan, but he’s right about this.

      No he’s not because he makes the statement ‘who is going to administer who is exempted from the sales tax’. He shows he hasn’t read the book because the answer is NO ONE. There are no exceptions.

      Again, the product or service that is $500 will still be $500 (tax included). So where is the extra money they will be spending? Not true. With a 30% Sales Tax, if the PRICE is $385, then the 30% Sales Tax makes the total $500. With a 30% Sales Tax, if the PRICE is $500, then the 30% Sales Tax makes the total $650.

      Except the product now does not include the hidden taxes, therefore the product price would drop the 23% inclusive, add on the 30% exclusive sales tax, and you get the SAME AMOUNT being paid for the product.

      The flat tax doesn’t ….

      So, let me get this straight. You don’t tax the poor, you don’t tax corporations. Who do you tax then at only 17%?

      It seems to *ME* that you are targetting the middle class here, DAN. Where is they study that tells me that the 17% flat tax that only taxes the wealthy at 17% and the middle class at 17% will be revenue neutral?

      Someone said that the Fair Tax people say you will be paying less in taxes. That is patently not true. You will be paying less in INCOME taxes, yes, as in none. But the end result is the same, the revenue to the government will be the same, only NOW you will be able to see how much you are paying in taxes as it will be TRANSPARENT unlike what we currently have.

      And since dan likes to throw up his link of his personal ‘pros and cons’, I’ll keep making sure to put a link to mine every time he does.

      A comparison of the FairTax vs FlatTax proposals

      Posted by: Rhinehold at September 2, 2007 01:30 PM
      Comment #231510

      Rhinehold, The Flat Tax you compare to in your link is not the 17% Income Tax system. If I recall, that Flat Tax (of Dick Armey’s) is something like a 27% income tax. It is far too high too. The advantage of the 17% Income Tax is that it raises sufficient revenues and taxes at a much lower rate than all of the other plans. And if that’s not enough, I suggest government learn to cut some wasteful spending and pork-barrel.

      Again, what are these hidden taxes? Is it a secret?

      Posted by: d.a.n at September 2, 2007 02:12 PM
      Comment #231512

      An equal rate is not a fair rate. To be fair, the burden has to fall according to the effect it will have on the taxpayer.

      Equal rates will not have equal effects across income brackets. Moreover, many proposals have exemptions for the first few tens of thousands of dollars of income, and that really cancels out any claims that the rates are equal to begin with.

      It also makes the tax a de facto progressive tax, and for the same reasons: the effects that a tax will have at a given rate are not equal across all incomes. The lower your socioeconomic status, the more it costs of the money you have simply to get buy, to maintain your position.

      It’s a common rhetorical tactic to say that people will pay less taxes and lower rates, but that’s only if you disregard the issue of revenue neutrality. Too gather the same amount of money, the rate of any tax is going to be higher, and that higher rate will hit people with a heavier burden at a lower income by the nature of the tax’s structure itself

      This whole thing seems to be more ideological than economical. This is about those people who blame taxes for a loss income that in the past few decades has had more to do with labor policy and wage suppression at the top, than the drainage of taxes by the government. If your boss doesn’t pay you overtime because of some cute labor law rewrite that they got the Republicans to give them, no amount of tax cuts is going to give you that money back.

      For the most part, economic stimulus by tax cuts has failed to live up to its promise. Mostly the economy stimulates itself. You don’t really have to tell people to buy food and other things. You don’t really have to tell people to try and make more money.

      It’s the emphasis on using the tax code to encourage and discourage behavior, rather than direct regulation or intervention that has lead to the overwhelming complexity of the tax system, not its progressive structure.

      As for Article V conventions? Unless we’re talking about a certain number of states calling for them all at once, there’s no clear indication Congress has to do crap. There’s no indication that the Founding Fathers practiced that kind of constitutional call, nor that the original constitutional conventions and ratifications occured over such a period.

      Article V conventions are for when the vast majority of the states want, all at once, a radical change to the constitution. There is no such clear movement underway involving such a profound majority. Until there is, there’s really no point in it, because it was designed to be difficult to call, because of the vast potential for civil unrest should a minor majority, or a persistent minority succeed in calling it.

      Posted by: Stephen Daugherty at September 2, 2007 02:35 PM
      Comment #231517
      Who do you tax then at only 17%?
    • Everyone pays 17% income tax ONLY on income above N x Poverty_Level (e.g. 1.0 x $12K; N >= 1.0).
    • No one pays tax on income below the N x Poverty_Level.
    • EXAMPLE: Given:
      (1) a flat income tax of 17% ,
      (2) and a poverty level of $12K ,
      (3) and an N factor of 1.5
      (4) therefore, low-income-exemption-level is 1.5 x $12K = $18K
      (5) and six persons with different gross incomes (K=$Thousand):

        A earned $15K per year
        B earned $20K per year
        C earned $30K per year
        D earned $100K per year
        E earned $200K per year
        F earned $400K per year
        G earned $900K per year
        H earned $9M per year (M = $Million)
      A tax = $0 =0.17 x ($0) = 0% of $15K = 17% of ($0) ; since $15K £ $18K
      B tax = $340 =0.17 x ($20K-$18K) = 1.7% of $20K = 17% of ($20K-$18K)
      C tax = $2,040 =0.17 x ($40K-$18K) = 6.8% of $30K = 17% of ($30K-$18K)
      D tax = $13,940 =0.17 x ($100K-$18K) = 13.9% of $100K = 17% of ($100K-$18K)
      E tax = $30,940 =0.17 x ($200K-$18K) = 15.5% of $200K = 17% of ($200K-$18K)
      F tax = $64,940 =0.17 x ($400K-$18K) = 16.2% of $400K = 17% of ($400K-$18K)
      G tax = $149,940 =0.17 x ($900K-$18K) = 16.7% of $900K = 17% of ($900K-$18K)
      H tax = $1,526,940 =0.17 x ($9M-$18K) = 16.97% of $9M = 17% of ($9M-$18K)

      There is no sense in taxing income below the poverty level, and is far more simple than an over-complicated pre-bate system. A pre-bate system will be susceptible to fraud and abuse, as is any system in which the government is the guarantor of payment. It’s better to simply not tax income below the poverty level (for everyone). When someone makes $1 million, not taxing the comparatively miniscule amount below the poverty level is insignificant. However, as incomes decrease, the elimination of the tax on income below the poverty level becomes more significant and decreases the overall tax percentage. For instance (above), a person making $25K and only paying tax above the $18K limit essentially only pays an income tax rate of only 4.76% . This is the pre-bate in reverse, but more efficient since it simply does not collect tax on income below the threshold (versus the pre-bate which sends everyone a check regardless).

      About that pre-bate. Would people that are not working don’t even work receive a pre-bate? The pre-bate raises lots of questions. It seems far smarter to simply not tax income below the poverty level. That is a simple thing to determine, since employers already report the income to the IRS.

      And this won’t create double-taxation that would occur with the 30% Sales Tax (i.e. FairTax) as a result of now paying a 30% Sales tax on money that was already previously taxed by the previous income tax system. That will be a hard pill to swallow that tax payers are unlikely to tolerate.

      It seems to *ME* that you are targetting the middle class here, DAN.
      Not true. A percentage is fair. Some progressive tax proponents like higher percentages for the wealthy. Is that what you are suggesting is more fair than a flat percentage? How that helps the 30% Sale Tax argument is a mystery.

      First, you say people are trying to “soak the rich”. Now you say people are trying to target the middle class? Next thing you know, we’ll also be accused of raping and pillaging the poor, eh?

      Where is they study that tells me that the 17% flat tax that only taxes the wealthy at 17% and the middle class at 17% will be revenue neutral?

      As for federal revenues, 17% is more than enough, IF all tax loop holes are eliminated. Otherwise, the wealthy will continue to evade paying 17% on their gross income. 17% of the $13.5 Trillion GDP is 2.3 Trillion. This is way more than enough for the federal government. And if it isn’t, then the federal government should cut some pork-barrel and waste.

      17% is quite plausible based on only a 15% tax rate on capital gains, eh? A percentage is fair by virtue of ratios. 17% tax on $100K (above the poverty level) is twice as much tax as 17% tax on $50K (above the poverty level).

      You don’t tax the poor, you don’t tax corporations.
      Why tax the poor? You can’t get blood out of a turnip, and that will simply drive them onto welfare unnecessarily; wasting all tax payers money with the additional bureaucracy? The pre-bate seems quite likely to increase bureaucratic red-tape and inefficiencies.

      Why tax corporations? They just pass those costs along to consumers. However, this is not a free pass for corporations to use and abuse. This does not mean corporations can freely exploit natural resources or pollute the environment. Those are separate law enforcement issues.

      The only aspect of a 30% Sales Tax that could possibly have a positive effect is that it would encourage saving, since a 30% Sales Tax would be so painful.

      The thing is, it doesn’t matter which end (or middle) of the balloon you squeeze. It simply swells somewhere else (or pops, if abused enough).

      I doubt Americans will ever go for such a high 30% Sales Tax, and getting the 16th Amendment repealed won’t be easy. Especially since politicians and their big-money-donor puppeteers like current abused system just fine. They are gaining now. Why change? The wealthy are getting wealthier. 40% of all wealth now belongs to 1% of the population (up from 20% in 1980).

      But, voters are a complacent, apathetic, disinterested lot. So it also would not surprise me if they let themsevles be used and abused some more. It’s a trend, and I think the 30% Sales Tax is part of that trend. If voters allow it, they’ll get what they deserve. They already have the government they deserve (even reward).

      Again, there’s not much point in getting so bent out of shape about something that is extremely unlikely to happen anyway. Congress ain’t gonna ever allow any common-sense, no-brainer reforms or risky changes that may reduce their power, reduce their opportunities for self-gain, reduce the security of their cu$hy incumbencies, or upset their big-money-donor puppeteers.

      Posted by: d.a.n at September 2, 2007 03:11 PM
      Comment #231519
      As for Article V conventions? Unless we’re talking about a certain number of states calling for them all at once, there’s no clear indication Congress has to do crap.
      There are no time limits on Article V.
        Article V of the U.S. Constitution: The Congress, whenever two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, or, on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress; provided that no amendment which may be made prior to the year one thousand eight hundred and eight shall in any manner affect the first and fourth clauses in the ninth section of the first article; and that no state, without its consent, shall be deprived of its equal suffrage in the Senate.

      There have been 567 requests to make amendments by ALL 50 states. All but three of the applications were made between 1900 and 1992, and over half were made between 1960 and 1992.

      So, how many amendments does it take?
      Clearly, Congress has a conflict of interest.
      They can simply veto the text with the excuse that all states must apply simultaneously?
      How convenient, since that’s unlikely (if not impossible). It’s funny how some people defend the Constitution, but only the parts they like.

      So, which tax system do you prefer?
      (1) the current tax system (progressive, but full of tax loop holes making it regressive)?
      (2) the 30% Sale Tax with prebates?
      (3) a 17% income tax with no taxes by anyone on income below the poverty level, and the elimination of all tax loop holes?
      (4) or simply eliminate all of the current tax loopholes?
      (5) other?

      I’ll give Rhinehold one thing. At least he is suggesting some sort of solution (even if I don’t agree with it).

      Posted by: d.a.n at September 2, 2007 03:29 PM
      Comment #231521
      whenever two thirds of both houses shall deem it necessary

      This would appear to mean two thirds at the same time, otherwise it’s useless. Same with the next phrase.

      Posted by: womanmarine at September 2, 2007 04:25 PM
      Comment #231522

      Loyal Opp asked: “And what, pray tell, is the neocon position on tax policy and government borrowing?”

      Supporters of the Bush Administration’s policies and Congress’ spending growth in national debt since 2001, who argue national debt doesn’t matter if its percentage of GDP remains below that attained in WWII. Their reasoning is that since we grew our way out from under the WWII debt, such lofty levels of debt are of little concern.

      But, the 21st century context for debt is NOT what it was in the mid-20th century. Two contexts have changed which invalidate their argument. First, ours is no longer a commodity backed currency, like gold collateralization for the printing of money. Second, is that in the 1950’s America’s productive capacity had only just begun to be tapped. Today, America’s productive capacity has virtually peaked, seriously limiting the potential of growing our way out of our national debt.

      Ben Bernanke and Alan Greenspan have both agreed that growing the economy is not a viable solution to our increasing debt levels and spending. The Bush Administration and the Congress that supported his debt laden budgets have acted in ignorance of these all important differences and Bernanke’s and Greenspan’s admonitions.

      Posted by: David R. Remer at September 2, 2007 04:28 PM
      Comment #231525

      tomd said: “Point them out as I have with your agenda to soak the rich.”

      Again, your comment is illogical. I have stated my support for a flat tax which would lower taxes for the wealthy over what they paid under the last Democrat controlled government. How can my position possibly be construed as an agenda to soak the rich? If I advocated for the current system, your comment above would potentially have merit.

      Posted by: David R. Remer at September 2, 2007 04:38 PM
      Comment #231528

      Rhinehold said to d.a.n.: “You keep leaving out that the hidden 30% tax on these products that we already pay NOW will no longer be there in these ‘calculations’.”

      Rhinehold, and you keep leaving out that the under our current system, estate taxes, AMT, corporate, and capital gains taxes underwrite a significant portion of the government’s need for revenues, whereas under the UnFair Tax plan, the folks paying these taxes suddenly don’t pay them, or see their rates drop precipitously, which by any logic, translates into a shift of the revenues to citizens of far less affluence. If the revenue requirement is constant, and the wealthy pay substantially less of it (which they will under the UnFair Tax plan), the math dictates irrefutably that the citizens of lesser means will make up the difference.

      There simply is no logical way around this. D.a.n. is absolutely right, the middle and lower classes get hammered by an increased burden of making up for revenues no longer acquired from the wealthiest and business corporations who are exempt from a large portion of the taxes they now incur.

      Posted by: David R. Remer at September 2, 2007 05:12 PM
      Comment #231529
      This would appear to mean two thirds at the same time, otherwise it’s useless. Same with the next phrase.
      Appear? Article V states “when” and no where does it say “at the same time”.
      … otherwise it’s useless. Same with the next phrase.
      Yes, it is useless, and voters have the government that they deserve as long as most voters are so willing to give up their rights, despite the state legislatures of all 50 states have made 567 requests to make amendments (11.34 per state on average), all but three of 567 requests bewteen 1900 and 1992 (6.13 per year), and over half since 1960 (6.03 per year). Getting two thirds of all states to do it simultaneously is almost as bad as herding cats. But there is a group trying to get the states to apply again all simultaneously. Because up to now, all 567 requests by all 50 state legislatures have been ignored. If two thirds of the states are willing to re-apply simultaneously, then we will see if Congress will obey the Constitution.

      So it has to be simultaneous, eh?
      Within the same Year? Month? Week? Day? Hour? Minute?
      In the absence of a definite time limit, shouldn’t it err on the side of the states?

      With such a strict interpretation of Article V, it is useless. Good luck ever getting any amendments and reforms passed. Congress won’t ever allow any reforms that might reduce their power, reduce their opportunities for self-gain, or reduce the security of their cu$hy incumbencies.

      Posted by: d.a.n at September 2, 2007 05:23 PM
      Comment #231532

      d.a.n. said: “Congress won’t ever allow any reforms that might reduce their power, reduce their opportunities for self-gain, or reduce the security of their cu$hy incumbencies.”

      Unless forced to by the voters as a condition for receiving their vote. If voters make a habit of voting for challengers instead of incumbents in response to Congress’ lacking performance, the challengers will get the message, clean up Congress’ act, or they too will be a one term politician.

      That is how the voters can take back government for the people, by the people.

      Posted by: David R. Remer at September 2, 2007 06:24 PM
      Comment #231534
      I doubt Americans will ever go for such a high 30% Sales Tax

      They are already paying it now. If making it transparent causes people to revolt, then the only reason they aren’t now is because they are being swindled by their rulers.

      There simply is no logical way around this. D.a.n. is absolutely right, the middle and lower classes get hammered by an increased burden of making up for revenues no longer acquired from the wealthiest and business corporations who are exempt from a large portion of the taxes they now incur.

      Sorry, but you’re just plain wrong, David. I’ve shown charts, studies and other kinds of evidence to the contrary but still you prefer your ‘logic’ which defies the evidence, and refuse to be swayed. It’s just not going to change no matter how much we go around and around.

      BTW, I don’t understand why you are supporting the flat tax plan of DAN’s that lets corporations off of the hook and lowers the upper income tax bracket to 17%, and elminating all taxes on the poor and then say that the FAIR TAX plan is the one that is going to squeeze the middle class. Talk about ‘illogical’.

      Of course, that’s unless we take into account you knowing that as long as their is taxation based on income, identification of income levels can still be done, and then we can go right back to a progressive tax plan in the future in order to meet your goals of wealth redistribution.

      Not true. A percentage is fair. Some progressive tax proponents like higher percentages for the wealthy. Is that what you are suggesting is more fair than a flat percentage? How that helps the 30% Sale Tax argument is a mystery. First, you say people are trying to “soak the rich”. Now you say people are trying to target the middle class? Next thing you know, we’ll also be accused of raping and pillaging the poor, eh?

      Not at all, you just don’t read what I write. I was pointing out that those who like the current plan, the ones that believe the income tax code should be manipulated for poltical reasons, and for wealth redistribution, people like David, are not going to like that you are doing the same thing that they are railing about the FairTax for.

      In your plan, the hidden taxes are gone, the poor are no longer taxed and the rich pay less income tax. That leave the middle class to shoulder the load. And you even agree that the numbers will never add up to revenue neutrality, so under your plan government programs WILL be cut.

      And people say that the Fair Tax plan isn’t fair.

      Under my plan income is no longer an issue. Everyone is allowed to purchase new goods tax free up to the poverty level. After that, it all depends on how you choose to spend your money, the money you earn, on the goods and services that you buy. The federal taxation is suppose to pay for these services that the federal government provides, yet with an income tax it didn’t matter how many or how few of these services you used. By taxing the products and services that benefit from using these services, you are paying what you use. It will also make sure that visitors to the country pay for the products and services that THEY use, instead of using them without paying for them as their income is no longer here. AND, further, more people of wealth will chose to live in the US instead of leaving to lower taxation countries.

      Taxation on income is, IMO, simply evil. In David’s mind, NOT taxing based on income is evil. I doubt that we would ever agree or convince the other to budge based on those views. I don’t think you should pay more taxation or be forced to pay charity against your will. David believes it is the government’s duty to take the compensation for your work and give it to people who have less wealth.

      For me, the only moral taxation method would be a taxy system based on user fees directly related to the goods or services you benefit from. This is the closest thing to that system around atm.

      But back to my point, the middle class would be less ‘hammered’ under this plan than the flat tax plan OR the current plan simply because of the nature of people to spend their money. Rich people will more than likely buy new where the middle class may decide to go with used in order to save some of their income. At least they would be given a choice at any rate. When the taxation is done before they ever see their income they have no choice at all. And personally, I’m pro choice.

      Posted by: Rhinehold at September 2, 2007 06:33 PM
      Comment #231535

      Two of my favorites arguements for the “Fair Tax” just have to be these;
      “Those of you who are complaining about the FairTax Plan obviously either haven’t read the plan or have an agenda against the rich.”
      and of course;
      “This article REALLY shows your agenda to soak the rich.”
      because when I hear this;
      “But the wealthy (especially the hyperwealthy) can’t even remotely spend all their income. Their income grows and grows. They earn lots of interest that is currently taxed at a rate lower than the average person pays. That is, Warren Buffet paid a lower percentage of income tax than a secretary making $60K annually, because capital gains are taxed at 15%.”
      it pretty much makes the first 2 statements sound like complete foolishness.
      It would appear that the “Fair Tax” is the choice of tax methods for the rich. Will they never quit complaining about paying their fair share? The current tax code has been manipulated to favor the uber wealthy yet that doesnt seem to be good enough for these wealthy people and their mouthpeices. They certainly dont mind reaping the benefits of the United States but are the first to withold their money to keep the Country running. Afterall the recent bout of deregulation of everything sure didnt help the middle class nor did it help the poor. Yet still they whine, complain,use every tax dodge available to not pay their fair share, and now start a “grassroots movement” to continue to shift the burden to those in the lower economic classes. Once again they fool the libertarians and the far right with rhetoric and subject the rest of us to the whining “soak the rich” comments.
      Lets face facts no one likes to pay taxes yet we dont want the government to run the businesses in this Country. But its time for the wealthy to be held accountable and pay their fair share and it wont happen with the National Sales Tax IMHO.

      Posted by: j2t2 at September 2, 2007 06:48 PM
      Comment #231537

      Rhinehold said: “David. I’ve shown charts, studies and other kinds of evidence to the contrary but still you prefer your logic which defies the evidence, and refuse to be swayed.”

      Therein lies the problem, Rhinehold. Evidence which is inherently illogical is not evidence. There is ONLY one set of rules for LOGIC, Rhinehold, and I suggest you read up on them. There is no such thing as ‘my’ logic or ‘your’ logic. There is just logic, a finite and very specifically defined set of rules which, if complied with, result in valid conclusions following valid premises.

      Corporations will not be taxed in the “Fair Tax” plan. The wealthy will pay tax only on what they purchase, and not on income, investments, or investment earnings. These premises are agreed as true and valid. Given constancy in revenue receipts, it is a logical and valid conclusion that the revenues NOW received by corporations and wealthy income not spent, investments and investment earnings, MUST be received by non-corporate and non-wealthy persons if revenue receipts are to remain equal and constant.

      There is no refuting the logic, Rhinehold. Your evidence is an attempt to hide this valid, true, and logical consequence of the premises the UnFair Tax plan provides.

      In short, the UnFair tax plan is merely a plan to transfer the burden of taxes now born by wealthy entities to non-wealthy entities.

      Posted by: David R. Remer at September 2, 2007 06:56 PM
      Comment #231538

      j2t2,

      I have two questions for you:

      1. Have you read HR25?

      2. Given the scenereo above with Warren Buffet paying less taxes than his secretary, would you support a tax plan that would lower both of their taxes?

      Posted by: tomd at September 2, 2007 06:57 PM
      Comment #231542

      j2t2, you got it. It is indeed a plan to transfer the burden of taxes now paid by the wealthy and business interests to the consumers in our society, the vast majority of whom are NOT wealthy.

      That’s it in a nutshell.

      Posted by: David R. Remer at September 2, 2007 07:05 PM
      Comment #231543

      tomd asked: “. Given the scenereo above with Warren Buffet paying less taxes than his secretary, would you support a tax plan that would lower both of their taxes?”

      That is not possible IF total revenues to the federal government are to remain the same which the UnFair Tax proponents claim it will. Given the premises, no plan could achieve lower taxes for all without lowering government revenues. Are the UnFair Tax proponents lying about revenue neutrality? If not, then your scenario is logically not possible.

      Posted by: David R. Remer at September 2, 2007 07:10 PM
      Comment #231545

      tomd,
      1.Are you suggesting that the info on the “Fair Tax” website is inaccurate and misleading,such that only HR25 should be read?
      2. If it sounds to good to be true…

      Posted by: j2t2 at September 2, 2007 07:34 PM
      Comment #231550

      David,

      merely a plan to transfer the burden of taxes now born by wealthy entities to non-wealthy entities

      1) The burden you speak of that is ‘corporate’ taxation is already going to the non-wealthy in the price of every product. All this plan does is acknowledge that and let every person who buys something know what tax they are paying on it, not hiding it in the ‘cost’ of the product.

      2) Why are you supporting the flat tax plan that d.a.n. is touting if you are against hammering the middle class and/or lowering the tax burden on the wealthy?

      BTW, where on the fairtax.org page does it say that people will be paying less taxes (other then admitting that they will be paying less LIFETIME taxation because of the prebates?)

      Posted by: Rhinehold at September 2, 2007 08:09 PM
      Comment #231553

      OK! So all y’all that are supporting the ‘Fair Tax’ manage to get Congress to pass it. I have one question for ya.
      What’s to keep Congress from reinstating the Income Tax a year or two later? That is if they even do repeal it in the first place. And don’t even try to tell me that the current bunch of corrupt and irresponsible politicians up there in DC won’t pull a trick like that.
      The 16th Amendment allows for it and the only way to make sure it don’t happen is to get it repealed and make Income Tax unconstitutional. And that aint gonna happen anytime real soon. Not with the bunch that’s currently in Congress.
      So now we’d have the ‘Fair Tax’ and Income Tax to pay. It looks to me like y’all are just playing into the hands of our current crop of corrupt and irresponsible politicians up there in DC and giving them more of your hard earned money to waste.
      I’ll be willing to bet that most (99.9%)of that DC crowd do want a national sales tax even though they won’t admit it. And have no intention of doing away with income tax.

      Posted by: Ron Brown at September 2, 2007 08:17 PM
      Comment #231554

      “tomd,
      1.Are you suggesting that the info on the “Fair Tax” website is inaccurate and misleading,such that only HR25 should be read?
      2. If it sounds to good to be true…”

      1. I’m not suggesting anything. I asked if you read HR25. HR25 is the bill as presented to congress. Have you read it?

      2. I don’t understand this response. Would you support a tax plan that lowered Warren Buffet’s taxes as well as his secretary?


      Posted by: tomd at September 2, 2007 08:23 PM
      Comment #231555

      Rhinehold, your statement is false on its face. If in fact, corporations passed on all their costs of doing business to the consumer, they could not remain competitive with other companies with lower costs of doing business. We just saw an extended period in which airlines incurred dramatically higher fuel costs but, DID NOT pass the cost on to consumers.

      With companies like Exxon/Mobil reaping historical records of profitability, if given the choice of passing taxes on to the consumers making their product less price competitive or keeping the costs competitive and reducing their profits, they would and will accept the reduction in profitability. Losing market share in the future is a far more costly option than reducing today’s profitability.

      So, no. Your argument does not hold up that corporations pass all costs of doing business including taxes on to the consumer. Not as long as they operate in a competitive marketplace for market share.

      I am for the flat tax because by and overwhelming majority it is the most democratic form of taxation as evidenced by the majority of Americans perception that if everyone pays the same percentage of tax on income, it is inherently more fair than some paying higher or lower rates of taxes.

      The Flat Tax plan is the true Fair tax plan, as it favors no socio-economic group over another, save those who would be driven into or held in poverty by it.

      Posted by: David R. Remer at September 2, 2007 08:24 PM
      Comment #231557

      “OK! So all y’all that are supporting the ‘Fair Tax’ manage to get Congress to pass it. I have one question for ya.
      What’s to keep Congress from reinstating the Income Tax a year or two later?”

      My first fear also Ron. The 16th amendant would have to be repealed BEFORE the FairTax goes into effect.

      Posted by: tomd at September 2, 2007 08:29 PM
      Comment #231558
      What’s to keep Congress from reinstating the Income Tax a year or two later?

      The Fair Tax, by code, can not take effect until the 16th Amendment has been repealed.

      Posted by: Rhinehold at September 2, 2007 08:30 PM
      Comment #231559
      We just saw an extended period in which airlines incurred dramatically higher fuel costs but, DID NOT pass the cost on to consumers.

      You’re comparing a short term operating expense increase with a long term operating expense?

      Come on David, you can say that what I say is ‘false’ all you want, but with comparisons like this that are suppose to counter the millions of dollars of studies by respected economists… well, it makes you sound like an anti-global warming nut.

      Posted by: Rhinehold at September 2, 2007 08:32 PM
      Comment #231560
      The FairTax improves progressivity of the federal tax system. In your letter you stated that the FairTax may unintentionally shift the tax burden from one group of taxpayers to another. Most recently, noted public finance economist, Laurence Kotlikoff of Boston University, has completed comprehensive research on the distributional aspects of the FairTax. His research demonstrates that the FairTax lowers marginal tax rates on work and saving, cuts remaining average lifetime tax rates, and enhances overall progressivity. This occurs because the reduction in these tax rates is proportionately much greater at the low end of the earnings distribution than at the high end. Consider a middle-aged couple with two children earning $20,000 per year compared to that same couple earning $500,000 per year. In switching to the FairTax, the low-income couple’s remaining average lifetime tax rate is only 1.5 percent versus 11.0 percent under the current system. The high-income couple’s rate is 20.5 percent versus 35.6 percent under the current system. The low-income couple gets an 86 percent cut in its average remaining lifetime tax rate, whereas the high-income couple gets a 42 percent cut. That same couple earning $70,000 would see their tax rate drop from 21.3 percent to 11.6 percent, a decline of 46 percent.

      Backed up by http://people.bu.edu/kotlikoff/Comparing%20Average%20and%20Marginal%20Tax%20Rates%2010-17-06.pdf

      David, if you want to support the flat tax because you continue to believe that taxing income is better than taxing consumption and a flat tax is the only way to ‘flatten’ it, then fine by me. Please continue to do so. But then don’t turn around and tell me that the Fair tax is going to ‘hammer the middle class’ when the it doesn’t hold a candle to how much the middle class will get the majority of the tax burden with the flat tax plan that can in no way achieve revenue neutrality.

      Posted by: Rhinehold at September 2, 2007 08:37 PM
      Comment #231562

      Rhinehold said: “You’re comparing a short term operating expense increase with a long term operating expense?”

      You are not addressing market share and competitive markets as long term pressures on refraining from passing all costs to consumers. You are not debating well when you ignore the salient points of another’s argument.

      Read Thomas Friedman’s book, The World is Flat for an excellent elucidation on the argument I make, Rhinehold. Friedman is a conservative. There is a global marketplace of competition for market share taking place which invalidates your argument. These are long term pressures on business to refrain from passing all costs of doing business on to the consumer in lieu of remaining competitive for market share. The Big Three Autos failed to recognize this paradigm shift, and Toyota has taken over as the largest auto manufacturer from GM.

      GM wanted their cake and eat it to, as you suggest, keeping profit margins high passing all costs to the consumer. That was back in the 1980’s. By 2002, they were giving away profits in order to try to keep market share, but, it was too little too late. GM’s actions in the 1980’s was what Toyota needed to catapult themselves to displacing GM as the largest auto maker in 2007.

      It doesn’t get longer term than that Rhinehold in the business world. Your argument is false on its face.

      Posted by: David R. Remer at September 2, 2007 08:41 PM
      Comment #231563

      Rhinehold quoted: “Most recently, noted public finance economist, Laurence Kotlikoff of Boston University”

      As long as you are going to keep trotting out this one lonely source to make your case, I am going to ignore it. Show me his statistics and methodology for arriving at his conclusions, and then we can debate. You accept his Ph.D without questioning the authority of his work. Always a bad practice.

      His work is motivated by and focused on trying to make a defensible case for shifting the burden of taxes off investors and producers and on to consumers, the vast majority of whom are NOT wealthy. I have demonstrated this by a pure process of logical deduction which is irrefutable.

      This article is not about the Flat tax. If you want to debate the flat tax plan, write an article about it. I will be happy to research it and debate it with you. But, trying to change the topic is not going to defend your indefensible position on the UnFair Tax plan.

      Posted by: David R. Remer at September 2, 2007 08:59 PM
      Comment #231564

      Rhinehold

      The Fair Tax, by code, can not take effect until the 16th Amendment has been repealed

      Then ya might as well kiss your ‘Fair Tax’ goodbye. I don’t see any of the bunch we currently have in Congress voting to repeal anything that Constitutionally gives them the power to tax us to death.
      Also it would take another amendment to repeal the 16th Amendment. When was the last time ya saw an amendment make it through Congress? Even the Civil Rights Amendment couldn’t make it through Congress. Johnson had to sign it into law by Executive Order. And that bunch wasn’t near as corrupt and irresponsible as the bunch we have now.

      Posted by: Ron Brown at September 2, 2007 09:07 PM
      Comment #231565
      You are not addressing market share and competitive markets as long term pressures on refraining from passing all costs to consumers.Yes I have, it is taken account of in the calculations of what imbedded/hidden taxes we pay on every product and service. It is part of the millions of dollars and large number of economists who have done and peer-reviewed.
      You are not debating well when you ignore the salient points of another’s argument.

      You’ve been doing that to me through this whole conversation. You want to counter the numerous points I’ve made about hidden taxation that is supported by a multitude of economists and millions of dollars of research by pointing me to “The World Is Flat”?

      You continue to ridicule me (I’m sure you don’t think you do) by ignoring the numerous points I make and try to pick and choose what you think you can throw back at me then tell me how MY debating techinique is lacking.

      I had a long response prepared but I’m done, you win, transparency and trying to provide a better way of intrusive government out of our lives is obviously not important enough that you’d rather latch onto a non-revenue neutral, hit the middle class hardest tax system. In the end I suppose I just have better things to do with my life than repeatedly hit my head against a wall, especially one that on the outset told me that it was going to be a wall no matter what I did.

      Posted by: Rhinehold at September 2, 2007 09:07 PM
      Comment #231566

      Ron, you’re right. It’s obvious that there is no chance of getting it passed or trying to better our future at all so I’m just going to quit and get on with living my life. I don’t know what I was thinking.

      Posted by: Rhinehold at September 2, 2007 09:09 PM
      Comment #231567

      Also Rhinehold, Congress can edit out the provision requiring repeal of the 16th Amendment then pass the bill. This way they can have both the income tax and a notional sales tax.

      Posted by: Ron Brown at September 2, 2007 09:11 PM
      Comment #231569

      No Rhinehold don’t give up on anything ya believe in.
      If ya ant to see the ‘Fair Tax’ then just quit voting for irresponsible politicians and vote for ones that will listen to the will of the people that put them in office.
      Then ya might get your national sales tax without income tax.

      Posted by: Ron Brown at September 2, 2007 09:16 PM
      Comment #231573
      Ron Brown wrote: … quit voting for irresponsible politicians and vote for ones that will listen to the will of the people …
      Yep. All the many reforms we discuss here endlessly are very unlikely as long as most voters continue to re-elect and reward the very same irresponsible incumbent politicians; giving them a 90% to 95% re-election rate since 1996.

      One way for everyone to be taxed approximately the same percentage of their income with a 30% Sales Tax is if everyone spends all of their income.

      What’s the chance of that?

      Hence, regardless of pre-bates, there is no way mathematically that a person who spends all (or most) of their income will pay less sales tax (as a percentage of income) than a person who does not spend all of their income. That’s a provable fact.

      And with a 30% sales tax, who can afford to save more?

      What income groups are most likely to spend the majority of their income for food, shelter, medical, clothing, transportation (i.e. basics)?

      Who is unlikely to spend all of their income? The wealthy.

      As income decreases, the more likely the entire income is spent just getting by.

      This inescapable fact is problem with any sales tax, much less a huge 30% Sales Tax (i.e. FairTax).

      It is difficult for the wealthy to spend all of their income without simply throwing it away. So it is more likely to grow and grow due to capital gains and interest. Many of the wealthy simply live off of the interest on their savings and investments. Remove the income tax on capital gains, interest income, gifts, and inheritance, and it becomes even harder to spend all of their income.

      For example, a person with a $5 million annual income would have to spend $362,500 per month (after 17% income tax) to spend all of their annual income.

      A person with a $1 million annual income would have to spend $72,500 per month (after 17% income tax) to spend all of their annual income.

      Bill Gates, averaging over $2.1 billion per year for the last 27 years would have to spend $175 million monthly ($5.75 million daily, $239,726 hourly, $3,9995 per minute, $66.6 per second) to spend all of his annual income.

      Still, as Ron Brown said, solutions ain’t likely until voters stop re-electing and rewarding irresponsible incumbent politicians. Government won’t become more repsonsible and accountable until the government does too. Then, who knows … perhaps we can get by on a mere 10% income tax (only on income above the poverty level) and few will have a reason to complain about taxes.

      Posted by: d.a.n at September 2, 2007 10:26 PM
      Comment #231575

      tomd,
      1. Only parts of it. When it scared me for the 5th time I shook my head and said not only no but hell no.

      2. I would prefer a tax system that doesnt starve the beast or my family.

      So say I buy a TV set on a credit card. I now get to pay interest on my taxes? So instead of $500 I can pay interest on $650. Hmmm Yet I will save taxes spread out over my life time. Gosh the credit predators must love this.
      So I want to buy a new vehicle on credit. I get to come up with an extra 6k on a 20k vehicle or finance it for the 3 years so that the IRS won’t know my income. Doesnt sound that good to me. I think there will be a shortage of used vehicles in a few years if this miserable plan beccomes law.
      So every time there is a change to my family status I have a certain time to send in my registration or not get the whatever bate.This is in addition to the yearly registration I will have to send in just to qualify for a whatever bate.
      So I get to keep every receipt for every purchase I make or become responsible for the tax should the seller decide not to pay the tax. Im not seeing a difference in bookkeeping as they would lead me to believe.
      So every unincorporated business, corporation, LLC, association, trust,estate, or other legal entity is now a person except when it comes to paying their fair share unless you are just a natural person. Little to fascist for me unless of course I can incorporate to get the same status as the non natural persons.
      So Art Crafts and Cultural activities are not included in education and training. How far right of you “fair taxers”.

      No tomd the more I read the worse it got. This is a scam and only those with what I consider to be misplaced idelogies would appreciate this and not be able to see it for what it is.
      Let me tell you tomd this will destroy our economy. Who would buy a new vehicle or other large item other than the uber rich. No one I know. The “Fair Tax org” must have given quite a bit of money to have people put there names on these studies because the have major flaws were this fraud to be implemented out in the real world.

      Posted by: j2t2 at September 2, 2007 11:01 PM
      Comment #231578

      dan-
      Should a vote that important by the states happen essentially by accident? That’s what strains credibility for me. A convention should be the result of a decisive turn of America’s political landscape. If the best you can offer is an accumulation that simply happens after years, even decades of mostly random, unrelated calls for a convention, then I really don’t think that qualifies in terms of what the Founding Father’s wanted. At a rate of six on average a year, you’re talking over eight years of votes. Put another way, you’re talking three presidential elections, and two midterms. We saw the height of Republican power and its fall in that time.

      Public opinion can fluctuate a lot in that time. Isn’t it better to capture all the necessary votes within the space of one or two years, so that the convention is neither accidental, nor unwanted by many voters?

      I know you want change, but real change is never going to happen without the cooperation of the voters, and you’re never going to get that playing off of technicalities and trying to sneak reforms past them.

      Posted by: Stephen Daugherty at September 2, 2007 11:32 PM
      Comment #231582

      That was a lot of reading, but very enjoyable. There is one problem I find with both systems of the sales tax and a flat tax, no mater what the percentage. When you say fair, you first have to have a standard defination of it. Now when you people say fair, and a few explained it, it is saying that middle class, and rich both pay the same percentage of their income on taxes, assuming they spend the full amount that they make.

      Now if both of you want to have a system where people below the povery don’t get taxed then I’m assuming again there will have to be something like a standard deduction, or “rebate check”, like there are in both plans.

      Here comes the problem, more so with the 17% plan (although it does not matter what percent it is if you do the math), the “richer” pay more taxes then the “poorer”. Lets say the poveryline is 11000 dollars for a single person(again it doesn’t mater what the poverty line is, as long as there is on, it isn’t fair), that person would pay no taxes/get a rebate check for the tax he spent, again assuming everyone spends all their income.

      Now take a person at 50000 a year, that person would pay 6630 ((50000-11000)*.17). The 11000 is the taking away the standard deduction from the 50,000. The person in reality paid 13.26% (6630/50k) of the income they made, or you can look at it that they got a 22% (11k/50k tax deduction. Now take a person at 100,000 a year. They would pay 15,130 in taxes which is 15.13% of the income they made that year or a 11% tax reduction.

      Please feel free to double check me, but the problem comes that as long as the poor don’t pay (which I don’t want them to) then there is going to be a standard deduction for everyone (if there isn’t then you have to still have a dumb table to look up to see how much taxes you owe if you are just above the povery level).

      It may be a bit differnt for the national sales tax, espically if everyone gets basically a check at the begining of the month for the sales tax of the poverty level, but the beauty of the system is you choose to pay the tax. Mind you I believe in freedom of markets big time, but I believe health is a public good, not a private one, but thats a different issue.

      Posted by: kujo at September 3, 2007 12:17 AM
      Comment #231584

      kujo, you are mixing factors of both plans and getting confused. ONLY the UnFair tax plan proposes a prebate or rebate on necessities. The Flat Tax does not. The Flat Tax requires an income above poverty or multiple of it, BEFORE any income taxes are payable. It is important not to confuse proposals of the two plans. But, the Flat Tax is not the subject of this article. When introducing it, the discusssion gets a whole lot more complicated and confusing.

      Posted by: David R. Remer at September 3, 2007 12:44 AM
      Comment #231585

      Stephen, your argument lacks merit if you consider that ratifications have often spanned multiple election periods. By your logic, if decisions must be made in one election cycle, many of our Amendments are not Constitutional. And there it is, in the Constitution - the absence of any time limit.

      To say there is a time limit is to put words into the Constitution which were never written.

      Posted by: David R. Remer at September 3, 2007 12:47 AM
      Comment #231586

      j2t2, excellent point and hole found in the saleability of the UnFair Tax plan. Credit suddenly takes on a whole different dimension for big ticket items.

      Posted by: David R. Remer at September 3, 2007 12:49 AM
      Comment #231588
      Should a vote that important by the states happen essentially by accident?
      No. If you read Article V literally, it should happen as stated by Article V which does not state a time limit. It simply states “when”. It is open to interpretation, but, in my opinion, until Article V is amended, “when” means when the accumulation of requests by 34 states.

      But I’m well aware of this interpretation. I choose the literal interpretation. Also, and Article V Convention, even if no amendments were ratified by three fourths of all states, would be very beneficial for raising voter awareness, education, and interest.

      Still, FOAVC is working to get two thirds of all states to resubmit one or more of their amendment requests.

      and you’re never going to get that playing off of technicalities
      The literal meaning of the Constitution is not a mere technicality. It deserves a closer analysis.

      If 34 states resubmit (as we hope they will), it will be interesting to see if Do-Nothing Congress will then obey the Constitution. I think one of the amendments should be to clarify what the time-limit is. Clearly, geting 34 of 50 states to do something simultaneously is like herding cats. That requirement may be impossible to meet.

      Posted by: d.a.n at September 3, 2007 01:01 AM
      Comment #231589

      d.a.n., and the consequence of all that incredibly sped up aggregation of wealth in to so few hands is the reinstatement of the robber baron period of the 1900’s which led inexorably to the stock market crash - a result of the working person’s inability to sustain the economy through consumption.

      Henry Ford took this lesson to heart and decided the remedy was to radically raise wages, reduce profits and make his workers consumers of the products he built for sale. Broaden the consumption and demand, and the loss of profits from labor wage increases were more than made up by a dramatic increase in sales on lower profit margins. Thus net profitability was actually increased over time by reducing profitability in the short term, sharing the wealth with labor, while expanding demand and sales.

      Ford was a heretic in his time, but, vindicated as his Ford cars and trucks took the lion’s portion of market share right into the 1950’s. It was in the late 1940’s if memory serves, that Ford Motor co. went to war with the UAW causing Ford to lose market share to GM and Chrysler.

      Posted by: David R. Remer at September 3, 2007 01:02 AM
      Comment #231590

      So Kujo when we all decide to buy only used goods and services what happens to the USG? Who pays to keep the military in Iraq? Afterall it would be foolish to purchase new and tack on 30% wouldnt it. Because as you say the beauty of it is we have a choice. Well if we are forced to buy insurance and tack on the 30% then there goes the freedom of choice. Oh and if we have to buy groceries and tack on the 30% there goes choice out the window. Oh and if we really dont want to sew our own clothes then besides yard sales … man where is all this choice your talking about? Then of course we could get used tires and batteries from the salvage yard instead of .. hey does your mechanic allow you to bring in used stuff to have him install, mine doesnt. But I will still pay him the 30%. But yet we could barter for services say music lessons oh wait barter is covered as services in HS25 isnt it, where are all these choices? When you go see your doctor and you have insurance and the copay is $10 does the insurance pay the 30% on its portion of the bill and you pay 30% on your $10? Do you also pay the 30% on the premium or does your employer. What choice do you have in this other than to not have insurance and pay the 30% on all of it or dont go to the doctor. Some choice. Well you could just refuse to pay , as some do with income taxes, oh wait but then you dont get the groceries do you? But you do have a choice. Please convince me how great my choices are under this plan as I just dont see the beauty of “choice ” being part of the “Fair Tax” scam.

      Posted by: j2t2 at September 3, 2007 01:06 AM
      Comment #231591

      David R. Remer,

      d.a.n., and the consequence of all that incredibly sped up aggregation of wealth in to so few hands is the reinstatement of the robber baron period of the 1900’s which led inexorably to the stock market crash - a result of the working person’s inability to sustain the economy through consumption.

      Yep. And the disparity has never been worse. since the Great Depression. The last time 1% of the population owned 40% of all wealth was during the Great Depression.

      j2t2, Yes. Good point. I had not considered the credit issue. The banks will love it. They already make lots of interest on money created out of thin air.

      Henry Ford took this lesson to heart and decided the remedy was to radically raise wages, reduce profits and make his workers consumers of the products he built for sale.
      Yes, he did. His goal was to make his automobile as affordable as possible.

      But look now. What’s happening to our country? Corruption is rampant and growing. It’s not that our problems, growing in number and severity, are unfixable. It’s that we lack the will.

      j2t2 wrote: Greed is a disease that gets progressively worse over time if it is left untreated and it has been left untreated so long that we may not recover from it without an extremely painful operation.
      I have to agree. It’s not likely to end until the corruption, greed, fiscal irresponsibility, and selfishness finally becomes more painful than honesty and responsibility. The question is, will the patient survive?
    • Posted by: d.a.n at September 3, 2007 01:33 AM
      Comment #231592

      So let me get this straight, If you own a small business, say a fence contractor, and you install a fence for the consumer then you would in fact become an agent for the federal government and become a tax collector. You would be responsible for collecting taxes for the feds as well as installing fences. But there would be a significent reduction in paperwork because well because the “Fair TAx’ people said so. Say you do business in Nevada and the state sales tax is 7.75%, you would now be collecting 37.75% of the cost of the material and 30% of the labor costs. But most of all you would be a tax collector for the feds, forced at the point of a gun to collect taxes even though you may not want to be a tax collector you have no choice… oh I guess you do you can always go out of business. Of course when you are forced to collect the additional 30% from each customer you may not have a choice and be forced out of the new fence business and into the used fence business oh but wait your labor is still a service and you will be a tax collector once again. Some choice. BTW dont you dare be late sending those tax payments in or you could get your choice of prison cells.

      Posted by: j2t2 at September 3, 2007 01:39 AM
      Comment #231593

      Rhinehold said: “I’ve made about hidden taxation that is supported by a multitude of economists”

      You have not refuted my argument and real world demonstration that income taxes are not passed down to the consumer dollar for dollar in a competitive market place.

      If there are multitudes of economists supporting the viability of sales tax as equitable for all socio-economic groups, pray tell, who are they. So far, you have referred to only one, and failed to provide a source for their research, data, and methodologies.

      Sorry, Rhinehold, but, I was raised to question authority, especially when they author counter-intuitive arguments or theses. And a tax plan that eliminates all taxes on corporations and wealthy persons except for personal goods and services consumption, and in the same breath says an equal amount of revenue will be generated by taxing all consumers of all socio-economic classes, is just plain counter-intuitive. If revenue stays the same, what is lost in revenue from the wealthy will have to be picked up by the non-wealthy. The logic is inescapable.

      Moreover, if the wealthy are not taxed on investment earnings and estate taxes, a plutocratic system is inevitable, as is a stranglehold on the economy over time, as ever greater wealth earns ever greater wealth, passed untaxed from generation to generation, ever reducing the dollars circulating in the consumer driven economy.

      The UnFair Tax plan’s suction of circulating dollars at a far faster rate than is now occurring with the progressive income tax, up into capital investments and assets of a small percentage of the population, inevitably leads to another 1929 crash and depression, a result of constriction of dollars for consumption in a top heavy capital accrual class of too few persons.

      D.a.n. has outlined this in detail. The success of America’s economy since WWII is a result of a balance between increasing capital assets available for loans as investments supported by a broad and growing middle class of consumers whose consumption supports the success of new capital ventures. The UnFair Tax plan upsets this balance in a very fundamental way by removing all limits on the affluent class’s accrual of wealth. The Wealth of a Nation for any time period is finite, (Wealth of Nations), and if wealth is not distributed and circulated sufficiently to permit growing consumption, then growth of wealth must also come to an end (1929 stock market crash), since wealth accumulation occurs as a result of the industry of labor which fosters and supports growing consumption by labor, which in turn provides profits for capital owners.

      The UnFair Tax plan leads to unlimited wealth accumulation to the point that too few dollars are available to labor to support the consumption required to return profits to investors in capital ventures. This is what made recovery from the 1929 stock market crash so difficult to recover from, requiring massive government debt and war production to finally end the suffering of labor and their dependents.

      Our current federal debt no longer permits such massive borrowing to resurrect a failed economy as was the case in the 1930’s and 1940’s. This is what makes the national sales tax plan not only illogical, but extremely dangerous to America’s economic future.

      That and the facts that today our economy is already operating at near top levels of productivity, which was NOT the case in the 1930’s when women were an untapped source of labor productivity and immigration posed no problems or costs for a vast undeveloped land area where natural resources would support the growth of new cities and towns.

      Republicans in the 1940’s pushed for a national sales tax, and after much attention and study, it was deemed a regressive tax, and for good reason. The percentage of earnings taxed for the wealthy is dramatically lower than the percentage of earnings taxed for the non-wealthy.

      Nothing has changed. Republicans are still for it. And a national sales tax today would be just as regressive and therefore UNFAIR as in the 1940’s.

      A national sales tax has some upsides and downsides. But, that it is a regressive, and therefore, unfair tax system is a constant over time and history. No honest research or empirical evidence can alter this basic fundamental aspect of sales taxes.

      Posted by: David R. Remer at September 3, 2007 02:05 AM
      Comment #231594

      Yep. It seems to me the paperwork for billions of sales transactions would be harder to monitor and harder to enforce compliance than millions of incomes where the employee has a vested interest in making sure the tax is reported (i.e. a double-entry/double-check of sorts).

      Posted by: d.a.n at September 3, 2007 02:06 AM
      Comment #231599

      tomd, help me out with this plan you seem to think is the way to go.
      So my water, phone,cable,internet, trash and electrical bill will be 30% higher as well as my mortgage payment, insurance,and car payment. Oh and my groceries, gas, prescriptions, and all those little misc. things like oil changes newspaper clothes, gas, kids lunches, etc. But when I look at my pay check stub my social security, medicaid and Federal tax is only 15% of my gross. So I see a problem, it seems cash flow will suffer, so I will be awash in choices but the choices don’t seem to be that pleasant. I will have an additional $750 per month but I will give my consumption taxes, the kind Im told the founding fathers found acceptable, to the tune of $800 +/- depending upon the misc spending during the month. Now if going without electricity, water and the rest is a choice I should be feeling pretty good about now but I just have one of those I ve just been screwed feelings instead. So please explain how I can add insulation, go solar, conserve water , quit watching TV and have more money in my pocket. Great choices. Great choices. So if I go and get a lottery ticket are you gonna want another 30% on that. If I have the neighbor kid cut the lawn for $15 do I have to pay an additional 30% and does he have to send the money to the feds or do I? Or do we both break the law. Seems I can moonlight as a tax collector to .. wait what does that pay? Is alimoney a good or a service and who pays, who collects? Simplifed for who?

      Posted by: j2t2 at September 3, 2007 02:28 AM
      Comment #231600

      j2t2, no problem, you just shift to cash basis fence building, since you don’t have to account for where your income came from, you don’t collect taxes at all from your customers and you can increase your market share by undercutting competitors costs who do collect sales taxes on their new fences.

      See, this is a great idea. Until, the entire nation catches on, and moves to a cash basis economy entirely, then there are no sales tax revenues at all for the government, and we can all enjoy our new found anarchy and incomes without the government ever having been the wiser. :-)

      Posted by: David R. Remer at September 3, 2007 02:35 AM
      Comment #231602

      But David the “Farce Tax” website said compliance will be better under the sales tax plan. Seems they have an agenda and truth is not it.

      Posted by: j2t2 at September 3, 2007 02:41 AM
      Comment #231606

      j2t2, but, like I said at the closing of my article:

      It would be a mistake for current Income Tax reformers and Flat Tax proponents, to underestimate the power of Republican’s salesmanship on this issue. Their grass roots up strategy to promote the national sales tax agenda can be enormously effective. The reason is that it is being sold to voters before they have the opportunity or benefit of counter arguments or debate. Which means by the time this proposal is introduced in Congress for debate, a large segment of the population will have already been sold on the idea, and view protest and debate by Democrats as purely partisan having no merit. It is a brilliant strategy which should not be ignored.

      I have done my bit to insure this strategy is not ignored. I hope, many, many others do the same, especially in Iowa and Florida where the UnFair Tax hired hands are selling it undebated and unquestioned to the voters.

      Posted by: David R. Remer at September 3, 2007 05:46 AM
      Comment #231611

      David R. Remer-
      You’re not getting at the crux of my argument, which is this: unless the calls come together in a relatively contemporary frame of time, or represent a unified political movement, then they do not represent the kind of unity in political will among the states to change the constitution that the large threshold implies.

      We cannot simply, out of context, parse the meaning of the provision in Article V. First and foremost, we should confront the obvious: a new constitutional convention is supposed to function the same as the previous one. It’s an escape clause which allows the writing of a new constitution, essentially, or at least the heavy revision of our current make and model.

      The original constitutional convention required thre quarters of the Colonies to consent, and the founding fathers even went so far as to let the number come to a hundred percent before it was officially adopted. The number necessary for ratification, though, came within nine months, and the call that brought the convention was made only a year or so prior to that convention.

      The speed with which the constitional convention and the ratification take place indicates that the founding fathers believed in acting with a certain amount of haste on the issue, even in a time where such haste was a difficult proposition. With travel time in those days measured in weeks and months, the speed with which they acted is astounding.

      At the end of the day, the states wanted to sign on, and knew what they were signing on for. The people were together on the issue, and it was something debated in common, something on everybody’s minds.

      If you let accidental accumulation become the standard, then you allow conventions to suddenly come into being, with the power to totally overhaul the constitution without Americans in generally having a clear purpose or common sense of urgency in terms of the desired reforms.

      Without that purpose, or sense of urgency, what Americans are left with is a disorganized convention, vulnerable to any strong political force that sees fit to come in and pour money into campaigning for certain amendments.

      No, when we make these kinds of overhauls, it has to be a deliberate decision on the part of the American people, and it has to be some we know we’re doing. America must be behind this kind of change, or else it simply becomes an feeding ground for political opportunists.

      Dan-
      Having said all that I have said to David, let me say this: literal interpretation is not interpretation at all.

      First, if you haven’t noticed, there is no literal provision in our constitution for accepting new states into the union. Would you argue that only the thirteen original colonies should be involved in such a vote? Of course not. That makes no sense. The constitution says nothing about adding new states, but it doesn’t prohibit it either.

      There’s also no literal authority in the constitution for judicial review. However, you would hardly argue in today’s legal world that there is no authority for the courts to do that.

      Not everything in our government is founded on the formal letter of the law in the constitution. There’s a lot of interpretation.

      As well there needs to be. The real world is very complex, and we desire qualities of wisdom and justice in those rulings, not just laws that are technically correct. Additionally the complexity of the real world often bring laws into conflict, and decisions must be made which wisely balance the arguments.

      Your side of this debate uses the technicality of a lack of an explicit time limit to argue for a rather indefinite period of time for constitutional convention calls to bring about that event without having to appeal to a broad base of Americans for it. You could just appeal to and educate Americans first, if you weren’t trying to bring this effort in under the radar.

      You don’t like that there is public resistance to this. However, this is a constitutional Democracy whose constitution was intended to be difficult to change, and where people seeking changes government were supposed to work through persuasive means to gain overwhelming support, before they could bring such events and changes to pass. It’s supposed to be like herding cats; if you succeed, you’ve earned the mandate for that change, for that convention. Otherwise, it doesn’t happen, and really shouldn’t.

      The basis of our political stability and our Democracy’s survival is freedom. We put limits on what political power can do, and what it can change in that true contract between Americans, the Constitution. It’s basically our promise to each other that we mutually limit each others power to gain advantage over the others. That is the basis for our civil order, and it’s worked much better than that in other nations where people of a certain language, race, politics, or religion can impose their will on others excessively.

      In those nations where this mutual disarmament doesn’t happen, you see civil strife. It horrifies us to see people fighting like that, fighting on account of those reasons.

      Even in the midst of our gravest political crises, we rarely see violence erupt.

      The most dangerous aspect of the Bush administration, and I would argue your push to bring about a constitutional convention without getting simultaneous calls for that convention, is that in either case, people don’t recognize legitimate restraints on their power.

      Nobody’s perfect, so nobody’s given perfect power so they can visit their imperfections on everybody else without accountability or checks and balances on their behavior. In our zeal to right the wrongs of the world, we must not abandon a system built to make sure that our wrongs can be righted by others.

      Posted by: Stephen Daugherty at September 3, 2007 09:28 AM
      Comment #231616

      David R. For years the Republicans ran a grassroots campaign against social security. I didn’t realize this at first because I have always known their stance on S.S. But, I kept hearing from my young friends and family members that S.S. was going to go broke and that they wanted to invest their S.S. in the stock market.

      After the 2004 election, the Republicans were riding high and they launched their top down assult on social security with the President as the point man. The Democrats struck back and many of those who were for the new plan began to realize that it wasn’t such a good idea after all.

      Not only did the Republicans plan fail, the people did a reassesment of their opinion about the The Republicans. The war, social security, the huge tax breaks to the rich( some of which was shifted onto the backs of the middle class the rest reflected in the huge deficits) were all contributing factors in the defeats that the Republicans suffered in 2006.

      You say that the Republicans have a very good grass roots campaign going for their fair tax proposal. I don’t doubt this a bit and people, especially the party faithful, often fall for bad Republican ideas wrapped in pretty paper until it is unwrapped and looked at.

      You have pointed out many of the reasons why this plan is bad. If the Republican candidates tout this plan as their new idea in the 2008 elections, they may win the party faithful in the primaries but, they may loose big time in the general election when the Democrats use the other side of the argument against them. It may turn out that the proponents of reforming the current plan come out the big winners.

      Posted by: jlw at September 3, 2007 10:49 AM
      Comment #231620

      One hole I see, sadly in j2t2s arguments is that, in this wonderful capitalist society, those who sell used product (which would not be taxed) would jack their prices up as far as the market would allow. For example: Say I work for Gamestop, that place that sell used video games and systems. Right now, used games are about $3-$5 less than the new version. With a 30% sales tax on a $60 Xbox 360 game, that would be $78. The company could jack the price of a used game up to $70 dollars and still undercut the new market. No savings for the consumer, but great profits for anyone who sells used products.

      Hey, anyone want to go into business?

      L

      Posted by: leatherankh at September 3, 2007 11:15 AM
      Comment #231621

      Richard,

      The only complaint I have is I think you should have picked some other multi billionaire other than Bill Gates. Gates is the most philanthropic person in the history of mankind.

      I thought Warren Buffett became the most generous philanthropist of all time when he gave away his $44billion fortune. Did I miss something?

      PS: I’m not claiming Gates is not philanthropic. I’m just trying to be factual about the most philanthropic person. Plus philanthropy doesn’t necessarily means giving money. Theresa Sister give way more time into charity than most money giving people *bought* time… Anyway, that’s another debate.

      Posted by: Philippe Houdoin at September 3, 2007 11:49 AM
      Comment #231624


      Philip: we should also consider who and why they give their money. Years ago, Gates gave millions in computers and soft ware away to schools. Since then, he has made many millions if not billions on sales to schools.

      Posted by: jlw at September 3, 2007 12:12 PM
      Comment #231625

      Stephen, calling forth a convention is one thing. Ratifying proposed changes / amendments, is another.

      There is no Constitutional reason why the convention should not be called forth by the letter of the Constitution itself. IF as you say, a lot of political hacks attend and barter to get a number of special interest minority supported amendments approved, there is nothing to fear. In the ratification process the states and their majorities will simply refuse to ratify them in sufficient numbers to nullify them.

      On the other hand, if one or a couple of majority supported amendments achieve ratification, then the democracy and Constitution worked as provided for and very likely, a great deal of frustration and political anger will have been constructively vented and exercised.

      The biggest danger is to put a dam in place to lock the people out of Article V. A dam constructed of the very arguments you make, that are NOT supported by the language of the Constitution. That dam shall function as a self-fulfilling prophecy at some point, and the ensuing flood of frustration and anger at the convention and in the states could well spell ratification of some pretty extreme and dangerous measures.

      Give the people the convention in accordance with the language of the Constitution, and reason will prevail. Deny the convention according to the Constitution’s own words, and you erect a dam frustrating reason and with pressure and time, reason will be lost, and the building pressure of passion shall one day breach the dam, and potentially rule the day and amendment process.

      Posted by: David R. Remer at September 3, 2007 12:13 PM
      Comment #231626

      leatherankh, now that would be rather unique cause of inflation for the Federal Reserve to stick in their cheek and jaw on, potentially upsetting the entire balancing act between economic stability and inflation. Thanks for raising that very important question and issue.

      Posted by: David R. Remer at September 3, 2007 12:18 PM
      Comment #231629

      jlw, I am not as confident as you that the very potent selling points, easily capsulated into single sentence talking points, can be dissuade by the kind of lengthy and exhaustive examination and counterpoint as was necessary here. A large portion of the public may hear the selling sound bites, and tune out complicated charts, bar graphs and refutations necessary to examine to the pitfalls.

      Remember how the public bought Trickle Down Economics in Reaganesque sound bites? It formed the basis for the train wreck our economy is headed toward today. Again I caution, do not underestimate the selling power of this Un Fair Tax plan. There selling points are simple, potent, and powerful. Its pitfalls are complex, nuanced, and require paragraphs and analogies to explain. Which do you think the public is going to find more readily optimistic, plausible, and comprehensible? Its a big risk to let this become a grass roots plank for a crossover candidate like Guiliani who can potentially sway the Independent vote with promises of lower taxes, economic expansion, jobs galore, and more middle class rising into the wealthy classes, all in exchange for a National Sales Tax and repeal of the hated Income Tax.

      How easy was it to sell the Congress and the people on War in Iraq with just a couple of lies? I say beware! This so called “Fair Tax” plan has the same power to sell the public as Saddam Hussein and 9/11 connections, and WMD aimed at the U.S. had to sell the public and Congress on the war in Iraq. If the people grab it for their own, even Democrat politicians will have to embrace it to keep their political careers intact.

      Posted by: David R. Remer at September 3, 2007 12:35 PM
      Comment #231630

      leatherankh, That not a hole thats another reason the “fair tax” is anything but fair. Of course the price of used goods would go up to a certain point but they would still be a better deal than new goods, depending upon how used they were, and the Feds would be raising the 30% to 40% to cover their costs or as the real plan may be the beast would shrink to just the military at the fed level. Some think that is a good idea, and perhaps it was 150 years ago but not now, IMHO.

      This tax method is an attempt by selfish and greedy people and corporations to escape their responsibilities as citizens of the greatest nation in the world. These people have manipulated otherwise decent people into beleiving that this plan will save them and all others money yet be revenue neutral or as I look at it the 1+1=3 plan. Of course that is just my opinion.

      Posted by: j2t2 at September 3, 2007 12:44 PM
      Comment #231641

      David R. Remer-
      Consider:
      There has been no constitutional convention held in 220 years, not even during the Civil War. Not once has your method of calling the convention been employed, not in all of American history. There is also nothing written into the constitution that explicitly states that the accumulation of such calls may be seen as grounds to call the convention. In the absence of explicit instructions, we have three guides: precedent, judgments and tradition.

      So far, you have offered nothing to support this interpretation besides pure logic. I can support my interpretation by precedent, by the simplicity of my interpretation, and by the fact that the one time we did have a constitutional convention, it’s calling and its initiation came within the space of a year, which would indicate what basic frame of reference the Framers would have. If they wanted something different, they would have said so, because otherwise, they knew everybody would simply use the first constitutional convention as a model.

      The Article V Convention is supposed to be rare. It’s a last resort. There are no limits that I know of for potential amendments, and no telling what amendments would end up being suggested. There is no guarantee that what you want would come out of such a convention, no guarantee that something wouldn’t be suggested and successfully marketed that might make things worse. And don’t think given the opportunity, that special interests wouldn’t push things.

      I don’t say this to discourage a convention, just to caution people that they will not be a magic cure for our political ills. In fact, they could end up amplifying them and adding new ones to them. It’s a last resort, one best employed once we’ve tried everything else.

      As far as critical thresholds go, the whole point of what the Framers put in place was to make amendments and conventions the result of broad public consensus above and beyond simple majorities, to raise such changes above the usual thresholds of political passion.

      The constitution is meant to be accepted itself by overwhelming consensus. That’s what makes it a stable basis for our government. Don’t underestimate the value of this respect, this common regard for the civil order. The strength of a Democracy is to channel such desires into smaller scale disruptions.

      You assume people will simply become more and more frustrated. I don’t think that necessarily will happen. We have plenty of ways to release this tension short of that.

      Posted by: Stephen Daugherty at September 3, 2007 04:06 PM
      Comment #231645

      Stephen, your argument, for all intents and purposes, precludes there EVER being a Convention called. That was clearly not the intent of the language in the Constitution. If that is not clear to you, we will just have to agree to disagree.

      Also, you need to observe the historical context. The last convention was conducted at a time of history when there were also no political parties dividing the nation in the election of the first President. This nation has never seen such unity since. That is why your argument, if accepted, precludes there ever being a convention. The country will crash and burn LONG before a Convention could be called by your criteria.

      You can cite precedence, tradition, to support your position, but you said: “The Article V Convention is supposed to be rare.” The fact is, if your argument prevails, an Art. V Conv. becomes impossible, given the duopoly party division game. Clearly not the intent of the drafters.

      Our Constitution could not anticipate the future reality in its myriad manifestations. I say go forward with the Convention, let opponents challenge it in the courts, and allow the Supreme Court to rule whether the language of the Article intended to make a Convention impossible, or not, given today’s context.

      Posted by: David R. Remer at September 3, 2007 04:26 PM
      Comment #231648
      Dan- … let me say this: literal interpretation is not interpretation at all.
      Not true. That’s your opinion and you are entitled to it. You are in good company. Congress agrees with you.

      However, the literal interpretation also agrees perfectly with the intended meaining (i.e. the spirit of the law).

      Article V states:

        The Congress, WHENEVER two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, OR, on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress; provided that no amendment which may be made prior to the year one thousand eight hundred and eight shall in any manner affect the first and fourth clauses in the ninth section of the first article; and that no state, without its consent, shall be deprived of its equal suffrage in the Senate.

      Where’s this time limit you refer to?

      WHENEVER is pretty darn clear.

        DEFINITION: whenever
        (ADVERB) At whatever time. See when.
        DEFINITION: when
        At the time that: in the spring, when the snow melts.
        As soon as: I’ll call you when I get there.
        Whenever: when the wind blows, all the doors rattle.
        During the time at which; while: when I was young, I was sick all the time.
        Whereas; although: She stopped short when she ought to have continued.
        Considering that; if: How can he get good grades when he won’t study?

      But perhaps you have found or invented a new and different definition of “WHEN” and “WHENEVER” ? Obviously so (like Congress).

      Also, in the spirit of the law, over half of all 567 requests have been made since 1960.
      So, aside from literal meaning of “WHENEVER”, the spirit of the law is satisfied too with over 263 requests since 1960. Congress can not make up the rules up as they go. Gee … sorry to ya’ll two thirds of all 50 states … you all have to file simultaneously (this Year? Month? Week? Day? Hour? Minute? Second?).

      “WHENEVER” means at the instant the conditiion is met. Not this year only. Not this month only. Not simultaneously.

      Therefore, whether interpreted literally or in the spirit of the law, Congress is violating Article V of the Constitution since the state legislatures of ALL 50 states have already filed 567 requests to make amendments. To refuse it demonstrates the fear and arrogance of Congress. Congress has a clear conflict of interest and that is why it is violating Article V.

      So you say it has to be contemporaneous (i.e. simultaneous)? Aticle V states “WHENEVER”. Not simultaneously. Such a restriction is onerous and oppressive. The interpretation of “WHENEVER” is quite clear to me. The states have satisfied the two thirds requirement “literally” and “in the spirit of the law” with 567 requests from ALL 50 states (far in excess of the two thirds required).

      Congress is violating the Constitution.
      But what’s new?
      Do-Nothing Congress has already demonstrated its capacity to violate the Constitution. In fact, Congress just extended the spying without civil oversight (again). And Democrats have the majority. Clearly, few (if any) in Congres have any respect for the Constitution. The Supreme Court upheld the abuse of eminent domain. The 16th Amendment may have never been ratified by three fourths of the states? The money system may be unconstitutional too; it is certainly dishonest and inflationist. And the massive debt being heaped onto future generations is despicable. That’s your generation. You may be paying for it for a long, long, long time.

      BTW, Congress persons usually respond to letters about questions and such. But almost no one in Congress will respond to questions about Article V. We got one response from Evan Bayh (D-IL) who claimed the two-thirds requirement has not yet been met.

      Posted by: d.a.n at September 3, 2007 04:55 PM
      Comment #231649
      Stephen Daugherty wrote: So far, you have offered nothing to support this interpretation besides pure logic.
      Hmmm … sorry David, you are being too logical. Perhaps you’ll make more sense if you try some illogic ?
    • Posted by: d.a.n at September 3, 2007 05:04 PM
      Comment #231652

      d.a.n., this is what happens when a person has a preference for reality which is not reality, forcing them to interpret reality to make their reality comport with their preferences.

      Debating such arguments built this way, are simple to undermine, as you have just done with Stephen’s. Stephen however, is likely to recognize his misunderstanding and acknowledge it, unlike some other debaters here who would never let reality interfere with their preferences for illusion.

      Stephen knows the value of language and absolute need for precision in its use and definitions on matters of import. Denying or altering definitions in order to promote a personal view offers no foundation for debate, as all accomplished debaters are well aware. Common definitions are the foundation for common sense. Without adherence to word definitions, there can be no common sense, and without common sense, there can be no democracy, only anarchy.

      Posted by: David R. Remer at September 3, 2007 05:40 PM
      Comment #231656
      Without adherence to word definitions, there can be no common sense, and without common sense, there can be no democracy, only anarchy.
      True. And it is very dangerous to ever start down the path of lawlessness. If we allow violations of the Constitution to begin, then an acceleration of more voilations will follow.
        “It takes a lot of degeneration before a country falls into dictatorship, she said, but we should avoid these ends by avoiding these beginnings.” ; Sandra Day O’Connor

      The essence of totalitarianism, is the destruction of the parliamentary or legislative branch of government (by the Executive branch). We have been witnessing this for many years.

      So yes. We appear to be moving toward anarchy. Aren’t all governments trying to do that? The constant struggle is to prevent it. If we fear Article V, what does it say about us? What is Congress afraid of? It requires three fourths of all states to ratify (pass) any amendments. What does that say about Congress? If we are afraid of Article V, is it possible we are already in deep trouble? Who is more likely to oppose Article V? And why? It appears some are afraid of the population at large. If so, what does that say about the government and the voters that elect it?

      For those that think it is bad now, It can get much worse. See the trend since 1980? Unfortunately, it’s not likely to improve as long as most voters don’t yet care enough to change it, 40% to 50% of voters don’t even vote, most voters don’t know their politicians much less their voting records, most voters blindly pull the party lever, wallow in the partisan warfare, and repeatedly re-elect and reward incumbent politicians with 90% to 95% re-election rates. Voters have the government they deserve. At least until the voters have sufficient motivation to change it, and only if that motivation comes in time.

      Posted by: d.a.n at September 3, 2007 07:08 PM
      Comment #231676

      David R. Remer-
      Within the same sentence that discusses the Article V convention, we are told that an amendment to the constitution may be brought to a vote from the states by a two-thirds vote in both houses of Congress.

      Nobody explicitly lays out the time this could take. By your logic, you could extend the vote forever until you got your number.

      This, however, would be considered a highly irregular way of voting on an amendment. Most votes held are held as quickly as possible, because that is supposed to be the regular way of doing things. It’s the tradition, it’s the precedent, it’s the common sense interpretation.

      Can we not apply that same interpretation to what comes in the same sentence? Given the actual history of the constitutional convention’s call, the case can be made that expectations were that these votes would be concurrent in time period, within the space of a few months to a couple years.

      If there really is a perceived need in the nation for such drastic measures, it will happen, one way or the other.

      As for language? There’s a frightening truth there. Words are as imperfect as their masters. Even the best interpretations carry with them uncertainty.

      More to the point, language captures reality the way a puddle captures the moon. As a writer, as a student of cognitive sciences, that’s what I’ve come to understand. That’s why I emphasize feedback from the real world in addition to the discipline in the use of language, because I know language and words by themselves can be misleading. Our thoughts and perceptions can be equally misleading, especially about one another.

      This is the basis of my political theory. I don’t always follow it perfectly, but I find it in hope as well as fears and sad resignation. It’s why I believed change was possible, in 2006, that the appearance of party invulnerability was just that, and no more.

      Our theories and our beliefs are a surface reflection far greater and far more complex than we can comprehend. The laws, too, must deal with this complexity. It’s why we have and need judges. It’s why people interpret beyond literal words, because words fail in the end to describe all things, and predict all paths.

      Words can become a trap for our feelings, for our emotions. That’s part of what keeps us in this damn war, even though most people want out of it. When words alone guide judgment, the results can be truly disastrous. We must accept the reality that our perceptions and understanding have their limits. The interaction and persuasion required by Democracy, while not always convenient to what wants or believes the country needs helps keep those human frailties from destroying the stability and/or the legitimacy of the government

      We have to trust that aspect of the system. When we try to break it, force it against resistance to do our will, we both generate backlashes against ourselves, and damage what keeps America together and functioning as a Republic: Freedom.

      Without freedom, people fight for what they believe is rightfully theirs. Only they do it in such a way that they give somebody else a grievance. They end up going after the other fellow, and so forth and so on. Even with the parties in place, our Democracy makes it supremely difficult for another party to use the national government as a bludgeon to bash the other side with.

      Peacemaking is one of the necessary ends of good government. A house divided against itself must fall. Good government is about resolving disputes, not perpetuating them.

      Posted by: Stephen Daugherty at September 3, 2007 11:24 PM
      Comment #231680
      Stephen however, is likely to recognize his misunderstanding and acknowledge it…
      Guess you were wrong. For Congress and Stephen, “WHENEVER” means when they feel like it. All the dictionaries should be corrected to reflect the new definition. Posted by: d.a.n at September 4, 2007 12:03 AM
      Comment #231683

      Stephen, you appear to be playing sophist word games by ignoring the import of the word OR.

      Stephen said: “Nobody explicitly lays out the time this could take. By your logic, you could extend the vote forever until you got your number.”

      BINGO! Give that man a cigar. Precisely what was intended as it would have been impossible at the time of the drafting to proscribe what would be a reasonable and accommodating time frame for the accomplishment of such weighty decisions requiring perhaps months, or years of debate before resolution and consensus was achieved. The Legislatures I might remind you were understood in prospective design to meet only once every 2 years in some cases and for short periods at that, legislators having other real day jobs to attend to when not in session.

      See what a little history can do for comprehension of Constitutional intent?

      Posted by: David R. Remer at September 4, 2007 12:47 AM
      Comment #231686

      Ahh, d.a.n. do you hear Stephen making the ‘1984’ argument that 2+2 can equal 5 if he needs it to?

      Stephen, I gave you more credit than this. I apologize for my error. The reason the law takes so many years to become versed in one specialty area or another, is not just the volume of case law precedent, but, the enormous amount of legal definitions of words much more rigidly defined than the same words used amongst the general public and local vernaculars.

      Example, the term “arrived on time” referring to a business letter of contractual agreement has a very specific definition, as in 11:59 and 59 seconds PM of the postmark date on the envelope, REGARDLESS of when the post office actually delivers the envelope to the intended recipient.

      So, too, did our drafters of the Constitution take great pains and many rewrites, and incur tremendous debate over the meanings of the words and intents of those words before all signatures could be acquired. They left a time reference out DELIBERATELY and with deliberation before doing so, in deference to the history lesson I provide above.

      Our constitution was not thrown together with the care of a WB blogging article. These were some of the most learned men of law and philosophy of their day. Words were deliberate, in their war against the King, and in their constituting of a new government for themselves. Read Adam Smith for an education in the caliber of deliberation and excruciating care with which such persons as our drafters exercised authorship. Same caliber and precision!

      Posted by: David R. Remer at September 4, 2007 01:01 AM
      Comment #231694

      David R. Remer,
      Yes, I do not think the omission of a time-limit was by accident. After all, it was 1787. Information and other things moved much more slowly in 1787. There were no telephones, E-Mail, railroads, paved highways, telegraphs, the postal service was only started a few years before that (26-JULY-1775) and it only served between Falmouth,MA to Savannah,GA.

      It was almost two years after the first Constitutional Convention (itself, which last from 25-May-1787 to 17-SEP-1787) until the Articles of Confederation was replaced with the U.S. Constitution on 4-MAR-1789. It was several years before all of the original states ratified it (CT-1788, DE-1787, GA-1788, MA-1788, MD-1788, NC-1789, NH-1788, NJ-1787, NY-1788, PA-1787, RI-1790, SC-1788, VA-1788)

      So, expecting even the few states of that time (following 17-SEP-1787) to file amendments simultaneously is absurd, and most certainly was not the intention of the Founders, or even remotely the “spirit of the law”, and the literal meaning of Article V should be obeyed until Article V is properly amended to specify a time-limit. Until a time-limit is explicity defined, “WHENEVER” must be interpreted in deference of the states (as is also common and has precedence in contract law when ambiguities exist).

      All the same, FOAVC is trying to get two thirds of states to re-submit their applications again (as simultaneously as possible, which is like herding cats), and if successful, we will then see if Congress still chooses to violate Article V of the U.S. Constitution.

      BTW, there have already been law suits that have gone to the Supreme Court, and Congress and the Supreme Court arbitraritly vetoed the text of Article V of the Constitution. But then, this is essentially the same Supreme Court that upheld abuse of eminent domain laws, spying on Americans without civil oversight, elimination of Habeas Corpus, violations of 1st and 4th Amendments, etc. Once we allow one violation, more will follow. Corruption is always trying to grow. Ignoring government invites corruption. And, sadly, the slumbering, disinterested, delusional electorate of today has little (or no idea) of the growing corruption. Therefore, the voters have the government they deserve, and they will have to learn the hard way (again).

      Posted by: d.a.n at September 4, 2007 09:58 AM
      Comment #231695

      law suits

      Posted by: d.a.n at September 4, 2007 10:02 AM
      Comment #231697

      Dan-
      Not to put words in your mouth, but it seems like the main reason you two want this cumulative standard on the conventions is that you’re scared you can’t get the radical change you believe the country needs without using one, and you believe that interpreting it in plain terms would make that impossible. Your arguments tend to say that we need to interpret it this way, or it will never happen.

      That’s an argument from fear, a text book fallacy. Perhaps if some convention had been held on those grounds long ago, I might buy it, but in fact no such convention has ever been held, much less held according to your terms.

      There is no explicit mention of any cumulative methods in there, nothing implied. If, as David says, the framers took excruciating care with their words, why would they leave such an important distinction unspoken? People leave unspoken what they perceive to be common sense or common practice.

      Where is your example of a cumulatively called constitutional convention, and how does that apply to our national, federal scope? If you can’t answer that, if you can’t show that the Founding Fathers meant for this to be one of the interpretations, then you can’t argue original intent, and all you’re doing is projecting your modern wishes for a cure for our political ills onto this.

      Oh, and on the subject of enforcement of article five: the Coleman Case seems to give exclusive management of this process over to Congress, meaning they can carry this out however they want to, so long as they carry it out. That includes their judgment on what constitutes two thirds of the states applying. The common sense interpretations is all of them doing it at once. You’re cherry-picking the law to get the result you want.

      The Supreme court, despite your complaints, is the final say on legal interpretations. As I recall it, even with Bush’s new appointees, the decisions have come down consistently knocking Bush’s claims of unlimited power down. The Kelo decision is a bit of an embarrassment, but otherwise, it’s performed well in checking Bush’s power.

      David R. Remer-
      Should we carry out every vote into indefinite time periods if they don’t give us a satisfactory result all at once?

      If we are talking about standards and practices, I should say that I find such indefinitely extended votes to be highly irregular, and counter to the intent of Democracy. You don’t extend a vote until you get what you want. It should be 34 states, an equal proportion to the the standard necessary for the ratification of the constitution, agreeing to this pretty much all at once, over a year at most. If not, then we are essentially calling the first constitutional convention in over two hundred years with less of a mandate than that which ratified the original convention’s results.

      The whole point is to have the vast majority of Americans knowing that this is going on, wanting it to happen, and believing it to be a legitimate course of action. Without that, any result that comes of it will be viewed by the disadvantaged side as a usurpation of their rights by political chicanery. Look at what’s happened to the Republicans as a result of all the constitutional crises and the overbearing style of government they’ve employed. Would the gains you seek survive the controversy that just the calling on these grounds would produce?

      In fact, recall that the original parties, the Federalists and the Democratic-Republicans (later just the Democratic Party) were born of these initial controversies. It’s still playing out today! America only survives now because there was enough of a mandate generated by the consensus building that accompanied the constitution that Americans generally accepted the arrangement.

      Like I said to Dan, people leave things out because they should be obvious, or because there is a common practice. You have offered not one shred of proof that any precedent exists to justify your interpretation.

      And lets’s not praise the rigid definitions of the law too much. Loopholes are born of definitions or judgments too rigidly defined to properly cover the complex subject at hand. You can end up failing to see the forest for the trees. You fail to see how the legitimacy of the political power you seek plays into the future of whatever gains you hope to make.

      I knew the Republicans were heading for some reckoning long before 2006. You cannot store up that much resentment, win so many battles by thin margins and bare technicalities, and not lose your mandate. They overestimated how much imposition others were willing to tolerate from them, and for that, they paid with their political power.

      The nature of enduring power is consensus building and peace-making. Without that patience, nothing lasting can be done. You cannot escape political partisanship unless you become willing to give up your own personal preferences to both deal with the realities of your situation and to negotiate with all the other people who will not simply be a doormat to your political ambitions. It’s about putting cooperation ahead of competition, real world results and efficiency ahead of their on-paper cousins.

      Words can be deceptive, their interpretations at odds with the real world. Laws, when they are too precisely written, can become riddled with loopholes; when too vague, they can become difficult if not impossible to enforce.

      I make a big deal out of precedent in this case, because in the absence of any explicit time given, they are our only guides as to the expectations of the Framers. If none of the framers conceived of things this way, then logically, the default proposition of a comtemporaneous vote wins out, and the notion of accumulation of calls over multiple years becomes the position of sophistry, built on a loophole in the constitutional law, and little else.

      Posted by: Stephen Daugherty at September 4, 2007 10:17 AM
      Comment #231698
      Stephen Daugherty wrote: Dan- Not to put words in your mouth, but it seems like the main reason you two want this cumulative standard on the conventions is that you’re scared you can’t get the radical change you believe the country needs without using one,
      So, obeying the Constitution is radical change, eh?
      and you believe that interpreting it in plain terms would make that impossible.
      Now it is “plain terms”. Oh right … using pure logic is too logical, eh?

      I’m getting a real kick out of watching these contortions to fit partisan loyalties and weak arguments into reality (now that Democrats have the very slim majority) … like watching someone trying to fit a square peg into a round hole. You’ve got your work cut out for you. You’d better start with all the dictionaries in rewriting the definition of “WHENEVER”.

      Your arguments tend to say that we need to interpret it this way, or it will never happen.
      Not true. I didn’t write Article V. “WHENEVER” makes it quite clear.
      That’s an argument from fear, a text book fallacy.
      Quick. Look in the mirror. There’s the real fear. Fear that the status quo will be upset (now that Democrats have a slim majority, eh?).
      Perhaps if some convention had been held on those grounds long ago, I might buy it, but in fact no such convention has ever been held, much less held according to your terms.
      My terms? It’s not my terms at all. It’s the Article V of the Constitution.

      The argument hinges on the meaning of “WHENEVER”. You’d better get to work on those dictionaries and rewriting the definition of “WHENEVER”.

      Words can be deceptive, their interpretations at odds with the real world.
      Only when some people try to obscure and distort their real meaning. So, what does “WHENEVER” mean to you? When you and Congress feel like it?
      I make a big deal out of precedent in this case
      Of course you do. Because redefining “WHENEVER” is appearing too difficult? Precedent does not trump or veto the language of Article V. Just because the Supreme Court is also in violation of Article V does not justify it.

      The lame excuse of precedent also ignores 567 requests for amendments by ALL 50 states. Over Half since 1960.

      So, what is this time limit you read in to the Constitution? A year? A month? A week? An hour? A minute? A second? 1 millisecond? 1 nanosecond? You conveniently and completely ignore the fact that Article V was written in 1787, and that it was almost two years after the first Constitutional Convention (itself, which last from 25-May-1787 to 17-SEP-1787) until the Articles of Confederation was replaced with the U.S. Constitution on 4-MAR-1789. It was several years before all of the original states ratified it (CT-1788, DE-1787, GA-1788, MA-1788, MD-1788, NC-1789, NH-1788, NJ-1787, NY-1788, PA-1787, RI-1790, SC-1788, VA-1788).

      It appears that partisan motivations (now that one’s precious Democrat party now has a slim majority) can explain these contortions and attempts to redefine “WHENEVER”, and grasping at straws to interpret Article V to suit their one’s own purposes to perpetuate the status quo.

      I knew the Republicans were heading for some reckoning long before 2006. You cannot store up that much resentment, win so many battles by thin margins and bare technicalities, and not lose your mandate. They overestimated how much imposition others were willing to tolerate from them, and for that, they paid with their political power.
      Still wallowing in the partisan warfare? That can cloud judgement.

      Stephen Daugherty,
      You are entitled to your opinion. I don’t share it, so trying to redine “WHENEVER” and use the lame arguement of precedent (it’s never happened before), etc. doesn’t cut it. However, you are in good company. Our illustrious Do-Nothing Congress agrees with you. I wonder why that is?

      Posted by: d.a.n at September 4, 2007 10:58 AM
      Comment #231699

      so trying to redine redefine “WHENEVER”

      Posted by: d.a.n at September 4, 2007 10:59 AM
      Comment #231700

      Dang it. Have you noticed single and double quotes must be typed over if ever cut-and-pasted? Also, space-dash-space creates problems. Movable Type seems to have a problem with substituting these characters. Thus, the double quotes ” ” that are appear italicized appear as “ and ” (but not during Preview; only after Posting).

      Posted by: d.a.n at September 4, 2007 11:05 AM
      Comment #231712

      Dan-
      According to your logic, Amendments could be proposed this way: We cherrypick individual votes by reprepresentatives from different congresses over a period of year until we get enough numbers in both houses to get the amendment passed.

      Obviously, that’s not how its done. The amendment is set before Congress, revised as needed, then voted upon by the Senate and House of Representatives, as they would any other bill. If 2/3rds of both houses approve it, it’s proposed to the states who do their thing.

      The whole legitimacy of the votes described in Article V is not in its numbers, but in its proportion: those who represent the states, or the states themselves, agree in an overwhelming majority, similar to that which ratified The original binding agreement of our Republic, that a change should be made to that agreement.

      That proportion is meaningless if by accumulation, because the mandate it’s supposed to bring comes from the fact that so many people, so many states at once want the changes made. That’s what gives our amendments their authority, what the thresholds are all about.

      What is this “whenever” about? Interesting question. Unfortunately for you, you and David and this other guy seem to be some of the few people in the history of this country to take that interpretation, the evidence for that being that in two hundred and twenty years, we have not seen one other Constitutional Convention held. Surely, if that had been the case, We would have seen a number of them in the beginning years of our nation, when the states were fewer in number.

      It never has happened. What claim can you lay to original interpretation when nobody at that time ever saw it your way?

      The accepted method is the proportion petitioning at once. It fits the bill in the simplest and most commonsense manner possible, and preserves the obvious intent: that Congress and the States could only undo and redo matters in the constitution with the same support that the Constitution was ratified by.

      Speaking of that, if you look, the states needed to ratify the constitution could have done so officially within nine months of the convention. Not years, months. They waited a few years because they did not want divisions in the resulting government. Where the letter of the law could have allowed them to impose the constitution on them, they took a more informal approach, and persuaded them towards a unanimous acceptance of the Constitution.

      This attitude is sadly lacking in many today.

      Posted by: Stephen Daugherty at September 4, 2007 01:45 PM
      Comment #231713

      Stephen asked: “Should we carry out every vote into indefinite time periods if they don’t give us a satisfactory result all at once?”

      We should if the Constitution says to, and it does here, or, amend the constitution to read otherwise imposing the requirements you or others believe are appropriate. That is in fact, how are Constitutional government was designed to operate. It just couldn’t be clearer.

      Posted by: David R. Remer at September 4, 2007 01:48 PM
      Comment #231717

      Stephen said: “I should say that I find such indefinitely extended votes to be highly irregular, and counter to the intent of Democracy.”

      Ahh,,, so you choose to ignore the Constitution’s definition of democratic republic when it interferes with your personal view of what democracy should be. Mighty authoritarian comment to make, don’t you think? Sounds like I am talking to Gonzo or GW Bush.


      Stephen said: “The whole point is to have the vast majority of Americans knowing that this is going on, wanting it to happen, and believing it to be a legitimate course of action.”

      NO! THAT IS NOT THE POINT in the Constitution. That is YOUR Authoritarian point trying invoke your agenda in opposition to the Constitution’s stated point: “on the application of the legislatures of two thirds of the several states, shall call a convention for proposing”.

      The Constitution does not contemplate unanimity of intent of the people. The Constitution CLEARLY states the legislatures, as consistent with a republic in which democratically elected representatives of 2/3 of the several states is the stipulation. It appears obvious from your comment that you have no desire or wish to comport with the Constitution, or, that it is a document that defies your understanding and comprehension. If the forefathers had intended direct democracy they would have said the people, not the legislatures.

      Stephen said: “In fact, recall that the original parties, the Federalists and the Democratic-Republicans (later just the Democratic Party) were born of these initial controversies.”

      In fact, recall that the Constitution was written before the rise of political parties. Are you now suggesting that the advent of political parties nullifies the US Constitution and political parties should supplant the Constitutional basis of our government? That seems to be the implication of your comment.

      Stephen said: “Like I said to Dan, people leave things out because they should be obvious, or because there is a common practice.”

      And you were wrong about that in reference to the Constitution. The drafters were not operating on precedent. They were creating an entirely new form of government non-existent in their world. And on this issue they left nothing out, they imposed the word WHENEVER, which contradicts your assertion that timing was unspoken and assumed or common practice.

      And your comment ignores the historical context referred to previously, which dictated that setting a time frame was not practical, given weather, difficulty of travel, differing schedules of legislature’s sessions, some years apart, and the shortness of their sessions which may require multiple sessions years apart to deliberate and reach consensus. Is this ignorance deliberate and convenient for your argument? If so, it does nothing for the credibility of your point of view.

      Posted by: David R. Remer at September 4, 2007 02:17 PM
      Comment #231718

      d.a.n, yes, those characters have been a problem with this invocation of Movable Type for many years. It is necessary to retype quotes, apostrophes, and dashes when copied.

      Posted by: David R. Remer at September 4, 2007 02:19 PM
      Comment #231729

      David R. Remer,

      You might as well be talking to a fence post.
      Congress and Stephen have a different definition of “WHENEVER” and “OR”.

      We never did get an answer on the time-limit on “WHENEVER”.

      The “spirit of the law” is also ignored, since over 283 amendments have been submitted by the state legislatures since 1960, 564 requests since 1900, and 567 requests since the first application by Virginia in 1789.

      Even if I was against an Article V Convention, I would have to concede that the language of Article V works in deference of the states. That is a precedent common in contracts when ambiguities exist. However, I don’t think the lack of a time limit was a mistake since they were careful to state in Article V that:

        Article V of the U.S. Constitution: The Congress, WHENEVER two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, OR, on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress; provided that no amendment which may be made prior to the year one thousand eight hundred and eight [1808] shall in any manner affect the first and fourth clauses in the ninth section of the first article; and that no state, without its consent, shall be deprived of its equal suffrage in the Senate.

      How about them apples, eh?

      So, why would they be so careful to place a time limit (e.g. 1808) on future changes to Article One, but not Article V ? That’s because a time limit was never intended for Article V. Without a time limit, the accumulation takes precedence, and applications can not be discarded until done so by a Convention.

      The problem appears to be (now that some peoples’ favorite party is in power) that blind partisan loyalties affect their judgement and provides the motivation for protecting the status quo and ignoring the direct text and the “spirit of the law” in the U.S. Constitution ? Thus, talking to a fence post could be equally productive.

      Posted by: d.a.n at September 4, 2007 04:36 PM
      Comment #231730

      d.a.n., we have made a change to see if it corrects the copy paste character display issue. Please advise if you continue to experience the problem.

      Thank you for mentioning this and bringing it to my attention.

      Posted by: Watchblog Managing Editor at September 4, 2007 04:43 PM
      Comment #231731

      David R. Remer-

      Stephen asked: “Should we carry out every vote into indefinite time periods if they don’t give us a satisfactory result all at once?”
      We should if the Constitution says to, and it does here, or, amend the constitution to read otherwise imposing the requirements you or others believe are appropriate. That is in fact, how are Constitutional government was designed to operate. It just couldn’t be clearer.

      So far as I can tell, the text of Article V doesn’t prescribe any time period short or long. Logically speaking, if Congress chooses to consider just the contemperaneous requests as requiring it, that satisfies the letter of the law. I would add that it also satisfies the spirit of the law.

      Additionally, since there is no precedent for cumulative calls in all of American history (am I wrong?), and the only successful call we have in our history occured within a single year of the convention itself, I’d say precedent argues against your interpretation.

      Stephen said: “I should say that I find such indefinitely extended votes to be highly irregular, and counter to the intent of Democracy.” Ahh,,, so you choose to ignore the Constitution’s definition of democratic republic when it interferes with your personal view of what democracy should be. Mighty authoritarian comment to make, don’t you think? Sounds like I am talking to Gonzo or GW Bush.

      I’m objecting to tactics which extend votes until the desire results are attained, tactics that were common with our Former Republican Congress. Medicare was one example. The only reason to indefinitely extend the timeframe of a vote is to accumulate over time what you cannot get all at once. Since the proportion of support for an amendment is part and parcel of its proposal and passage, timeframe is important to proper gauging of popular support.

      Stephen said: “The whole point is to have the vast majority of Americans knowing that this is going on, wanting it to happen, and believing it to be a legitimate course of action.”

      NO! THAT IS NOT THE POINT in the Constitution. That is YOUR Authoritarian point trying invoke your agenda in opposition to the Constitution’s stated point: “on the application of the legislatures of two thirds of the several states, shall call a convention for proposing”.

      The Constitution does not contemplate unanimity of intent of the people. The Constitution CLEARLY states the legislatures, as consistent with a republic in which democratically elected representatives of 2/3 of the several states is the stipulation. It appears obvious from your comment that you have no desire or wish to comport with the Constitution, or, that it is a document that defies your understanding and comprehension. If the forefathers had intended direct democracy they would have said the people, not the legislatures.

      What did I say?

      The vast majority of Americans should know about this. Transparency. Is transparency authoritarian?

      The vast majority of Americans should want it to happen. That is, it should have the mandate of an overwhelming proportion of Americans behind it.

      The vast majority of Americans should believe it to be a legitimate course of action. I hardly see how this convention being a representation of a consensus of the public makes it undemocratic.

      You seem to be focused on disputing with me what is not even written into the law.

      Stephen said: “In fact, recall that the original parties, the Federalists and the Democratic-Republicans (later just the Democratic Party) were born of these initial controversies.”

      In fact, recall that the Constitution was written before the rise of political parties. Are you now suggesting that the advent of political parties nullifies the US Constitution and political parties should supplant the Constitutional basis of our government? That seems to be the implication of your comment.


      I read what you consider to be the gist of my comment and I feel like we’re in different universes on the matter.

      Yes, the constitution was written before the advent of the political parties. The divisions, though, Federalist and anti-Federalist, that spawned them are known to have their genesis in the disputes between those who were solid supporters of the constitution, and those who felt the central government to be an imposition on the rest. The Bill of Rights, in fact, was a compromise between these two factions.

      The advent of political parties hardly nullifies the constitution, and political parties should uphold the constitution. I’ve never said any differently, and its unfair of you to characterize my position in that fashion based on my disagreement with you on the interpretation of Article V. You’re passionate on the issue to the point where you’re treating me like an enemy. I don’t think you’re trying to undermine Democracy, I just find your position on Article V untenable.

      Stephen said: “Like I said to Dan, people leave things out because they should be obvious, or because there is a common practice.”

      And you were wrong about that in reference to the Constitution. The drafters were not operating on precedent. They were creating an entirely new form of government non-existent in their world. And on this issue they left nothing out, they imposed the word WHENEVER, which contradicts your assertion that timing was unspoken and assumed or common practice.

      And your comment ignores the historical context referred to previously, which dictated that setting a time frame was not practical, given weather, difficulty of travel, differing schedules of legislature’s sessions, some years apart, and the shortness of their sessions which may require multiple sessions years apart to deliberate and reach consensus. Is this ignorance deliberate and convenient for your argument? If so, it does nothing for the credibility of your point of view.

      The Drafters, even if they departed into unknown waters, began from familiar harbors. We inherited much of our jurisprudence from the British, in terms of common law and precedence in cases. They drew upon experience in state legislatures and other parts of state government. Rome had a Senate long before America did, and many government had elected representatives. The federal system is forshadowed in many other kinds of government, and Democracy itself is modelled on the systems of the Ancient Greeks.

      You and dan both focus on the use of the word “whenever” as the basic support for your pushing of the cumulatively called convention. Trouble is, so long as the clauses thereafter can be logically satisfied by other means, a straight reading would not render what the government does unconstitutional on its account.

      What I would point out, in response to your claimed reasons for the lack of any explicitly given time limit, is that:

      a) the reasons for its absence are irrelevant, if you’re arguing that it reflects a literal reading. If we’re going strictly by what’s on the page, it’s not there.

      b) Despite the reasons you give, the first convention was convened within a year of being called, and it had the number necessary for ratification within the next.

      c) If there was real concern on the matter, why wouldn’t it be written into the the constitution? It would be a true failure of foresight for them not to deal with this issue, in that case. The historical evidence, though, indicates that they had little problem in quickly getting the word out for the purposes of ratifying it.

      d)finally, any such explanation finds itself obsolete in a day and age where faxes could deliver such information in seconds and the mail in a few days if not hours.

      There’s no real practical reason to extend votes indefinitely, unless you want the insufficient pushes of a minority or slim majority to add up to a full convention by sheer accumulation.

      Here’s a question: if the proposing of a constitutional amendment by congressional method typically takes place by the approval of two-thirds of all senators and all Represenatives, why should less than two thirds of the states be able to trigger a convention to propose amendments, just because some states proposed one a few years ago?

      Moreover, what limits would you place? Why should the states of today be burdened with the political decision of state legislators decades in the past? Isn’t it unfair to citizens to have these political decisions automatically foisted on them? The whole point of a Democracy is to register the public’s will now. Why would you argue against incumbent politicans that have overstayed their welcome, but not allow constitutional calls that came to nothing fade into the sunset?

      Shouldn’t it be the least bit important to you what the people of these states think now, especially since you place such an emphasis on political turnover? The cumulative standard makes the initiation of such a convention an arbitrary event, unrelated to what the will of the people is. With this standard, a few calls could pile on an old set, and drag the nation back to this drawing board at the whim of a few states. How the hell is that Democratic?

      A convention should be called by more than two thirds of Americans or not called at all. Only when the call is made by Americans united together in such great numbers can we be content that it has the mandate necessary to grant it legitimacy.

      Posted by: Stephen Daugherty at September 4, 2007 04:50 PM
      Comment #231733

      d.a.n, the major obstacle however, remains: “as the one or the other mode of ratification may be proposed by the Congress;”

      Since Congress won’t convene for ratification, the states must convene their own ratification sessions, but, the choice of which method for ratification is used is to be determined by the Congress. A major obstacle if our U.S. Congressional representatives refuse to determine a method for ratification of amendments proposed and agreed to by 3/4 of the legislatures or the state’s conventions.

      That said, should 3/4 of the states pursue and agree on amendments, public awareness and pressure would accompany that process to threaten the U.S. Congress to act or face not being reelected. The ball appears to be clearly in the state’s court at this point.

      Posted by: David R. Remer at September 4, 2007 04:52 PM
      Comment #231738

      Stephen said: “The vast majority of Americans should want it to happen. That is, it should have the mandate of an overwhelming proportion of Americans behind it.”

      That is NOT what the Constitution says. I refuse to accept your opinion over the language of the Constitution, which is what the Bush administration has become famous for doing. Your tactics have great affinity with Republicans, Stephen.

      You keep making comments like this which reveal an inadvertent or deliberate intent to subvert the Constitution and our constitutional basis for governance, for a personal agenda which stands contrary to the clear language in the Constitution.

      Ours is a Republic form of government, and the founders were very clear that it was NEVER their intent that our country be governed by direct democracy or majority public opinion acquired in an instantaneous and simultaneous poll. That is irrefutable, because that capacity didn’t exist in the 18th century.

      Posted by: David R. Remer at September 4, 2007 05:14 PM
      Comment #231740

      All these tax “reform” proposals by right-wingers are the invention of the wealthy who would like their tax burdens to go down. The upshot is that the rest of us will need to pay more in taxes, because the deficit isn’t going to get paid down by itself. All the non-wealthy who support these “reforms” are just the suckers in this con game. They can’t do simple math, I guess.

      Posted by: mental wimp at September 4, 2007 05:33 PM
      Comment #231746

      mental wimp, these are somewhat complex proposals.

      Both the sales and flat tax are regressive in their pure form. The Flat Tax, by exempting income levels approaching poverty from taxation, and shifting the burden from businesses to individuals, with NO exemptions otherwise, is fairer than the sales tax, as it ropes in the same percentage of income from the wealthy as non-wealthy, IF investments cannot be rendered tax exempt. But, the flat tax seriously curtails government’s ability to reward or unreward preferential corporate, investment, and savings behaviors, using tax breaks or increases on specific behaviors.

      My point is not to compare plans here, but, to demonstrate that tax plans, current, or otherwise, are complex in their consequences and results, regardless of how simple the plan may be in construction. Hence, simple math I don’t think is the public’s problem, here. Their problem is access to objective and rational evaluation of the various forms of taxation. Each has differing sets of strengths and negatives, making comparison more complex than it would at first appear.

      Posted by: David R. Remer at September 4, 2007 07:07 PM
      Comment #231747
      David R. Remer wrote: d.a.n, The major obstacle however, remains: “as the one or the other mode of ratification may be proposed by the Congress;”
      No. That has already been decided in court. Article V states. Perhaps you are interpreting it to mean Congress has the option to ratify? It does.:
      . . when ratified by the legislatures of three fourths of the several states, OR by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress.

      Congress MUST choose one or the other:

      • (1) legislatures of three fourths of the several states

      • (2) OR by conventions in three fourths thereof
      From a constitutional point of view, it does not matter whether ratification is by state legislatures, or by state ratification conventions. So long as three-fourths of these bodies ((1)legislatures or (2)conventions), ratify the proposed amendment it is equally constitutionally valid. Congress must choose one or the other.

      If Congress refuses to, it is (again) in violation of Article V. In my opinion, Congress is already in violation of Article V by refusing to acknowledge the 567 requests for amendments by all 50 states (564 since 1900 and 283 since 1960; 567 since the first request by Virginia in 1789).

      By the way, 51 (or more) of the 567 requests from the state legislatures are amendments with regard to taxation.

      Why should the states of today be burdened with the political decision of state legislators decades in the past?
      __________
      Stephen, If you had ever bothered to look at the states’ applications, you would see that most are the same subjects, over and over (e.g. taxation, balanced budget, term limits, electoral college, etc.). Many states are submitting applications for the same reasons, over and over.

      That’s why.

      But that logic is irrelavent, right?
      Since, “pure logic” is not allowed?
      After all, you wrote:

      So far, you have offered nothing to support this interpretation besides pure logic.

      Interesting. Your mind appears to be set … like setting concrete, it takes time to cure. You are entitled to your opinion no matter who contorted it is.

      Also, aside from your new definition of “WHENEVER” and “OR”, you overlooked the part about the Founders specifying a time limit [year 1808] for changes to Article One. That would logically seem to impact your notion of Founders intentions? But, then, I forgot. Logic isn’t allowed. Neither is “interpreting it in plain terms”.

      But why would the Founders be so careful to specify a time limit (21 years into the future) for changes to Article One, and not specify a time limit for Article V. That’s because a time limit was never intended. The Constitution has other time limits, yet you choose to interpret no time limit and “WNENEVER” which ever way you feel like. Interesting how people want to ignore selected parts of the Constitution when it might upset the status quo. Again, you are in good company, since Congress and the Supreme Court agree with you. Have you considered a career in Congress?

      Posted by: d.a.n at September 4, 2007 07:32 PM
      Comment #231748
      Their problem is access to objective and rational evaluation of the various forms of taxation

      Most notably from those who do not want to see the current system changed. This article and many of the comments by the detractors here are good examples of that.

      Posted by: Rhinehold at September 4, 2007 07:58 PM
      Comment #231749

      dan-
      We have different definitions not of “whenever”, but of “on application of two thirds of the several states,”.

      You seem to think that means a number equal to two thirds of the states, just scraped up over time. You could get a third here, a third there, and just get whatever number you needed. to make up the difference.

      I think that’s a terribly undemocratic way to call a convention. Let’s say a law could be consider passed if a number equal or greater than fifty-one percent of the number of legislators voted for it cumulatively over a number of tries.

      Even if you restricted the increase just to those whose votes represented unique votes, it still wouldn’t be democratic, because the idea with a Democracy is that the votes decide, then and there, what the sentiment is on the proposal. If a law doesn’t pass by a majority, it shouldn’t be a law, no matter how many times, and how many votes you resubmit it for. The Majority rules.

      But what Majority? Normally, a vote is kept to one time, on one matter, because that lets you get a nice, clean proportion to judge the results from. It also keeps the positions of those involved unambiguous. What does it mean if a state participates in a constitutional call this time, but not the next time? Should those states that have shifted politically be forced to remain counted among those who have made a call in the past?

      I think it’s a hell of a lot simpler just to consider the constitutional calls together at one time. Moreover, it better reflects whether or not the convention has the mandate to proceed. If it doesn’t, it’s a waste of time or worse. A constitutional convention is too important to call arbitrarily.

      David R. Remer-
      It’s easy to get wrapped up with the politics. Please try and relax. I’m finding it difficult not to take your accusations personally.

      My opinion, simply put, is that to be of value, a vote must crystallize where the consensus of the people stands at the moment that the action takes place, whether it’s the passage of a bill, the ending of debate, or the election of a candidate. Otherwise, it doesn’t represent anything real. The point of restricting the timeframe in practice is to have a coherent picture of what the states, the people, or the legislators want.

      The Republicans extended many votes until they got the majorities they wanted. They weren’t willing to take no as an answer, which is what they might have gotten if they had held the vote as normal. A number of fairly lousy bills came of such chicanery, including Medicare Part D.

      This whole thing smacks of that to me. You don’t like the fact that the votes are falling short. Somebody comes along and says that you have all the votes you want, but that the corrupt duopoly is standing in the way, not doing its job. You buy into that, and then look at my position as if I’m fighting on the side of corruption.

      But I haven’t taken those leaps. I start from the simple position that the calls were supposed to be a more or less unified response, in time or manner, that would bring the mandate necessary to justify the revision. I’m arguing that the similar thresholds, prescribed in parallel within Article V, should operate on a similar basis to one another. One would represent a method to get amendments proposed with Congress’s help, the other would bypass it, but both would seek the same overwhelming support from the states, from the people.

      That simply doesn’t work if you use a cumulative standard for the Convention call, and yet stay with the traditional vote required of an amendment proposal going through congress. I see no evidence that one approach should be radically different from the other besides as the Constitution prescribes. Their common requirement indicates that they are both suppose to measure the same thing.

      Posted by: Stephen Daugherty at September 4, 2007 08:00 PM
      Comment #231761
      Most notably from those who do not want to see the current system changed. This article and many of the comments by the detractors here are good examples of that.
      Not me. The current system sucks. Of the four sytsems, I prefer number (1) (below):
      • (1) The 17% income tax (with no tax by anyone on income below the poverty level (e.g. the first $10,000); no tax loop holes, and no taxes on corporations that simply get passed on to consumers as a hidden, regressive sales tax) taxes everyone pays an EQUAL percentage of income above the poverty level. To me, that seems most fair. No one (rich or poor) pays any tax on the income below the poverty level, and only income above the poverty level is taxed the same 17% for everyone. An equal tax rate is neutral; neither regressive or progressive.
      • (2) The current tax system, which is a mixture of a progressive tax system and a myriad of tax loop holes that let the wealhty pay less tax as a percentage of income. Warren Buffet now pays less tax as a percentage of income than a secretary making $60,000 annually since capital gains are only taxed at 15% , but the average income tax rate is 20%.
      • (3) The 30% Sales Tax (the FairTax.org plan, with pre-bates), which would most likely tax those at the lower income levels more as a percentage of income unless the wealthy spend all of their money (as most people at the low income levels do). It would probably allow the wealthy to pay less tax as a percentage of income since the people with incomes approaching the lower spectrum have to spend most of their money to get by (thus, losing upto 30% of their income to the 30% sales tax). Sales taxes are regressive unless everyone spends all of their income. This isn’t likely for the wealthy.
      • (4) The progressive income tax system would increase the tax rate as income increases. I consider this unfair and no better than the opposite situation where the percentage of income increases as income decreases. To me, this is truly what I would call “soaking the rich”. None of the other 3 tax sytems above can be accused of soaking the rich.
        DEFINITIONS:
        • REGRESSIVE TAX: the less you earn, the higher your tax rate (regardless of how tax is paid; i.e. sales tax or income tax).
        • PROGRESSIVE TAX: the more you earn, the higher your tax rate (regardless of how tax is paid; i.e. sales tax or income tax).
        • NUETRAL TAX: regardless of your income, you pay the same tax rate (regardless of how tax is paid; i.e. sales tax or income tax). Of course, many system choose to not tax the lowest income levels since that simply pushes people onto welfare.
      Which system do you prefer? VOTE here.
    • Posted by: d.a.n at September 4, 2007 09:41 PM
      Comment #231767
      Stephen Daugherty wrote: dan- We have different definitions not of “whenever”,
      Yes we most certainly do.
      … but of “on application of two thirds of the several states,”.
      Not true. Two thirds is quite simply two divided by three. Yikes! Surely you are not going to tell me that is wrong too! ? !

      Arguing about the definition of “WHENEVER” and “TWO THIRDS” is ridiculous since you seem to be reading out of a different dictionary than the rest of us.

      I prefer to follow the standard definition of “WHENEVER” in the English dictionary. I’m not sure what planet your definition comes from.

      Stephen Daugherty wrote: You seem to think that means a number equal to two thirds of the states, just scraped up over time.
      That’s right. There is no time limit and it was by design. Besides, over half of all 567 were submitted since 1960. All but 5 of 567 were submitted since 1900. But leave it to someone that wants to protect the status quo to try to create new definitions of “WHENEVER” and “TWO THIRDS”. Especially when Article V also contains (within the same paragrpah) a 21 year time limit on changes to Article 1 (between 1787 and 1808). That corroborates my assertion that no time limit was intentional.

      And in the absence of a time limit, “WHENEVER” must be interpreted as just than until it is amended to be more specific.

      You have still ignored the fact that most applications are about the same things over and over. 51 or more are amendments about taxation. Others are about term-limits, line-item veto, school attendance, education, electoral college, etc.

      If you want to know more, go here (FAQ).

      TEST PUNCTUATION: “ ” ’

      Posted by: d.a.n at September 4, 2007 10:01 PM
      Comment #231768

      David R. Remer,
      Hurray!
      You seem to have fixed the puctuation thing.

      “TEST1” - TEST2 TEST’3

      Posted by: d.a.n at September 4, 2007 10:03 PM
      Comment #231776

      So, is there a link that provides information on when these applications for this convention were made, and their text?

      Posted by: womanmarine at September 4, 2007 10:53 PM
      Comment #231777

      Stephen said: “I start from the simple position that the calls were supposed to be a more or less unified response, in time or manner, that would bring the mandate necessary to justify the revision.”

      Which is not supported by the Constitution. I don’t mind or care what your personal opinion is. I only care when you try to impose your opinion in place of the Constitution, and then claim that is the intent of the Constitution. That has been a tactic of Republicans and look where it has got them. If you won’t accept what the Constitution clearly and unambiguously states, support an Article V Convention and work to change the language, legitimately.

      But, don’t try to ignore what the Constitution says with great deliberation and precision, and supplant it with your opinion about what it should have said, and claim the drafters didn’t know what they were saying. I won’t allow such a tactic to go unchallenged, out of respect for the incredible effort, diligence, and brilliance for its time, of the drafters in constructing it, under threat of death. They said what they meant, and they meant what they said. To imply otherwise is to disrespect the monumental years of effort, debate, rewrites, and more deliberation, final consensus of the drafters and historical context in which those words were adopted.

      The English word “whenever” has not changed in definition since the 18th century. It was a deliberated word, as demonstrated by the drafters will to proscribe time periods for other portions of the Constitution. Your argument is illogical. Your tactic to use the Constitution to perversely alter its intended meaning is intellectually and evidently unsound.

      You cannot logically defend intent in the 18th century by action or lack of action post 18th century, as in arguing the absence of a convention subsequent to the time of the drafting, and first Convention, is somehow implicative of intent in the 18th century. That is revisionist history, and intellectually dishonest to revise the past based on changed perceptions in the present.

      Democracy at the time of the Constitution’s origination was not, by any stretch of the imagination, a broad and sweeping concern or intent of the founding fathers. They limited democracy in so many ways, from white male landowners to embodying the fear of majority infringement upon individuals or minority inalienable rights in the Bill of Rights and a republican representative government NOT bound by majority opinion. It is to America’s great credit and honor that its people have matured and become educated broadly enough to have expanded democracy from what was only limitedly permitted originally.

      But, that expansion of democracy came only in the last 85 years. It is a false postulation to view the Constitution and meanings through today’s eyes of vastly expanded rights and greater public participation in the political process; and argue from that contemporary view and circumstance that, the drafters intended the people as a majority to speak with one and simultaneous voice in order to convene a constitutional convention, when the language addressing the issue clearly had no such intention or contemplation.

      The drafters contemplated the fact that the future may not find the Constitution’s provisions adequate for changed times and circumstances, which is precisely why they provided an amendment process and Article 5 provisions for altering it, legally, constitutionally, and with the weight and force of rule of law, not personal opinion and interpretation whose foundation and consequence is anarchy.

      Posted by: David R. Remer at September 4, 2007 11:24 PM
      Comment #231778

      D.a.n, not me, Cameron Barrett, the owner made the changes necessary. I only put in the request.

      Posted by: David R. Remer at September 4, 2007 11:25 PM
      Comment #231786

      Dan-
      First, stop saying its obvious. If it were that obvious, it wouldn’t have taken 220 years for somebody to get it right, according to your definition.

      Second, “whenever” is a conditional and the clause that follows it only requires that two thirds of the state state legislatures apply for the convention. It does not say how, and the interpretation that’s served as the basis for most calls reflects the tradition that it’s an altogether thing. That the state legislatures have repeatedly applied in this fashion indicates that they abide by it, for otherwise, they would just simply accumulate the votes by the legislatures.

      Or to put things in another way, in what way does having the legislatures push for something together and seeing whether they clear thirty four calls not fit the text of the amendment? You hold the vote, and if the calls exceed thirty four, altogether, the convention happens.

      Don’t underestimate how much success has been had. There have been an number of narrow misses, including a Balanced Budget Amendment which garnered 30 such calls.

      It’s not out of the question. You just have to get the vast majority of the public on your side. It’s difficult, but that’s the point. You should look at the Texas State constitution if you want to see what a mess a constantly revised constitution can create. The point of making amendments and conventions a difficult thing is not to protect duopoly power, or any such crap like that, but instead to protect those who are out of power.

      If proposing and ratifying amendments was easier, Congress would have had a field day using the amendments as weapons against other political factions. By making them more difficult to propose and ratify, the Framers made it necessary to get the consensus of the States and the American people on their side before one could do either. That has considerably lessened the damage. If Bush violating the fourth amendment was bad, how about him gutting it with further amendments?

      This process is supposed to be difficult so that well-intentioned people like us don’t knock it out of control.

      Posted by: Stephen Daugherty at September 5, 2007 12:00 AM
      Comment #231792

      Stephen. The Constitution calls for a unanimity of 3/4 of the State Legislatures, not public opinion. That condition has been met. It is now time to remove U.S. Congress persons who subvert the Constitution by refusal to acknowledge the Constitution in this regard. Perhaps that is what you mean by getting the people to back the play.

      Just as it was time to remove Republicans from office in 2006 for their refusal to acknowledge the constitutionality of FISA court review and oversight regarding surveillance of Americans.

      Posted by: David R. Remer at September 5, 2007 12:27 AM
      Comment #231793

      David R. Remer-
      Like I’ve said, “whenever” is not the center of my dispute. I agree, when 34 state legislatures want a convention, they should get it, and congress should be obligated to call it. That’s not what I’m arguing.

      Let me put this in the simplest way I can: unless 66% of our states, 34 or more call for a convention at the same time, we can’t truly say that the two-thirds majority is really there. With what you’re calling for, far fewer states would be capable of triggering that number, which would abrogate the purpose of requiring the two-thirds majority in the first place, which would be to only see these profound changes brought with consensus support of the states behind it. If just 6 states can propose amendments because 28 managed it the last time, what happened to the say of the 44 other states on the matter?

      The Amendment process deliberately gives the states these crucial powers on determining whether amendments are proposed, much less ratified. Why would you do so something which would usurp the say of the states on this matter?

      Only when we recognize separate calls for a convention as separate, is the spirit of the State’s roll in suggesting an approving amendments preserved. You can argue about what “whenever” means, I’ll argue about what role your proposal deprives the states of. Remember: the constitution, in the convention method, is supposed to be giving the states this power to call the convention. Does it make any sense to do things in a way that will be guaranteed to disenfranchise states in the process?

      Posted by: Stephen Daugherty at September 5, 2007 12:30 AM
      Comment #231795

      Stephen, you argument lacks any constitutional merit. It was NOT POSSIBLE for the 8 of the 13 original states to call for a Convention simultaneously, by virtue of some states legislatures meeting only for a few months every other year, and others more frequently and likely for less duration in some cases.

      Hence it WAS the intent of the drafters that calls for a convention from the Legislatures would come serially over time, and upon the accumulation over time, of 2/3 of the states, such a convention shall be called forth by the U.S. Congress.

      Until the passage is amended, both the language of the article, and the historical context of its writings, more than demonstrate the intent that the cumulative call by 2/3 of the legislatures WHENEVER that 2/3 majority is reached, shall cause the Congress to convene a Convention.

      If the language no longer accommodates our present circumstance or needs, it should be amended, not ignored like Republicans and you seem to be bent on doing, instead of amending it. In addition, while the framers deliberately insured that amendment and Constitutional convention should not occur in a moment of passion or easily, they also deliberately insured in the language that the hurdles to amendment and Convention should not be rendered improbable.

      Posted by: David R. Remer at September 5, 2007 12:40 AM
      Comment #231801
      womanmarine asked: So, is there a link that provides information on when these applications for this convention were made, and their text?
      Yes. Here’s a summary Here’s an older list of 523 of the 567 by state and the subject. For more information, see the FAQ link at FOAVC.ORG .
    • Posted by: d.a.n at September 5, 2007 01:24 AM
      Comment #231804
      womanmarine asked: So, is there a link that provides information on when these applications for this convention were made, and their text?
      Also, see the following. Posted by: d.a.n at September 5, 2007 01:42 AM
      Comment #231807
      Dan- First, stop saying its obvious.
      OOoooooohhh.

      But Stephen, it is obvious to me.
      It’s obvious to others.
      So far, it seems few (perhaps only you) don’t find it obvious.
      Your positions are:

      • (a)There is an implied time limit on applications.

      • (b) and/or there is a requirement for same-subject applications by the two thirds

      However, that is not what Article V states.

      The fact that the Founders had a 21 year time-limit in the very same Article V paragraph to limit changes to Article 1 corroborates the position that no time limit on Article V was by design.

      Intentional or not, the requirements have been met. All 50 states have made 567 requests for amendments. Congress must call a convention, or it is in violation of the Constitution. That’s a felony and members of Congress might be risking the consequences for it.

      Until Article V is amended to add (a)time limits, and (b)the same-subject requirements, Article V should be obeyed.

      So, either way, the arguments …

      • (a) a time limit

      • (b) and the requirement of same-subject applications
      … both have no merit.

      Posted by: d.a.n at September 5, 2007 02:09 AM
      Comment #231821

      David R. Remer-
      Let me put it plainly: I don’t expect it to be all in an instant. I’ve said a few months to a couple years before, and I’m sticking by that. Seeing as how the founding fathers could manage ratification by the required number in 9 months, I don’t see how we’ll have much of a problem.

      Posted by: Stephen Daugherty at September 5, 2007 08:51 AM
      Comment #231823

      David R. Remer-
      I could understand accumulation of the course of a year or two, but more than that? No. There’s a difference between accumulation forced by travel times, and accumulation forced by people wanting to get around having to have 34 states write in at once in a day and age where such journeys take hours.

      Your interpretation has no precedent. The list Dan provides shows repetitive calls for a convention by nearly every state, sometimes within the same year The states aren’t behaving as if your interpretation is true.

      The Framers deliberately made successful amendments unlikely. Just look at our own home state’s constitution and shudder at all the amendments we’ve packed into that poor thing. If anybody needs a constitutional convention, it’s Texas. Do we want the country’s government to operate like that? It’s made Texas a political embarrassment. Our legislature still meets just once every two years!

      Until the passage is amended, both the language of the article, and the historical context of its writings, more than demonstrate the intent that the cumulative call by 2/3 of the legislatures WHENEVER that 2/3 majority is reached, shall cause the Congress to convene a Convention.

      If you go by the cumulative method, you’ll be packing unrelated calls together. It won’t be a real majority, just one in the numbers.

      Dan-
      Since the cumulative method is not explicitly written into the constitution, Article V is being obeyed. You just don’t like it.

      Posted by: Stephen Daugherty at September 5, 2007 09:38 AM
      Comment #231825

      Stephen said: “I could understand accumulation of the course of a year or two, but more than that? No.”

      Then amend the reading of the Constitution. Ignoring it is not an option, and makes one the biggest of hypocrites to criticize the opposing party for ignoring Constitutional or legal provisions while reserving the right to do the same for oneself.

      Posted by: David R. Remer at September 5, 2007 09:49 AM
      Comment #231827

      Thanks for the links. How about one by year? With actual text? Have you proponents done any of this evaluation in that format?

      Posted by: womanmarine at September 5, 2007 10:09 AM
      Comment #231830
      Then amend the reading of the Constitution. Ignoring it is not an option, and makes one the biggest of hypocrites to criticize the opposing party for ignoring Constitutional or legal provisions while reserving the right to do the same for oneself.
      Ditto.
      Dan- Since the cumulative method is not explicitly written into the constitution, Article V is being obeyed. You just don’t like it.
      False. It is you that don’t like it the way it is written. Your interpretation is bassackwards as usual. “WHENEVER” is crystal clear. You can not read time-limits, other rules,and whatever you please into it just because you don’t like it. The text of Article V is very clear. It should be obeyed. And if you don’t like it, then you should work to amend it. But to ignore it is hypocrisy. Using your logic (oh, that’s right, logic is not allowed), we can all interpret the Constitution in vastly different ways, making the Constitution useless. Your arguments for an imaginary time-limit and same-subject-requirements have no merit. Yet, witness the arrogance to say I “just don’t like it”.
      Thanks for the links. How about one by year? With actual text? Have you proponents done any of this evaluation in that format?
      Here’s the list by year (and state) of 523 of the 567 (in Adobe PDF format). As for the original applications, those are in any library of Congress (available in the libraries of most major cities). Here’s some info (FAQ 4.9) about that. All of them would fill many volumes. But the lists (obtained from scholarly works and various court records) provided at FOAVC.ORG were acknowledged and never disputed in the law suits against Congress for violating Article V. However, we are working on getting copies of all of the actual applications and will post them when available.
    • Posted by: d.a.n at September 5, 2007 10:49 AM
      Comment #231834
      Thanks for the links. How about one by year? With actual text? Have you proponents done any of this evaluation in that format?
      Here’s an HTML list of 523 of the 567 applications sorted first by state and then by year. More info about Applications is here. 51 of the Applicaitons are about taxation. Yet, Congress continues to ignore Article V and interpret it as it pleases despite the simple and straight forward text of Article V. Congress is reading meanings into Article V that do not exist. There are no time limits and there are no requirements that applications must be the same subject.
      Article V of the U.S. Constitution: The Congress, WHENEVER {at that instant; not within any time limit} two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, OR, on the application of the legislatures of two thirds of the several states, shall call a convention for proposing amendments {amendments; there is no restriciton of same-subject amendments}, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several states, OR by conventions in three fourths thereof {Congress must choose one or the other to allow states the option to ratify the amendments}, as the one or the other mode of ratification may be proposed by the Congress; provided that no amendment which may be made prior to the year one thousand eight hundred and eight [1808] {Now, there’s an obvious 21 year time-limit; but there is no time limit on the accumulation of amendment applications; anyone that states otherwise is simply wrong and opens the interpretation of the Constitution up to all sorts of similar abuses and selective interpretations for nefarious purposes} shall in any manner affect the first and fourth clauses in the ninth section of the first article; and that no state, without its consent, shall be deprived of its equal suffrage in the Senate.
      Posted by: d.a.n at September 5, 2007 11:21 AM
      Comment #231846

      David R. Remer-
      You gave your explanation of why there was no explicit time limit thusly: if the calls weren’t allowed to accumulate, there’d be no way a convention could be called in the slow transportation days of the 1700s.

      Yet, in those days, it took less than a year to call the convention together, and less than a year to get enough folks to ratify the results. The Legislators and citizens acted not all that much slower than we would.

      You’re ignoring a major hole in your argument: there is no explicit support for accumulation. You have yet to provide evidence that accumulation of the kind you’re advocating was acceptable to the sensibilities of the Framers. You can’t simply claim this was their intent. I support my claim of their intent by pointing to the company this clause keeps, both in the Article and outside. The Congressional Override of the veto is obviously written so that only when Congress has a real consensus on the issue will the President’s veto be nullified. Similarly, only with a supermajority does an amendment pass the House and Senate as a proposal to the states; all amendments, regardless of their origins must pass in three quarters of the states. Obviously, in these cases, a requirement of some kind of supermajority backing is required, and the framers are not looking for an accidental accumulation of support. They’re looking for the bodies in these cases to actively choose these things, to come together in a consensus.

      The accumulative method, which I have never seen mentioned or practiced in American history, which I have not seen testified to in the whole of American history, and which no Supreme Court case has ever upheld, has no such company. In no other place is it suggested that calls or votes simply accumulate over time, with automatic results once a threshold is reached.

      Where does the constitution explicitly authorize votes to simply pile up? Should we allow them to similarly accumulate in all the other places where proportions of bodies are spoken of, and where straight surveys of those bodies aren’t explicitly spoken of? Your approach complicates without clarifying, and runs afoul of Ockham’s razor: all things being equal, the simplest explanation is the best. Without explicit support for long-term accumulation, the simplicity of the Contemporary call approach, it’s consonance with other standards in the constitution, and the long history of states practicing their calls in this manner all argue for its validity.

      Call me all the names you want. It doesn’t change the fact that your interpretation has never been the legal consensus, doesn’t reflect the manner in which other similar clauses are interpretated, nor does it reflect the consensuses of all the states that have repeatedly made such calls, but have not complained as far as I know about Congress not convening the convention on that account. You’re standing in very sparse company on this, and perhaps you should ask yourself why.

      Dan-
      No explicit support. Without that, you can’t say that an approach that satisfies all those conditions argues against the current, traditional method. Congress is allowed to fill in the blanks on the constitution. The Courts are allowed to interpret it- that’s their job. It’s called the Necessary and Proper Clause. It’s call judges judge. You’re taking a literalist approach to a document that was meant to be intepreted, meant to form the foundation of American government, not be the whole of American law itself.

      Your problem is that you see a nice little sledgehammer her to get the reform you want, but you don’t see how you can get the numbers all at once to get what you want. So, you buy into this because it allows you to bypass that, get what you want. Unfortunately, this kind of reading of the constitution is much like the kind that got the Bush Administration in trouble, with their indefinite extension of the President’s CINC power far beyond the scope of leading our armed forces.

      I take a very conservative approach to the constitution, which is to say I don’t like radical reinterpretations in the service of political power-plays. That’s true if it’s Bush pushing his breach of the Fourth Amendment, or folks like you trying to trigger a constitutional convention without 34 states calling for it together. If you want to push this radical reinterpretation of the convention power, you push an amendment to back it. I’ve got 220 years of state practices, legal precedent, constitutional context and common sense to back my interpretation.

      Posted by: Stephen Daugherty at September 5, 2007 01:07 PM
      Comment #231851

      Stephen,

      You are grasping at straws.

      No one is supposed to violate the Constitution.

      To pick and choose to justify violations is hypocrisy, and risks lawlessnes and invalidation of the Constitution as a whole.

      Just because Congress is violating it doesn’t justify it. With that demented logic (Ohhh…I keep forgetting; logic is not allowed), the other violations of spying without civil oversight, Habeas Corpus, torture, eminent domaain abuse, etc. are all justified too, eh ?

      I would think you would favor reforms?

      Why are you so bothered by Article V ?

      But perhaps you are in favor of ignoring Article V, which is very clear and concise, now that YOUR party is the IN-PARTY?

      Are you afraid it might reduce YOUR party’s power, opportunities for self-gain, voting themselves raises and cu$hy perk$, and ways to make their cu$hy, coveted incumbencies more secure? After all, the extreme partisan bias makes one wonder?

      Partisan bias and blind loyalty is delusional.
      Have you read Joel Hirschhorn’s book “Delusional Democracy” ?

      Posted by: d.a.n at September 5, 2007 01:30 PM
      Comment #231862

      Stephen said: “You gave your explanation of why there was no explicit time limit thusly: if the calls weren’t allowed to accumulate, there’d be no way a convention could be called in the slow transportation days of the 1700s.

      Yes. But, the very fact that the Constitution DOES NOT PROVIDE a time limit using instead, the conditional phrase, WHENEVER this occurs, requires no explanation. The explanation was for your benefit, not the Constitution’s. But, tiringly and now boringly, you continue to refute what is written for what it says. Accumulation is DIRECTLY implied by the stipulation that WHENEVER application of the legislatures of two thirds of the several states occurs, the Congress shall invoke an Constitutional Convention.

      I no longer have any respect for your engagement in this debate. Your argument and position are not founded by anything IN the Constitution nor by your perverse distortion of the language there, to mean something OTHER than what it plainly says.

      Your logic completely fails when on the one hand you stipulate that over some time accumulation is justified, but, the very absence of a time LIMIT defined by the drafters who imposed such elsewhere, on many states to, with their differing priorities and meeting schedules accumulate the requisite petitions implies there is a time limit, is just about as illogical and irrational an argument I have ever heard, and I have heard some doozies from the ‘Right’ side.

      I’m done with this. Debate serves no purpose when the adversary in the debate refuses to acknowledge the definitions of words as a basis for logic and debate.

      Posted by: David R. Remer at September 5, 2007 02:46 PM
      Comment #231872

      Dan-

      You are grasping at straws.
      Show me, don’t tell me.
      No one is supposed to violate the Constitution.
      You get a little circular here. This is a dispute about constitutional law. Each side believes that their approach satisfies the requirements for constitutionality. Whose side is better supported?
      To pick and choose to justify violations is hypocrisy, and risks lawlessnes and invalidation of the Constitution as a whole.
      So if I don’t agree with you about the constitutionality of your method of constitutional convention calling, bad things will happen? Beyond the general validity of the importance of following constitutional law, which I emphasize myself, what does this have to do with the validity of your position?

      Just because Congress is violating it doesn’t justify it. With that demented logic (Ohhh…I keep forgetting; logic is not allowed), the other violations of spying without civil oversight, Habeas Corpus, torture, eminent domaain abuse, etc. are all justified too, eh ?
      I think I have more than enough evidence across my history of Watchblog authorship to refute that claim of yours. What’s more, it’s as circular as any other claim, because it all comes back to your assertion that I’m knowingly supporting something I believe to be constitutionally invalid. You fill in what you believe to be my evil motivations, and sit back and pass judgment accordingly.

      However, as those who have read through this thread understand, I don’t take this position out of some perverse disrespect for the constitution. I in fact consider my position an upholding of it, an upholding of Democracy and popular sovereignty. Not that you have to believe that or anything, It’s just what I honestly think.

      I favor a great deal of reforms. There’s a lot of damage done by this Administration, not to mention the Republican majority in Congress. Hell, my people have done their share of damage as well. I want to see that undone. I don’t hang out on the blue column for it’s perfection, though. I really do believe in the principles of the party. Do away with the party, and I’d still believe those things.

      As for Article V? to tell you the truth, if it did happen, I wouldn’t be tearing my hair out in frustration. I just don’t think that the first constitutional convention in 220 years should be taken so lightly. There are plenty of people with axes to grind, and that convention will give people plenty of grindstones to do it with. I think you underestimate the degree to which things could get out of your control. I think you neglect the very real possibility that folks could use it to further entrench the parties, to legitimize the freakshow of unconstitutionality we’ve been going through. I am not in favor of ignoring Article V. If 34 calls come in altogether, it should be heeded.

      As I think I’ve said before, it’s not as unlikely as you think. A convention for the purpose of balancing the budget came just four states short of being called. Given the strength of sentiments right now, somebody could come through with a winner, and the convention will be called.

      As it is, my party would have a lot of backing for its policies, if such a convention came about. Have you considered what the Democrat’s newfound political advantage would mean for such a convention? You’re not thinking things through. You’re blinded by your zeal for your objectives to what might come of them.

      As for Joel’s book? I have little patience for being told that I’m delusional in the place of decent arguments for why I’m wrong. I like to be respected by others, but I don’t think I should have to jump through hoops to gain that respect.

      David R. Remer-
      You read the requirement to wait around for accumulated calls, to consider unrelated calls, into an article that really says nothing to that point.

      Understanding that, I seek external evidence to determine what the Framers likely thought it meant. That includes the apparent meaning of surrounding clauses and options, the standards and practice of the time, the interpretation over the years. I apologize if that seems boring, but I felt I owed it to you to support my opinion with more than just my own opinion.

      Words mean more than just what the dictionary says they mean, especially in law. You can’t write every important factor concerning what a law addresses into that law. That’s why we need judges, because the law can’t simply be carried out like a computer program. The deeper meaning of the law must be determined by more than just the letter.

      For me, the deeper meaning of the law relates to the calls, and how they represent what the sentiments of the states are. I don’t pick my year to two years number irrationally; the point of that is that you have state legislatures speaking for the states at that given time. Wait longer than two years, and you’ll likely have a different legislature, maybe even a different party in charge. The political continuity of a call becomes less and less likely the longer things go on. Generations change. Demographics change. Parties in power change.

      Why should the conventional calls of that time be considered valid? Why is the current sentiment of the states such a burden to your interpretation? What’s wrong with considering constitutional calls in terms of the here and the now when they’re called, so they truly, absolutely represent the political sentiments of those this clause is working on behalf of? The calls for the state were not meant to be an odometer, the convention an oil-change. They were meant to express the will of the states to change their agreed upon government. I do not see what’s unconstitutional about making the practice of calling these conventions one that identifies the sentiment of the states in a timely, clear fashion.

      Posted by: Stephen Daugherty at September 5, 2007 04:29 PM
      Comment #231879

      Stephen, As long as:

      • you dispute the definition of “WHENEVER”, and “OR”. Read the dictionary. “WHENEVER” means now. Two Thirs means 2/3. It’s very simple. Trying to obscure the simple facts and cloud the issues with gobbledygook won’t work (a common tactic used when their position is weak).

      • continue a proclivity for inventing time-limits and numeric-limits where none exist

      • ignore the other 21 year time-limit (on Article 1) changes in the very same Article V paragraph; and despite you saying in the past Stephen Daugherty wrote: “Not everything worth doing can be done in a short enough time for people just to spontaneously do it in mass movement”

      • assert that “logic” is not allowed (Stephen Daugherty wrote: “So far, you have offered nothing to support this interpretation besides pure logic.” )

      • ignore the time period (i.e. 1787), when no telephones, telegraphs, railroads, or paved highways existed; making a time limit on the accumulation of amendment requests ridiculous; it took two years for the 13 states to ratify the Constitution created at the 1787 Convention. You should know all about this since you wrote: Stephen Daugherty wrote: “Technology is a big subject for me, and I know all about it.”

      • assert it should be hard is ridiculous; the requirements are simple and straight forward; until specific and explicit times limits are defined, “WHENEVER” means now.

      • assert that “plain terms” is invalid (Stephen Daugherty wrote: “you believe that interpreting it in plain terms”)
      … then further debate is pointless, because:
      • there are no time-limits on applications (by design) in Article V

      • “OR” means Congress OR States

      • just because Congress is in violation of the Constitution on Article V (and other things too) does not provide the precedent you claim.

      • just because Congress has not yet allowed a Convention and it has not yet occurred since 1787, does not prove anything.

      • “WHENEVER” means now (not when you feel like it)

      • such nonsense is most likely explained by well-known partisan loyalties now that THEIR party is the IN-PARTY (Stephen Daugherty wrote: “Am I a partisan? I don’t think I’ve deceived anybody about this, I’ve quite openly stated my party affiliation.”; “I don’t like to hear people get down on my party [Democrat] …”, “They [voters] should be allying with us [Democrats]”; “In my opinion, the proper people to run this party are the voters who elect Democrats”; “If third parties can’t win offices, what good are they to the voter?”; “How many people curse the green party for George W. Bush getting elected?”; “MY party has an inkling”; “However much I want my party to succeed, I acknowledge that it can fail”; “The parties exists to serve our interests”; “”)

      By the way, 51 of the 567 requests were related to taxation. Perhaps we wouldn’t have the screwed-up and abused tax system we have now if Congress would obey the Constitution and call a Article V Convention to amend the tax system (and the other pending amendment applications)? It’s all too clear why Congress doesn’t want it. Many of the amendments (e.g. Term-Limits) might reduce the Congress persons’ power, opportunities for self-gain, and the security of their cu$hy, coveted incumbencies.

    • Article V of the U.S. Constitution

    • FOAVC.ORG (650 members and growing)

    • FAQ (read this; it explains away many of the issues you raised, and more).
    • Posted by: d.a.n at September 5, 2007 05:54 PM
      Comment #231896

      Stephen, spoken like a true sophist, who insists words mean whatever the sophist intends them to mean, for their own personal reasons. That’s fine for an adversarial judicial system with trial lawyers on either side. But, in case you hadn’t noticed, when a majority in a society take on the sophist’s role, that society begins to lose integrity, cohesiveness, direction and purpose, as well as the ability to democratically solve its problems.

      Contract law for example is not a sophist’s area of law. That body of law is very well defined meaning its definitions are clearly spelled out. There are many others of the Constitution which were deliberately left vague and open to interpretation by future generations in changed times, and there are others which are like contract law, well defined using well defined terminology.

      If the drafters had intended that one document containing 2/3 of the state legislatures signatures to a defined and spelled out amendment to which all parties had agreed to, be submitted at a single point in time, the Constitutional Convention that called forth shortly thereafter would never have taken place for reasons I already cited. Such language would have effectively precluded a Constitutional Convention, which was clearly NOT their intent.

      And because they honored the cumulative petitions over time by the states for the first Convention, it is clear they honored the language in Article V as written, and established the precedent of which Dan and I speak. You argument lacks any such precedent or even interpretation of the language which does not defy the definitions of the words used, to support your point of view.

      As I see it, you have lost this debate, and simply refuse to accept the fact. Which adds evidence to the growing perception that party loyalists will not let logic, reason, fact, or history interfere with their appointed rounds.

      Posted by: David R. Remer at September 5, 2007 08:52 PM
      Comment #231898

      Stephen, I do however, want to thank both you and d.a.n, for making this one of most commented articles on WB ever.

      I did enjoy the vigorous and rigorous debate with you both and Rhinehold, as well.

      Posted by: David R. Remer at September 5, 2007 09:01 PM
      Comment #231915

      David, Thanks!
      Wow. 253 comments.
      Taxes and the Constitution are heated subjects.

      Unfortunately, nothing is likely to change as long as too many voters continue to re-elect and reward the same irresponsible incumbent politicians.

      Do you think Congress’ dismal 18% approval ratings are any indication of a trend among voters to finally realizing it?

      Posted by: d.a.n at September 5, 2007 11:25 PM
      Comment #231940

      Dan-
      I do not dispute the meaning of whenever, you’re just inflexible about the unwritten meaning of “2/3rds of the state” You treat as a number, I treat it as a proportion of the states asking for a convention at a time. You think it can gather over years, I think the obvious intent of the framers is that it represents the opinion of the American states at a given point in time.

      I also told you that it was logic without reference to reality that I objected to, offering my logic with all kinds of historical and surrounding textual evidence to validate and provide sound foundation for my point. The only one twisting words here is you.

      You guys are taking a technical reading of that Amendment and asserting that it is the exclusive right interpretation of the clause. Never mind that nobody else in the history of our country has taken this interpretation, and that the states themselves, the folks you’re supposedly doing this on behalf of, act as if my interpretation holds. Are you actually asserting that everybody else in the history of this country has been reading the law wrong, and not you guys?

      Yes, it took two years for ratification of the constitution. I’ve actually said I’m comfortable with calls being made within that time period. At the same time, though, 9 of the 13 colonies signed on within Nine months. The reason for the delay with the rest was not transportation issues. Those were the states that took some convincing, and the Framers waited until they could persuade them to sign on, rather than simply declare the document ratified, as they could have. There’s a lesson in there: waiting for a greater consensus can help create better enduring institutions.

      The case for the intentional difficulty of these methods can easily be made. As David has pointed out in the past, when you’ve made your “Do-Nothing” charge about the 110th Congress, Congress has actually passed an awful lot of legislation, only to see it die in the Senate due to cloture votes, which we can’t overturn on account of the bare nature of our majority. There, too, curiously enough, we see a supermajority threshold. We see one in the number of states it takes to ratify the amendments proposed. We see one in the number of votes it takes Congress, in both houses to propose amendments and override presidential vetos. In all these cases, a simple majority could be the default. However, in each case, there’s a reason not to do it.

      In terms of overriding vetoes, it keeps the veto toothy, since it takes an overwhelming consensus, not just simple majority, to override the veto. Congress has to want it bad.

      So why have it be so difficult to get amendments proposed and passed? Put simply, the point is to keep the constitution stable, and as simple as possible. The more you complicate your basic law, the more complex you make interpreting it. So why would the founding fathers intend to create a loophole where old calls could allow a few states to drag all the rest into a convention they no longer wanted? The point of getting that large proportion, two-thirds, is to ensure that the convention is only called when there is a strong consensus among the states that it should be done. If that consensus isn’t there, the spirit of the law would be violated if the convention was called. If two thirds of the states don’t actually want the convention called, then it is contrary to the intent of the constitution. Allowing old convention calls to be disregarded serves to fulfill not merely the letter of the law, but its intent and spirit at the same time. This is what I mean by plain terms, that the meaning is integral, together through and through. I don’t dispute whenever, I just don’t think your measure of when that two-thirds majority exists actually fulfills that condition.

      It merely plays a game with the numbers and the semantics that allows conventions to be called without a successful 34 state call at one time. I believe that betrays the intention of the article, which is to prevent frivolous changes from being made by bare majorities that don’t represent the stable, overwhelming consensus of the states.

      I am a Democrat, and there’s no illusions here that I haven’t given my party tons of support. I expect something for that support, though. I expect them to behave properly, to avoid corruption, to not be weenies when I want them to have some spine. I’m a partisan, but not an apologist. I have certain firm principles that I express through my politics. That, and not some unconditional loyalty to the Party, is what drives me. Therefore, my warning in my latest post to my own party.

      People do take up partisan causes for nonpartisan reasons. As for my third party comments? I’m just being pragmatic. If third parties do not control large blocks of political power in state, local, and federal government, what can they do? I’m not questioning that third parties could be beneficial to the political landscape, I’m just speaking of what would be required for them to have strong influence.

      And yes, people do curse the Green Party for their part in the Florida part of the 2000 election.

      You take a rather harsh view of all these things I’ve said, presupposing malicious and arrogant motivations behind them. Here, as elsewhere, you look to demonize me as a brainwashed agent of the duopoly. Regarding me in that fashion prevents you from seeing that on many issues we agree, and when we disagree, it prevents you from taking my arguments at face value; you assume I agree with you, but are dishonestly pushing a false argument. That’s really not the case, and starting your attempts to pressure me otherwise from such an assumption only serves to raise the stridency of your arguments from my perspective, without any added persuasiveness to compensate.

      Posted by: Stephen Daugherty at September 6, 2007 07:20 AM
      Comment #231942

      David R. Remer-
      As I understand it, the Philadelphia convention was called as a result of the Annapolis Convention, a year previously Subsequently, all the states were able to organize together to call the Convention we know. If it was the Annapolis convention you were talking about, it’s a clear illustration of what happens when a clear consensus is not the root of such an event: only five states showed up.

      Your interpretation seems to have been completely unheard of for the last two centuries of this govenrment. You would think that by now, they would have held a convention by your standard, if it were actually active precedent, the intended result of the clause. They haven’t. Either State Governments have been getting it wrong for over two hundred years, or your interpretation is a novel one that wasn’t intended by the framers. Which is more likely?

      I might have failed to convince you of the validity of my point, but if you look at the history, at the sheer repetition of all these calls, one can only conclude that few if any legislators at the state levels have carried this interpretation throughout American history. If they did, they would have stopped making calls at whatever number was the current two thirds proportion of the states at that time, and would have called for a convention to be held on that account.

      With an accumulative standard, this would have been the logical conclusion. Yet they have let that threshold be crossed multiple times, several within the last twenty years, without all that much of an outcry. The reason I can’t give much credibility to your claims is that there is no record of any behavior by state legislators consistent with belief in this interpretation.

      For those frustrated with the Current congress, the atmosphere in Washington, this idea may seem attractive, but it’s a novel interpretation of the constitution. At best it’s an unintended loophole. At worst it has absolutely no validity. Either way, you’re going to have a hard time convincing people that this is the right interpretation.

      Posted by: Stephen Daugherty at September 6, 2007 08:03 AM
      Comment #231950

      Stephen, you are entitled to your interpretation for what it’s worth. It still does not change the facts. Without specificity, 2/3 is an accumulation and “WHENEVER” means now. It’s that simple. Your interpretations are a stretch and the only precedent you have is that Congress agrees with you to violate the Constitution.
      Due to a long history of extreme partisanship, I can only assume that is the reason for wanting to protect the status quo and the IN-PARTY.

      Posted by: d.a.n at September 6, 2007 10:01 AM
      Comment #231951

      By the way, “WHENEVER” is quite clear.
      And 2/3 is a fixed ratio.
      You argument of playing games with numbers is completely without merit.

      You are arguing a time limit, but you never say what it is. 10 minutes? one week?

      Again, I think partisan loyalties are the reason for it, and the proliferation of gobbledygook to obscure the facts and cloud the issues.

      The language is very clear.
      If you don’t like it, get an amendment to change it.
      Until then, the Constitution should be obeyed.
      Anything else is violating the Constitution.

      Interesting how some want to interpret the laws and Constitution to fit their partisan goals.

      Posted by: d.a.n at September 6, 2007 10:06 AM
      Comment #231954

      BTW, Why do you suppose Congress has such a dismal 18% approval rating (tied with the lowest rating ever)? Ohhh … that’s right. It’s the Republicans fault. Right? What has this new Do-Nothing Congress done since 7-Nov-2006? Seems like they are doing a fine job of living up to the “Do-Nothing” label.

      Are you stil happy with YOUR party?

      Perhaps PARTY really makes very little difference, and that is why nothing changes; why voters give Congress the worst approval rating ever?

      Seems to me DEMs made promises to do a lot of things and none of those promises were delivered.

      • No tax reform

      • We’re still in Iraq. Dems didn’t even use the purse strings.

      • No ethics reform.

      • Congress just passed a BILL to continue spying without civil oversight!

      • No campaign finance reform

      • Still no Habeas Corpus

      • Still printing and spending money like crazy. The National Debt just passed $9 trillion!

      • William Jefferson is still in office.

      • A miniumum wage phased in over many years. Whooopeee! And Congress gave itself 9 raises in the past 10 years. And Pelosi tried to omit Guam since she represented Starkiss; the largest employer there.

      • the borders and ports are still wide open

      • Congress is violating Article V, and a growing number of Americans are recognizing it

      • Congress has failed its duty to declare war; it has abdicated its responsibility to the Executive Branch

      • Democrats try to push through a shamnesty; finally, the voters screamed bloody murder and defeated it.

      • DEMs are pathetic on illegal immigration

      But I’m sure there is an explanation for all of that. It’s always the OTHER party’s fault. There always is where partisan bias exists. If it always the OTHER party’s fault, what good is either one? And that appears to be the most likely reason for the bias on Article V (now that the DEMs are the IN-PARTY).

      Delusional, habitual, blind partisan loyalties and voter disinterest, complacency, and apathy is the problem, and (luckily for those that liek the status quo) it isn’t likely to change … that is, not until the consequences of it become too painful.

      Posted by: d.a.n at September 6, 2007 10:33 AM
      Comment #231957

      Dan-
      I’m entitled to my opinion, just as you are. Nobody’s entitled, though, to be right. Surely, if your interpretation is correct, there must be some record in history of somebody employing it. Surely you must have researched past calls for conventions before you came to your conclusion, and found one in the formative years of our republic, or failing that later on during the twentieth century or late 1800s.

      Or are you saying that everybody else has intepreted it wrong for over 200 years? Berate me as an extreme partisan all you want to, but I can go through that list of yours and show states making calls again and again, as if they needed to be made fresh, time and again There are even multiple instances of states resubmitting the same call within the same year.

      Why, if I’m wrong, are the states not operating as if you were right? Can you answer that one simple question, preferably with something else than your stock answer of duopolistic conspiracy and bias? I’m not sure why you see the need to answer all my arguments in such an ad hominem matter. The fact that I am a Committed Democrat has no bearing on the fact that you really have brought no historical evidence to bear on your claim that this was the original intention of the Framers.

      If it was the original intent, the Framers might have spoken to that effect. Where are your quotes? If this was the intended interpretation, where are the historical records of states protesting when the 2/3rds number accumulated and Congress did nothing? Where are the publications and the editorials decrying this violation?

      All these would form a substantive basis for your interpretation. All these are absent from your presentation of the evidence.

      Most notably absent is the requirement that such calls be allowed to accumulate, explicitly written into the constitution. It doesn’t say “or should a number of calls accumulate equaling two thirds of the number of states”, it plainly states “on the application of the legislatures of two thirds of the several states”, a criteria satisfied just as well by my standard as yours. The difference is, as far as the record goes, my standard’s been in use for 200+ years, and yours seems to have come out of nowhere not too long ago.

      The law is not built on what individuals believe is right, but on what individuals agree is right between them. Americans have agreed for over two centuries that this is the way to count those calls. The very legislatures making these calls have agreed that this is the way things are done. Where the constitution is unclear on a matter, precedence, tradition, and legislation by congress determines matters. You haven’t offered anything for the first two, nor have you given us any of the last to justify your argument.

      Where is the supporting evidence? Logic, even the best, most pure, requires good evidence to produce sound conclusions. You can congratulate yourself on your proper reading of the constitution, but if the evidence doesn’t support your conclusions, then you have not a gem of an argument, but just costume jewelry.

      Posted by: Stephen Daugherty at September 6, 2007 11:33 AM
      Comment #231958

      Dan:

      Not ONE of your links and lists sorts them by year, no matter what you post. I have checked them all.

      But whatever.

      Posted by: womanmarine at September 6, 2007 11:51 AM
      Comment #231965

      womanmarine,
      Here you go. I just added a listing of applications sorted by year. The list needs to be updated. While the summary at the bottom shows all 567 requests and the year of the first application by each state, the list sorted by year (containing 523 requests) is missing 44 requests submitted since 1989.

      Dan- I’m entitled to my opinion, just as you are.
      I just wrote that above. Who said you weren’t. Still, “entitled” doesn’t equate to “correct”.
      Nobody’s entitled, though, to be right.
      Gee. Then you are wrong by your very own logic in that sentence. But then, you did write: Stephen Daugherty wrote: “So far, you have offered nothing to support this interpretation besides pure logic.” Funny how the definition of logic keeps changing too. I don’t know what dictionary you’re using or what planet it came from, but the proclivity to change the meanings of words to support weak arguments is a skill that would help one go far in D.C. Seriously, have you considered a career as a politician? After all, Congress agrees with your interpertation to violate Article V of the Constitution?

      If no one can be right, why are you trying so hard to do just that?

      That’s just a bunch of nonsense and circular gobbledygook to obscure the facts and cloud the issues; a common tactic when one’s argument is failing miserably.

      Surely, if your interpretation is correct, there must be some record in history of somebody employing it.
      My opinion is based on the clear and simple text of Article V. Just because Article V has been violated, and still is being violated, does not justify it. So that logic is full of holes as usual, and most likely the result of an obvious partisan bias to perpetuate the status quo.
      Or are you saying that everybody else has intepreted it wrong for over 200 years?
      Not everyone. Certainly not 650 members of FOAVC. Just Congress, which has an obvious conflict of interest, and those blinded by partisan bias to protect the status quo, and those with a dictionary from the planets “Cryptic Ambiguity”, “Gobbledygook”, or “Circular Logic” where the meanings of words have no meaning.
      You can congratulate yourself on your proper reading of the constitution
      Thank you so much for your permission. Face it. The text of Article V is very clear. Your arguments of precedent, imaginary time limits, and other nonsense are full of holes and directly in conflict with not only the simple meaning, but the spirit of the law too.

      Even if I didn’t want an Article V Convention, I would read Article V and have to admit that the text makes it pretty damn clear. But, then, I’m not blinded by misplaced partisan loyalties to protect the status quo.

      Posted by: d.a.n at September 6, 2007 12:59 PM
      Comment #231978

      Fred Thompson channels L. Ron Hubbard.
      Dianetics, the Tax Plan

      Posted by: womanmarine at September 6, 2007 02:06 PM
      Comment #231997
      the so-called FairTax, which has been endorsed by John McCain and Fred Thompson, as well as second-tier presidential candidates Mike Huckabee, Tom Tancredo, Duncan Hunter, and Democrat Mike Gravel. Georgians John Lindner and Saxby Chambliss have introduced FairTax legislation in the House and Senate that would establish a 23 30 percent national sales tax.
      These guys are crooks and/or not too good in math. Anyone knows any sales tax is regressive. Regressive tax means the less your income is, the higher percentage your tax is relative to your income. The pre-bates do not change that. It merely shifts the tax burden off of the poor.

      Interesting that most of them are Republicans. While BOTH parties are so corrupt that it doens’t make much difference which is more corrupt, the Republicans constantly appear to carry the water for their big money donors (i.e. the wealthy) and want appear to think the wealthy should be taxed less than the rest of us (as a percentage of income).

      A nuetral tax is preferrable to me. One that does not tax the poor (nor anyone else) on income below the poverty level, and taxes an EQUAL 17% on all income above the poverty level (and eliminate all tax loop holes; and corporate taxes thar are passed on to consumers as yet another hidden sales tax).

      I don’t know who I’ll vote for in Nov-2008, but it won’t be any politicians that:

      • (1) supports a flat sales tax

      • (2)refuses to secure the borders and ports.

      • (3)refuses to enforce existing immigration laws.

      • (4)refuses to get us out of Iraq soon.

      • (5)refuses to cut spending, pork-barrel,and waste.

      • (6)perpetuates inflation and excessive money printing.

      • (7)sells out the American workers.

      • (8)violates the Constitution

      • (9)already has a voting record undermining any of the above

      Posted by: d.a.n at September 6, 2007 03:54 PM
      Comment #232239

      Dan-
      Logic is the framework of inference. You’re saying I’m against the use of logic. No, I’m against the isolated, ivory-tower use of it, where you deem your own reason the measure of what’s right and wrong.

      You talk of my logic having holes, but all I get out of you are boasts about my logic having holes. At some point, you’ll have to go further than that.

      Like now.

      Seriously. I asked you for historical evidence. I asked you to show examples where people took your interpretation. I didn’t ask frivolously. If you can’t prove that this interepretation truly existed in this time, much less was accepted, then it makes it very unlikely that this was the interpretation favored by the framers.

      You like this interpretation, I get it. You think its correct. Fine. But your argument extends beyond personal preference, and you’re making some rather snide insinuations and outright accusations to try and bully me into accepting it.

      It matters how people saw this part of the constitution prior to the modern day, especially when original intent and the plain meaning of the article are invoked. Logically, if the plain meaning and original intent reflected your beliefs, this would be reflected in the historical record, in what the states did and did not try to do according to this clause.

      If you could provide that, you could blow my objections way out of the water. Without such historical precedence or record, though, your argument becomes something more modern, a novel interpretation that extends beyond the letter of the law (remember: no explicit requirements for accumulation of calls over time), and goes against a couple centuries of tradition and precedent.

      The evidence I ask could be the fulcrum, the hinge, by which a successful argument for your interpretation as legal requirement could turn.

      But you insist that pure reason alone will suffice. Good for fricking you. The rest of us, though, want you to sing for your constitutional supper, and prove that your notion of what the original intent was is more than just your projection of your own political agendas upon the past.

      Posted by: Stephen Daugherty at September 7, 2007 10:29 PM
      Comment #232285
      You take a rather harsh view of all these things I’ve said, presupposing malicious and arrogant motivations behind them. Here, as elsewhere, you look to demonize me as a brainwashed agent of the duopoly. Regarding me in that fashion prevents you from seeing that on many issues we agree, and when we disagree, it prevents you from taking my arguments at face value; you assume I agree with you, but are dishonestly pushing a false argument. That’s really not the case, and starting your attempts to pressure me otherwise from such an assumption only serves to raise the stridency of your arguments from my perspective, without any added persuasiveness to compensate.
      The Right has a problem, whether Republican or not: it has an elitist attitude towards the rest of the population. Whether it’s the religious right, which believes they’re morally superior, the Neocons, who believe that their resolve to defend the country is superior, or the Paleocons, who believe that their sense of economics is superior, and that those who gain power deserve it because of inherently greater worth demonstrated by success, there is a pervasive attitude among the Republicans and the right that they have to right to do just about anything to see their agenda fulfilled.

      Stephen,

      I beg of you to read these two paragraphs side by side. You ask Dan to affort you the basic consideration not to read into your motives while failing to give those in opposition to you the same courtesy, do you not?

      As for article V, I agree with most of what you have to say, but there are a few points that I think are worth considering:
      1) In regards to timing, there is not technically any limit to the ratification by the States of any particular ammendment. In proposing the Equal Rights Ammendment, Congress imposed its own timetable of 7 years (much longer than the 2 year window that you are looking for). Furthermore, it allowed for an accumulation of the approvals during that time. As the Congressional deadline approached, there were states that withdrew their ratifications. This was accepted by judicial review; however, some supporters view these withdrawls as unconsitutional. They point to the 203 years it took for the 27th ammendment to be ratified. http://en.wikipedia.org/wiki/Equal_Rights_Ammendment#Three-state_strategy This ammendment was passed under the provisions of Article V.

      The issue for timing under article V seems to be much different than timing for votes within a legislature which you seem to draw a paralell. The timing within a legislature vote are bound by the parliamentary rules which set the time period for debate and the methods for the vote. Article V on the other hand has no parliamentary basis to govern timing.

      You do seem to have some basis though based on Dillon v Gloss which allows Congress to establish a time period for ratification. http://en.wikipedia.org/wiki/Dillon_v._GlossHowever, it makes no provision that Congress has to, and as far as I can tell Congress has not in regards to an application for an Article V convention.

      On the whole, I have to side with David and Dan’s points based on this evidence. However, I agree with you that a new convention is not in the best interests of our nation at this time. Mostly, I agree with David, Congress should abide by the Constitution and based on Dillon, they should establish a specific timeframe by which the applications for the new convention can be received.

      2) Regarding transparency and the will of the people. It is well worth remembering that the original framers found transparency to be a significant barrier to the sausage-making of the original Constitution. They locked themselves away and declared complete secrecy on the entirety of the constitutional convention.

      As a second point, it was not quite so cut and dry a move from Anapolis to Philadelphia in terms of the calling of the convention. There was significant discussion during the convention that many of the attendees found the scope creep of the first constitutional convention very uncomfortable. Delegates from several states (New York, Pennsylvania, and S.C., I think) were prohibited from taking any action other than advice in regards to the construction of the constitution. Several of the delegates went directly against the directions of the States they represented in taking a more active role in the construction of the Constitution. Something they were able to do due only to the secrecy of the convention.

      3) Regarding the political parties and their genesis from the Constitutional Convention. While there is certainly some truth that the first parties had their genesis in the arguments of the convention, I think you are over-stating the case.

      Much of the move to the party system came during the Washington Administration through internal cabinet battles, and the posturing that went on to succeed him. Washington himself held no party allegiance and sought advice from Hamiliton, Madison, and Jefferson with almost equal timing and with preference set less on party lines and more on pragmatic ones.

      The divisions that truly birthed the first political parties came during the Adams administration when Jefferson and Madison broke from Adams and Hamiliton for political reasons that were born out of a combination of geography, Constitutional interpretation, and personalities.


      Posted by: Rob at September 8, 2007 03:31 PM
      Comment #232292

      Rob, Great analysis of facts and history. Possibly the best post in the thread.Thanks!

      However, it is uncertain whether an Article V Convention is (or is not) in the best interest of the nation. It could raise awareness and education among voters, even if no amendments were ever ratified. There is fear of Article V, but if we fear Article V, we may have already waited too long to make amendments.

      Posted by: d.a.n at September 8, 2007 05:12 PM
      Comment #232296
      Stephen Daugherty wrote: But you insist that pure reason alone will suffice. Good for fricking you.
      Wow. for “fricking you” ? That sounds a lot like a personal attack. Yet, below you accuse me of trying to bully you?
      Stephen Daugherty wrote: The rest of us, though, want you to sing for your constitutional supper…
      Sing? Hmmmm … how revealing? Are you so sure the “rest of us” ? After all, FOAVC has 653 members in just a few weeks (and growing every day) that believe as others in this thread that the Constitution should be obeyed (at least until the language of Article V is modified to include time limits).
      Stephen Daugherty wrote: You like this interpretation, I get it. You think its correct. Fine. But your argument extends beyond personal preference, and you’re making some rather snide insinuations and outright accusations to try and bully me into accepting it.
      Bully? Accusations? Not true. And that sounds like another personal attack. That appears to be a violation of the Rules For Participation.
        Critique the Message, Not the Messenger. This means you may critique any points made in another person’s writing or comments. But, you may not criticize the person themself, nor their right to comment at WatchBlog.

      In fact, I bet if I referred to you as “fricking you”, “bully”, and “snide” as you did to me, I’d be banned.

      Posted by: d.a.n at September 8, 2007 07:08 PM
      Comment #232338

      Rob, thanks for chiming in with additional historical and factual context. Things were getting a bit too heated, and your reason-able comment hopefully will restore some composure in the rest of us debaters.

      Posted by: David R. Remer at September 9, 2007 01:43 AM
      Comment #232448

      My pleasure. On the whole, I found this one of the more interesting debates in Watchblog. I started late, and it help my interest in three hours of catch-up reading.

      Posted by: Rob at September 10, 2007 04:10 PM
      Comment #233044

      I see the minority here has done a great job in the face of a majority who seems to be up against a paradigm shift. I never expected to see such blind opposition from those who think the Fair Tax is a scam. It seems to me, the Fair Tax is very clear. It is not hard to see that corporate taxes, which we pay now, will not be passed on to us. And we certainly wouldn’t be paying taxes on top of corporate taxes! After all they would no longer exist. Prices would come down due to market forces, and the tax we pay would equal the myriad taxes that have disappeared.

      With a broader tax base (as with the Fair Tax), taxes are likely to come down. Under the current system, trillions of dollars (the estimate is close to $11 trillion) would be repatriated. According to Alan Greenspan, that would only take a few months. Also, since the current tax system is unfair, that is one reason manufacturing has moved offshore. I once thought that globalization was unavoidable, but I’ve changed my mind. What is this inequity about taxes on manufacturing?

      Well, here is the answer, or at least one of them. You see, Europeans have what they call a VAT tax, where everything has a tax attached to it, every step of the way. But, when it reaches the US, that tax is forgiven. We don’t pay it. But, we pay all kinds of taxes on our own manufactured goods! That’s why we aren’t being fair to ourselves.

      Then, there are billions of hours and billions of dollars spent on income tax compliance. That would disappear. Corporate board meetings currently spend %80 of their time considering tax consequences to almost every decision they make. That would disappear. Companies would no longer be matching employees’ FICA, Medicare, and etc. The employee would see his entire check, with the exception of 401K contributions.

      So, once he goes to the store with his entire check, he will see lower prices. I can’t say that the tax will be exactly match the old taxes he’ll no longer be paying, but it’ll be close.

      Under the current system, people are less inclined to invest or save. With the Fair tax, people will save more. There’s no more tax on dividends or profit from the sale of stock.

      BTW, many of us are fed up with the humongous lobby business in Washington. I don’t have any figures on how big it is, but it’s not a good thing. That business would shrink, big time.

      I have more to say, but I’m going to have to hit the sack. It’s almost tomorrow by my clock, and I still have to get up and go to work. I sincerely hope you will take a closer look at the Fair Tax. There are somethings you are overlooking.

      Sincerely,
      Brian Pearson

      Posted by: Brian Pearson at September 16, 2007 12:47 AM
      Comment #233246

      Brian Pearson,

      All sales taxes are REGRESSIVE.
      Even with the prebate, that merely omits the poor from paying as much tax.
      And do you understand that it is really a 30% sales tax? The 23% number is a bit deceptive. It comes from (tax / (tax + price)) . That is, if the price is $100, the tax is $30. $30/$100 is a 30% Sales Tax. $30/($100+$30) is 23% Fair Tax. This fools a lot of people. They incorrectly think they will only pay 23% of the price, when it is actually %30 of the price. That’s probably why they don’t call it a sales tax … because they would then have to call it a 30% sales tax.

      The current tax system is a mix of a PROGRESSIVE tax system and a myriad of tax loop holes. The end result: it is also a REGRESSIVE tax system, adn that is why Warren Buffet pays a smaller income tax rate than a secretary making $60K per year.

      A PROGRESSIVE income tax system taxes income at an increasing rate as income rises. That doesn’t seem fair to me either.

      A NEUTRAL inome tax would tax income that SAME income rate (e.g. 17% for everyone).

      THERE IS A BETTER, FAIRER WAY:
      A 17% INCOME TAX RATE with the elimination of all tax loop holes, no corporate tax (that’s just a hidden REGRESSIVE tax passed on consumers), and no one pays tax on income below the poverty level.

      I have more to say, but I’m going to have to hit the sack. It’s almost tomorrow by my clock, and I still have to get up and go to work. I sincerely hope you will take a closer look at the Fair Tax. There are somethings you are overlooking.
      I have looked at it very closely. The problem is that ALL sales tax systems are REGRESSIVE. The poorer you are, the more tax you pay as a percentage of income.

      Here is a comparison of the NEUTRAL 17% income tax rate - VERSUS - the 30% Sale Tax system.

      Here is a comparison of the NEUTRAL 17% income tax rate - VERSUS - the Progressive tax system.

      Posted by: d.a.n at September 17, 2007 07:34 PM
      Comment #233275

      Actually the 27%/30% has been explained thoroughly, so it shouldn’t be considered deceptive to anyone who has read about it. “The use of the tax-inclusive number in presenting the rate has been criticized as deceptive by the plan’s opponents. Proponents argue that the 23% number represents a better comparison to income tax rates, which are presented as inclusive rates.”

      Also, under the current system, many people seem to be unaware of hidden taxes, which they are paying now. You may say the current system is progressive, but it appears to be regressive, as well. Take out all of these embedded taxes, FICA and Medicare contributions (both employee and company), remove corporate taxes, and we are approaching revenue neutrality. With lower-income groups, you’ll have people buying less, anyway, plus with high-income groups, there’ll be more buying, though at some point it does level off.

      If you also keep in mind that with a national sales tax, there is a broader base. It includes everyone —drug dealers, illegals, and etc — who buys a new item or utilizes a service. Who knows, maybe the tax will go down.

      The site you linked to alleges that the underground market would explode. There is nothing to substantiate that. Plus, there is every reason to believe there would be as much evasion by your flat tax than with the current system.

      Your site also alleges that a new system would have to be set up for tax collection. Not true. Forty-five states already have a sales tax, and there is very little problem with it. That counters your site’s allegation that a whole new system would have to be developed. States would be given a fee, perhaps 1%, to handle the collections just as they have with their current sales taxes. Likewise, business would be paid a similar fee. Also, people would have an incentive to report who lives in their household, along with SS numbers, so they can be paid their monthly prebate. The Social Security Administration can handle that part; after all, they send out payments monthly, already, along with annual reports to anyone on the SS rolls.

      Some detractors suggest that there will be a much larger demand for used items, since under the Fair Tax, nothing used will be taxed. Market forces would drive used prices higher, as I see it, until it stabilizes.

      The site says that savings would be taxed again, once it is spent. With the current savings rate near zero, or less, I’d say that is a non-issue. In fact, with the FairTax, there would be more people saving and investing, thereby invigorating the economy.

      The flat tax proposal says the 16th Amendment would have to be repealed. Why? I disagree. Fairtax proponents call for the repeal of the 16th, to make sure the old broken method is not brought back. But the entire income tax code would be wiped clean with passage of the Fairtax.

      I hope that helps — Brian

      Posted by: Brian Pearson at September 17, 2007 11:53 PM
      Comment #233336

      First, thank for your comments and polite and respectful delivery.

      Brian Pearson wrote: Actually the 27%/30% has been explained thoroughly, so it shouldn’t be considered deceptive to anyone who has read about it.
      Apparently not, since some people (not just opponents either) in this very thread thought it was a 23% Sales tax and even incorrectly calculated the tax as $23 on a $100 price. If you review the thread above, you will see that very sort of confusion occurred.
      Brian Pearson wrote: “The use of the tax-inclusive number in presenting the rate has been criticized as deceptive by the plan’s opponents. Proponents argue that the 23% number represents a better comparison to income tax rates, which are presented as inclusive rates.”
      And that is why they do not call it a sales tax. Because if they did, they would have to call it a 30% Sales tax. That is a little curious, don’t you think?
      Brian Pearson wrote: Also, under the current system, many people seem to be unaware of hidden taxes, which they are paying now.
      Yes, the current tax system is REGRESSIVE because of a myriad of tax loop holes. Yes, corporate taxes are passed on as hidden taxes to consumers as a REGRESSIVE, hidden tax.

      But there is a better way that uses a NEUTRAL 17% Income Tax,
      AND eliminates all tax loop holes,
      AND does not tax any income below the poverty level (similar, but much more simple and efficient than a pre-bate system as that within the 30% Sales tax system).

      Brian Pearson wrote: You may say the current system is progressive, but it appears to be regressive, as well.
      Exactly. You are 100% correct. That was acknowledged above. Warren Buffet (2nd wealthiest person in the country) can confirm it to. Even he doesn’t think it is fair.
      Brian Pearson wrote: Take out all of these embedded taxes, FICA and Medicare contributions (both employee and company), remove corporate taxes, and we are approaching revenue neutrality.
      Not true. That would never make a 30% Sales tax (even with pre-bates) NEUTRAL. It is mathematically impossible. All sales taxes are REGRESSIVE.
      Brian Pearson wrote: With lower-income groups, you’ll have people buying less, anyway, plus with high-income groups, there’ll be more buying, though at some point it does level off.
      Not true. The lower income groups have to spend most (if not all) of their income just to get by. 60% of the U.S. population only has 5% of all wealth in the U.S. 40% of the U.S. population has less than 1% of all wealth. 1% of the U.S. population has 40% of all wealth. The only way any sale tax system is not REGRESSIVE is if everyone spends ALL of their income. That is not likely.

      The wealthier people become, the less likely they are to spend all of their income. Especially if it is taxed 30% with it is spent.
      The poor have less of (or no) choice.
      Again, no matter how you slice it, ALL sales taxes are REGRESSIVE.
      The FairTax.org plan is a 30% Sales tax with a pre-bate and elimination of other federal taxes.
      That is still a REGRESSIVE tax system.
      There is no way to prove it is not.

      The only tax system that is NEUTRAL is a tax system that taxes income an equal percentage rate.

      Brian Pearson wrote: If you also keep in mind that with a national sales tax, there is a broader base. It includes everyone —drug dealers, illegals, and etc — who buys a new item or utilizes a service. Who knows, maybe the tax will go down.
      Drug dealers? Sorry, but that still does not change the nature of any sales tax. It is still REGRESSIVE. And as far as illegal aliens go, that’s a separate issue, and that does not stop illegal aliens from using our schools, hospitals, ERs, welfare, Medicaid, and even voting in our elections.

      Also something commonly omitted by the FairTax.org plan and proponents is that salaries would have to be reduced.
      That is, the system can not magically adjust.
      When there are no more income taxes and Social Security and Medicare taxes withheld, the employers must reduce salaries accordingly.
      The elimination of those taxes must be funded by a reduction in salary.
      Corporations can’t deduct those taxes anymore, so they must reduce salaries.
      Of course, that would be compensated by the potentially lower prices and elimination of hidden taxes, but it would still be a REGRESSIVE tax system.
      That is an unavoidable fact that will doom the FairTax.org plan.
      And watch how many people will be angered by these facts.
      That mere gives credence to the truth of these inconvenient facts.

      Brian Pearson wrote: The site you linked to alleges that the underground market would explode. There is nothing to substantiate that.
      Not true. There is substantial historical evidence that shows all sales taxes breed black markets. As sales taxes (and tarrifs and fees) grew, so do black markets. A very good example is occurring now with the huge sales taxes being put on cigarettes. That has created a huge blackmarket for cigarettes. I know people that actually drive to different states to buy cigarettes and bring them across state lines (which is illegal in some states). Such a large, single 30% sales tax will guarantee black markets.

      In addition, there are hundreds of thousands of times more sales transactions than incomes.
      Which is easier to monitor?
      Because both employees and employers have a vested interest in verifying income tax withholding. But that is not so with sales taxes. In fact, the monitoring and verification of sales transactions would be an accounting nightmare, if not simply impossible.

      Brian Pearson wrote: Plus, there is every reason to believe there would be as much evasion by your flat tax than with the current system.
      Not true.

      Already, the current average income tax rate is 20%.
      So why would they rebel against a 17% tax rate more than a 20% tax rate?
      Also, the vast majority of Americans will be happy to see the wealthy finally paying an EQUAL percentage (unlike now, where Warren Buffet pays a lesser income tax rate than a secretary making $60K per year).

      And remember, with the 17% Income Tax plan, all corporate taxes (costs passed onto consumers as hidden taxes) are eliminated too.
      So that argument does not hold up to careful examination either.

      Brian Pearson wrote: Your site also alleges that a new system would have to be set up for tax collection. Not true. Forty-five states already have a sales tax, and there is very little problem with it.
      Yes, a new system would be required.

      Some states don’t have sales taxes.
      And most merchants collect sales, city, and country taxes. Not federal taxes.

      Now add a 30% national sales tax to a 8.5% city/county/state tax which adds up to a huge 38.5% sales tax. Yikes!
      And you seriously do not think that won’t breed black markets?
      Even if the FairTax.org plan wasn’t a REGRESSIVE tax system, that whopping 38.5% sales tax is impossible to not notice.
      As Craig Holmes noted above, any single tax that is so large will breed black markets.

      Brian Pearson wrote: That counters your site’s allegation that a whole new system would have to be developed.
      Not true. There would need to be a new system for collecting federal sales taxes. And there would need to be ways to enforce it. State and local authorities are not going to foot the bill for that. And I would even venture to there is a high probability that some cities, counties, and states will steal part of it. Still, new systems would be needed that send a portion of the sales tax money to the federal government (something that currently does not exist).
      Brian Pearson wrote: States would be given a fee, perhaps 1%, to handle the collections just as they have with their current sales taxes. Likewise, business would be paid a similar fee.
      There are hundreds of thousands of more sales transactions than the number of incomes (nationwide).

      Thus the effort to track all of it, enforce it, and collect sales taxes (including the 1% fee you mentioned) is much more complicated.
      And again, add a 30% national sales tax to a 8.5% city/county/state tax which adds up to a 38.5% sales tax, and you can guarantee black markets will abound. Enforcement will be difficult and costly.

      Brian Pearson wrote: Also, people would have an incentive to report who lives in their household, along with SS numbers, so they can be paid their monthly prebate.
      The pre-bate is ripe for abuse.

      Ever heard of Medicaid fraud?
      Social Security fraud?
      Medicare fraud?
      Welfare fraud?
      Anytime the federal government becomes the guarantor of payments, it breeds fraud.
      With a 30% National Sales, we’d have a whole lot more people with their hands in the cookie jar.

      Brian Pearson wrote: Some detractors suggest that there will be a much larger demand for used items, since under the Fair Tax, nothing used will be taxed.
      I suppose that might happen, since avoiding such a large 30% sales tax would be a definite motivation.
      Brian Pearson wrote: Market forces would drive used prices higher, as I see it, until it stabilizes.
      But, also, such a huge 30% sales tax could motivate people to drive their old car, or lawn mower, or old microwave longer and longer too. Again, such a single, huge tax on sales will most definitely be very visible … and will most likely give rise to more black markets too.
      Brian Pearson wrote: The site says that savings would be taxed again, once it is spent. With the current savings rate near zero, or less, I’d say that is a non-issue.
      False.

      The ZERO savings rate is an nationwide average.
      40% of all Americans have little savings.
      However, 60% do have some savings.
      Those savings have ALREADY been taxed via income tax.
      With a 30% National Sales tax, they will be taxed again when they spend it, and that still applies to 60% of the population.

      Brian Pearson wrote: In fact, with the FairTax, there would be more people saving and investing, thereby invigorating the economy.
      It can’t. No REGRESSIVE tax, and especially a single, huge 30% Sales tax that will create more black markets, can invigorate the economy. It will worsen the REGRESSIVE trends that have been increasing disparity since 1980.
      Brian Pearson wrote: The flat tax proposal says the 16th Amendment would have to be repealed. Why? I disagree.
      Yes, it would clearly need to be changed to allow taxation for sales taxes. The 16 Amendment allows for income taxes. Not sales taxes. And opponents to the FairTax.org plan will capitalize on that very issue.
        Amendment XVI: The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.
      See above. It quite clearly states “income”. Not sales taxes.
      Brian Pearson wrote: Fairtax proponents call for the repeal of the 16th, to make sure the old broken method is not brought back. But the entire income tax code would be wiped clean with passage of the Fairtax.


      Brian Pearson wrote:
      I hope that helps — Brian

      Not really. I’ve heard all of these same counter-arguments for the 30% National Sales tax many times, and each and every one fail to stand up to close scrutiny.
      That’s not a denigration of your efforts.
      It is simply that ALL sales taxes are REGRESSIVE, and that is a mathematical certainty.
      Because of that, it is unfair (because REGRESSIVE taxes increase income taxes as income decreases).

      The best tax is a NEUTRAL tax.
      I also do not support a PROGRESSIVE tax (increase income tax rate as income increases) for the very reasons I reject any REGRESSIVE tax.

      The tax system that is the most fair, and taxes the least possible amount will be the tax with the largest complicance and efficiency.

      Take another look at these four tax systems and the analysis above.
      Are you sure you want a REGRESSIVE 30% National Sales Tax system?

      Posted by: d.a.n at September 18, 2007 05:22 PM
      Comment #233337

      There is no reasonable equity of distribution under the current INCOME tax system. What’s more, the Tax Code has become a “tinkerer’s paradise” for 53% of the lobbyists who game it in Washington DC. It’s a lucrative business, and the U.S. TAXPAYER pays for ALL of it in higher prices (i.e., a hidden tax which is incomprehensible to the average working person).

      Prices after FairTax passage would look similar to prices before FairTax - not “30% higher” as opponents contend - competition would see to it. So, the FairTax rate (figured as an income-tax-rate-non-comparative, sales tax) on new items would be 29.85% (on the new, reduced cost of items because business isn’t taxed under FairTax - thus lowering retail prices by 20% to 30%), or 23% of the “tax inclusive” price tag - this is the way INCOME TAX is figured (parts of the total dollar).

      The effective percentages, that different income groups would pay under the FairTax, are calculated by crediting the monthly “prebate” (advance rebate of projected tax on necessities) against all likely spending that citizen families (1-member and greater, Dept. of HHS poverty-level data) are likely to spend. (A single person would receive ~$200/mo. A family of four ~$500 - in addition to working members no longer having tax withholding confiscated from the fruits of their labor every two weeks.) Prof.’s Kotlikoff and Rapson (10/06) concluded,

      “…the FairTax imposes much lower average taxes on working-age households than does the current system. The FairTax broadens the tax base from what is now primarily a system of labor income taxation to a system that taxes, albeit indirectly, both labor income and existing wealth. By including existing wealth in the effective tax base, much of which is owned by rich and middle-class elderly households, the FairTax is able to tax labor income at a lower effective rate and, thereby, lower the average lifetime tax rates facing working-age Americans.

      “Consider, as an example, a single household age 30 earning $50,000. The household’s average tax rate under the current system is 21.1 percent. It’s 13.5 percent under the FairTax. Since the FairTax would preserve the purchasing power of Social Security benefits and also provide a tax rebate, older low-income workers who will live primarily or exclusively on Social Security would be better off. As an example, the average remaining lifetime tax rate for an age 60 married couple with $20,000 of earnings falls from its current value of 7.2 percent to -11.0 percent under the FairTax. As another example, compare the current 24.0 percent remaining lifetime average tax rate of a married age 45 couple with $100,000 in earnings to the 14.7 percent rate that arises under the FairTax.”

      Further, per Jokischa and Kotlikoff (circa 2006?)

      “…once one moves to generations postdating the baby boomers there are positive welfare gains for all income groups in each cohort. Under a 23 percent FairTax policy, the poorest members of the generation born in 1990 enjoy a 13.5 percent welfare gain. Their middle-class and rich contemporaries experience 5 and 2 percent welfare gains, respectively. The welfare gains are largest for future generations. Take the cohort born in 2030. The poorest members of this cohort enjoy a huge 26 percent improvement in their well-being. For middle class members of this birth group, there’s a 12 percent welfare gain. And for the richest members of the group, the gain is 5 percent.”

      Posted by: Ian at September 18, 2007 05:58 PM
      Comment #233744

      The bottom line is this: ALL Sales Taxes are REGRESSIVE.

      The FairTax.org plan is a 30% National Sales Tax.

      Therefore, the FairTax.org plan is a REGRESSIVE tax. And a big one too (e.g. 30% !).
      Don’t be fooled by the 23% tax rate stated. Based on the confusion, and some people that were fooled into not realizing it is really a 30% sales tax, appears to be a clever way to make the huge 30% look smaller.
      A sales tax is know as a percentage of price.
      For example, a 30% Sales Tax on $100.00 is $100.00 x 0.30 = $30.00 .
      The 30% is calculated as $30 / $100.00
      The 23% is calculated as $30 / ($100.00 + $30.00)
      Does that bug you?
      If it is a sales tax, why play games like this to disguise it as something else?

      This nation already has too many other sales taxes already, and ALL of those sales taxes are REGRESSIVE.

      Therefore, if you support the FairTax.org plan, that is fine. You then support a tax system that is REGRESSIVE. There is NO mathematical way to prove any sales tax is not REGRESSIVE.

      All the examples, tables, and long-winded reports and studies can NOT change one simple fact; a mathematical certainty: ALL sales taxes are REGRESSIVE.
      Even if a sales tax lowered prices, a sales tax is still REGRESSIVE.
      Even if a prebate is provided (a low-income deduction), a sales tax is still REGRESSIVE.
      The pre-bate is simply a threshold like many other plans to not tax income below a certain level. However, the pre-bate will be a mess, ripe for abuse, and totally unnecessary since the smarter thing to do is simply don’t tax income below a certain level (which requires no money changing hands at all; no mass mailing of checks and/or deposits to bank accounts, etc.). Any time the government is the guarantor of payment, there is widespread abuse, fraud, confusion, and cost.
      The ONLY way a sales tax can not be REGRESSIVE is if everyone spends all of their income, in which case every one’s income is taxed an equal 30%.
      The wealthy are very unlikely spend all of their income.
      The poor are most likely to spend all of their income just to get by.
      The middle income group is likely to spend most of their income just to get by (even if they live modestly).

      That document referenced above (Jokischa and Kotlikoff) lacks any credibility because (many times) it calls a payroll tax REGRESSIVE.
      A payroll tax can not be REGRESSIVE unless the tax rate increases as income decreases. Our current graduated tax scale is PROGRESSIVE. The reason our current tax system is REGRESSIVE is only because of a myriad of abused tax loop holes. Not because it is a payroll tax. That statement is false.
      All that is really needed to fix the current tax system is to remove ALL tax loop holes, make the income tax rate a flat 17%, don’t tax any income below the poverty level, and eliminate corporate income taxes that merely get passed onto consumers as another hidden and REGRESSIVE sales tax.

      Posted by: d.a.n at September 21, 2007 12:46 PM
      Comment #233885

      No one who has read about the FairTax is “fooled”. This is not a gimmick. The FairTax was described both as an “inclusive” rate and an “exclusive” rate. The inclusive rate makes it comparable to the current tax system.

      You are underestimating the degree to which goods and services will be affected. Compliance costs run into billions of dollars and many billions of hours. Also, the FICA, Medicare and so forth, once subtracted will mean goods and services can bring their prices down. Other embedded taxes, such as corporate taxes, gas taxes and other taxes and fees (too many to list, here, though if you want, I can give you a link to them all) will disappear. The FairTax is designed neither to be progressive, nore regressive, which is one reason it is called the “FairTax”.

      This money is being spent, now and it is both regressive and progressive. Some people say lower income brackets don’t pay taxes, but that is absolutely not a true statement.

      I submit that it is a bit misleading to compare “rates” between low income people and high-income people. People who make ten or a hundred million a year are going to be paying a lot more than those who are in low-income brackets. The higher brackets pay most of the taxes, today, though people who supposedly don’t pay taxes are still feeling the pinch. With the prebate, which is based upon official poverty figures, low-income people will be better off. Some, like yourself, say that it is mathematically impossible for the figures (lower costs = sales tax paid) to come out as planned, but I’ve not seen any convincing evidence to the contrary. I would agree that the sales taxes of today are regressive. It is the prebate plus lower prices, that makes the FairTax fair.

      A number of well-respected people got together for a period of time hammering out a way to make taxes fair. I believe they’ve done an excellent job.

      Posted by: Brian Pearson at September 21, 2007 10:47 PM
      Comment #234006
      Brian Pearson wrote: No one who has read about the FairTax is “fooled”. This is not a gimmick. The FairTax was described both as an “inclusive” rate and an “exclusive” rate. The inclusive rate makes it comparable to the current tax system.
      You can’t know that for certain. I know people that claim to understand it that did not realize the 23% FairTax.org plan was really a 30% Sales tax.
      Brian Pearson wrote: You are underestimating the degree to which goods and services will be affected.
      False.

      The effect on goods and services under any REGRESSIVE tax will be negative, and the FairTax.org’s 30% Sales Tax is REGRESSIVE (as income decreases, tax as a percentage of income increases). All REGRESSIVE taxes will negatively affect goods and services.

      Brian Pearson wrote: Compliance costs run into billions of dollars and many billions of hours.
      I can easily see how compliance costs with a 30% National Sales tax will be worse, since there will be hundreds of billions of sales transactions per year versus hundreds of millions of incomes. In addition, a huge 30% Sales tax combined with 8.5% for state, city, and country taxes will result in a whopping 38.5% sales tax.

      And you seriously don’t think that won’t cause black markets?
      It will breed black markets.
      Therefore, the compliance argument is about as lame as they come.
      In addition, with the 17% NEUTRAL INCOME TAX plan, costs to calculate taxes are minimal since there are no tax loop holes, no creative accounting, and no need to do much more than multiply your income over the poverty level times 0.17 . Can’t get much simpler than that.

      Brian Pearson wrote: Also, the FICA, Medicare and so forth, once subtracted will mean goods and services can bring their prices down.
      The 17% NEUTRAL INCOME TAX plan does not have any caps for Social Security and Medicare. Social Security and Medicare taxes are combined with the 17% NEUTRAL INCOME TAX. Thus, it is simple, NEUTRAL, SIMPLE, and FAIR.
      Brian Pearson wrote: Other embedded taxes, such as corporate taxes, gas taxes and other taxes and fees (too many to list, here, though if you want, I can give you a link to them all) will disappear.
      The 17% NEUTRAL INCOME TAX plan eliminates corporate taxes because those are simply passed on to consumers as a REGRESSIVE hidden tax.

      As for all other sales taxes on gasoline, etc. Those are all separate taxes. ALL sales taxes are REGRESSIVE. I’d recommend states eliminate ALL sales taxes and implement a similar NEUTRAL income tax.

      Brian Pearson wrote: The FairTax is designed neither to be progressive, nore REGRESSIVE, which is one reason it is called the “FairTax”.
      False.

      ALL sales taxes are REGRESSIVE.
      Especially a massive 30% Sales Tax.
      There is NO way to prove otherwise.
      It is not mathematically possible to show a sales tax as PROGRESSIVE unless everyone spends all of their income.
      The best you can ever hope for with any sales tax is that it is effectively NEUTRAL if everyone spends ALL of their income (which ain’t likely).

      Therefore, the “FairTax” is the farthest thing from “fair”.
      If the 30% Sales Tax was NOT REGRESSIVE, you can bet their web-site would prove it.
      The reason that proof does not exist is because it is impossible, because ALL sales taxes are REGRESSIVE.

      Brian Pearson wrote: People who make ten or a hundred million a year are going to be paying a lot more than those who are in low-income brackets.
      The issue is not nominal amounts of tax paid.

      The issue is the tax as a percentange of income.
      That should be EQUAL.
      Some want it to be PROGRESSIVE (increase the rate as income increases).
      However, I have the same philosophical problem with PROGRESSIVE taxes that I have with REGRESSIVE taxes.
      Both are not fair.
      But REGRESSIVE taxes are the most hideous because they increase the income tax rate as income decreases (as ALL sales taxes do).

      Brian Pearson wrote: The higher brackets pay most of the taxes, today, though people who supposedly don’t pay taxes are still feeling the pinch.
      Again, the issue is not nominal amounts of tax paid.

      The issue is the tax as a percentange of income (which to be fair should be NEUTRAL).

      Brian Pearson wrote: With the prebate, which is based upon official poverty figures, low-income people will be better off.
      The prebate does not make the 30% Sales Tax less REGRESSIVE. The prebate is nothing more than a poverty level deduction of sorts. The 17% NEUTRAL INCOME TAX plan simply does not tax income below the poverty level, rather than mess with the problems of prebates.
      Brian Pearson wrote: Some, like yourself, say that it is mathematically impossible for the figures (lower costs = sales tax paid) to come out as planned, but I’ve not seen any convincing evidence to the contrary.
      Then you need to take some math courses.

      If you do not understand that it is mathematically impossible for any flat 30% Sales Tax to be PROGRESSIVE, then argument about it is useless, and you will believe as you wish.

      Brian Pearson wrote: I would agree that the sales taxes of today are REGRESSIVE.
      Not sales taxes of today. A N Y flat sales tax. The best any flat sales tax can be is NEUTRAL and that is ONLY if everyone spends all of their income (which ain’t likely).
      Brian Pearson wrote: It is the prebate plus lower prices, that makes the FairTax fair.
      False.

      The prebate is only a dedection that everyone receives. It simply changes the starting point. That’s all. It simply exempts income below a certain point.

      Brian Pearson wrote: A number of well-respected people got together for a period of time hammering out a way to make taxes fair.
      If the goal was fairness, then they failed miserably.

      Calling something fair doesn’t mean it is true. It might fool some people, but it doesn’t fool me. I will admit that it fooled me in the beginning. But the turning point was that nobody at FairTax.org could prove to me that it wasn’t a REGRESSIVE tax.

      Brian Pearson wrote: I believe they’ve done an excellent job.
      Regardless of any prebate, ALL sales taxes are REGRESSIVE.

      If you support a REGRESSIVE tax system, fine. You support increasing income tax rates as income decreases.
      If you think a 30% Sales Tax is not REGRESSIVE, you are simply wrong.

      Here are some facts and if you want to disbelieve these facts, that is your choice.
      But I would hope that you would want to know the truth rather than erroneously support something that isn’t what you thought it was.

      FACT # 1: a flat sales tax can never be a PROGRESSIVE TAX. That is a mathematical certainty.
      FACT # 2: a flat sales tax can never be anything but a REGRESSIVE TAX unless everyone spends all of their income.
      FACT # 3: a flat sales tax is always a REGRESSIVE TAX unless everyone spends all of their income.
      FACT # 4: a flat sales tax can ONLY be a NEUTRAL TAX if everyone spends ALL of their income.
      FACT # 5: since everyone doesn’t spend all of their income, all flat sales taxes are always a REGRESSIVE tax.

      DEFINITIONS1:

      • REGRESSIVE TAX: income tax increases as income decreases;

      • PROGRESSIVE TAX: income tax increases as income increases;

      • NEUTRAL TAX: income tax is constant regardless of income;

      Brian Pearson wrote: A number of well-respected people got together for a period of time hammering out a way to make taxes fair.
        Some of the experts funded include:

        Professors David Burton and Dan Mastromarco, University of Maryland and The Argus Group
        Laurence Kotlikoff, Boston University
        Stephen Moore, The Cato Institute
        Professor Dale Jorgenson, Harvard University
        Bill Beach, the Heritage Foundation
        Jim Poterba, The National Bureau of Economic Research
        Professor George Zodrow, Rice University and the Baker Institute for Public Policy
        Professor Joseph Kahn, Massachusetts Institute of Technology

      Well, I don’t respect them because they either promote:
      • (1) a sales tax that is REGRESSIVE.
      • (2) or do not know it is REGRESSIVE.
      • (3) or do know it is REGRESSIVE, and don’t care.
      • (4) or know it is REGRESSIVE and hope few will notice.

      Here’s some advice.
      Use it or ignore it.
      The choice is yours.
      If you are not OK with a REGRESSIVE tax system, then do not try to promote this tax system.
      If you know it is a REGRESSIVE tax system, and don’t care, then that’s your choice.
      If you are just believing what people tell you without proving it for yourself, that is why you now find it difficult to explain and prove any flat sales tax is not REGRESSIVE.
      Prove it to yourself and then you won’t be in the uncomfortable position of trying to prove something that is not true.

      Posted by: d.a.n at September 22, 2007 10:31 PM
      Comment #234009

      Brian Pearson,
      Look closely at this NEUTRAL 17% INCOME TAX plan.
      It is better in many ways.
      It is a simplification of the existing system.
      It is the easiet system to implement.
      It is a NEUTRAL income tax (neither REGRESSIVE or PROGRESSIVE). It taxes all income an EQUAL percentage and eliminates ALL tax loop holes.
      It doesn’t tax anyone’s income below the poverty level (i.e similar to a prebate, but no prebate is necessary; the income tax simply isn’t withheld until it exceeds the poverty level; no sense in taxing below the poverty level and unnecessarily pushing people onto welfare; no need for the complexity and potential abuses of a prebate system).
      It doesn’t impose an income tax corporations because those are simply passed through as REGRESSIVE hidden taxes on consumers.
      Feel free to comment on it.

      Posted by: d.a.n at September 22, 2007 10:42 PM
      Comment #235726
      The bottom line is this: ALL Sales Taxes are REGRESSIVE.

      The FairTax.org plan is a 30% National Sales Tax.

      Therefore, the FairTax.org plan is a REGRESSIVE tax.

      I’m sorry, but I still have not seen you demonstrate how the Fair Tax can possibly be regressive. Your logic does not follow.

      Brian

      Posted by: Brian Pearson at October 9, 2007 11:34 PM
      Comment #235899
      Brian Pearson wrote: I’m sorry, but I still have not seen you demonstrate how the Fair Tax can possibly be regressive. Your logic does not follow.

      Brian Pearson,
      First of all, you have not proven that the FairTax.org’s 30% Sales Tax is NOT regresssive.

      Nevertheless, I’ll prove that the FairTax.org’s 30% Sales Tax is REGRESSSIVE.
      It’s not difficult, because it is a mathematical certainty that all flat sales taxes are REGRESSIVE, regardless of the prebate.

      P R O O F that ALL Flat Sales Taxes (with prebate or not) are Still Regressive:
      Let’s say the prebate is $2400 (as in the FairTax.org’s example on their web-site).
      That $2400 is essentially the 30% sales tax on $8000, so you could say that the first $8000 of income was not taxed.
      However, under the 17% Income Tax plan, income below the poverty level (e.g. $8000 or even higher) would not be taxed either.
      So those two tax systems are essentially the same for the first $8000 of income (i.e. no tax on the first $8000).
      Under the current tax system (which is ridiculously complex, abused, and REGRESSIVE due to thousands of tax loopholes), the personal deduction is aobut $3300 ($6600 for a married couple).
      So, all three of those tax systems have what amounts to a deduction.

      Therefore, for the following annual incomes with a deduction for the first $8K:

      • Person making $10K above the 1st $8K spends $10K. Total Sales Tax paid=$3.0K ; that equals a 30.0% income tax on income above the 1st $8K, and 16.7% in gross income.

      • Person making $20K above the 1st $8K spends $19K. Total Sales Tax paid=$5.7K ; that equals a 28.5% income tax, and 20.4% on gross income.

      • Person making $30K above the 1st $8K spends $25K. Total Sales Tax paid=$7.5K ; that equals a 25.0% income tax, and 19.7% on gross income

      • Person making $50K above the 1st $8K spends $40K. Total Sales Tax paid=$12K ; that equals a 24.0% income tax, and 20.7% on gross income.

      • Person making $100K above the 1st $8K spends $60K. Total Sales Tax paid=$18K ; that equals a 18.0% income tax, and 16.7% on gross income.

      • Person making $1 Million above the 1st $8K spends $500K. Total Sales Tax paid=$150K ; that equals a 15.0% income tax, and 14.9% on gross income.

      • Person making $10 Million above the 1st $8K spends $4.0 Million. Total Sales Tax paid=$1.2 Million; that equals a 12.0% income tax, and 12.0% on gross income.

      • Person making $100 Million above the 1st $8K spends $35 Million. Total Sales Tax paid=$10.5 Million; that equals a 10.5% income tax, and 10.5% on gross income.

      There is the proof.
      It’s really just simple arithmetic.
      Notice how the tax rate decreases as income increases (and the tax rate increases as income decreases).
      ALL sales taxes (regardless of a prebate which is similar to a standard deduction) are REGRESSIVE, unless everyone spends ALL of their income.
      The ONLY way a flat sales tax can not be REGRESSIVE is if everyone spends ALL of their income, and that is much more likely for the poor than the wealthy.
      The less wealthy spend more (or all) of their income, and are therefore taxed a higher rate as a percentage of their income.
      17% Income Tax versus 30% National Sales Tax

      Posted by: d.a.n at October 11, 2007 08:12 PM
      Comment #236021

      Aside from disagreeing slightly to your figures. For example —

      1) First person makes 18k and spends 10k is taxed on 2k which would be .3*2000=600

      2) Second person makes 28k and spends 19k and is taxed on 11k which would be .3*11000=3300…

      Keep in mind that with all so-called hidden costs gone, prices will come down, which is why the taxes will balance out to zero. Nice, huh?

      Posted by: Brian Pearson at October 12, 2007 09:54 PM
      Comment #236070
      Brian Pearson wrote: Keep in mind that with all so-called hidden costs gone, prices will come down, which is why the taxes will balance out to zero. Nice, huh?
      OH … but you conveniently omitted that salaries must fall since employers are no longer withholding income tax, Social Security tax, and Medicare tax. Whhhhooooopssss. So sorry. We forgot that little detail.

      Hidden costs?
      Oh yes. That’s the magic of the FairTax.org.
      Never mind the math.
      Just allege pure nonsense.
      Fact don’t matter.
      Don’t do the arithmetic for yourself.
      Just blindly take the word of others without doing any of the math for yourself.
      Yeah, that makes a lot of sense, eh?

      And that is why the FairTax.org tax plan has NO credibility. And I will fight to no ends to undermine it, because it is dishonest and REGRESSIVE.
      You can believe what ever you want, but I’ve done the real math and it doesn’t make any sense, and I will do my best to let ALL Americans know it.

      Posted by: d.a.n at October 13, 2007 10:01 PM
      Comment #236079

      d.a.n, quite right. And do not forget that the sales tax is only the center bouquet of the GOP’s grand design to impose User Fees on everything. Receive mail from the government, user fee added to taxes at end of year, travel a federal funded highway, toll road it will be called, make a phone call, gotcha, user tax payable to Congress. A sales tax is the grandaddy of all user fees, and the GOP argues if you don’t like the sales tax, don’t purchase anything. As if anyone could live without making purchases in this country anymore. Well, the Unibomber excepted, perhaps.

      But the sales tax would unquestionably be accompanied by a slew of innovative user fees as time went on because Congress politicians would quickly realize raising the sales tax rate would cost them elections, but, user fees passed as embeds in other Bills, well, who would notice or complain about a dollar here or there as a user tax? Except they would add up significantly as we have already seen, over time.

      Posted by: David R. Remer at October 14, 2007 06:24 AM
      Comment #236112
      Brian Pearson wrote: Aside from disagreeing slightly to your figures. For example — 1) First person makes 18k and spends 10k is taxed on 2k which would be .3*2000=600
      Not true. Your math is severely flawed. Math is not your strong suit is it?

      The 30% sales tax on $10K is $3000. Not $600 .
      Where the $2000 comes from is a true mystery.
      The first $8K of $18K gross is essentially not taxed due to the prebate.

      Brian Pearson wrote: 2) Second person makes 28k and spends 19k and is taxed on 11k which would be .3*11000=3300…
      Wrong again.

      Where the $3000 comes from is another mystery.
      The 2nd person grosses $28K.
      The first $8K is essentially not taxed due to the prebate.
      The $19K spent above the first $8K is taxed at 30%, which is $5.7K
      Not $3000.

      Brian Pearson wrote: Keep in mind that with all so-called hidden costs gone, prices will come down, which is why the taxes will balance out to zero. Nice, huh?
      Nonsense. These mystery hidden costs are just one of many of the weaknesses of the FairTax.org’s 30% National Sales tax system.

      Brian Pearson. Your math was all messed up.
      Your math is full of holes.

      Care to try again?

      Posted by: d.a.n at October 14, 2007 11:52 PM
      Comment #236193

      Yeah, I admit that the figures were wrong. I must’ve been half asleep that night, LOL!

      But you are going to have to convince me that the fairtax’s alleged weakness is that they say prices levels will come down after hidden taxes disappear. In one of your earlier notes, I think you suggested that companies will surely keep prices where they are and instead pay dividends to stockholders. To that, I gave a true-life example of how one time the airlines got a break in fuel costs by about 15%, one airline went down by that amount in fares and the rest followed suit. The market will follow the path of least resistance, because that is the way they grab (or try to keep) customers.

      Posted by: Brian Pearson at October 15, 2007 11:47 PM
      Comment #236199

      Brain Pearson,

      OK, first of all, I think we both agree the current tax system is a mess. Even though it was supposed to be PROGRESSIVE, with all the abuses and tax loopholes, it is effectively REGRESSIVE. And it is costly due to bookkeeping requirements.

      The 17% Income Tax system I’d propose would eliminate all tax loopholes and deductions except one. The standard poverty-level deduction that everyone would get (e.g. $8K). That is equivalent to the $2400 prebate (i.e. 30% of $8K is $2400). Rather than a prebate, the first $8K would simply not be taxed (for anyone). The current tax system has a $3300 standard deduction. The poverty-level deduction would be far simpler and less expensive than mailing out prebates each year. Also, who would receive a prebate? People that do not even work? The 17% Income Tax system simply does not tax the first $8K, and the tax calcation is so simple, a 1st grader could do it. All of the complex taxes would be history.

      Now, about prices and hidden taxes.
      The 17% Income tax system would eliminate ALL corporate income taxes, because those are like hidden sales taxes passed onto consumers. They also make is more difficult for corporations to compete globally. Thus, there are no hidden taxes. Only a NEUTRAL (flat) 17% income tax on income above the poverty level.

      Now, with the 30% National Sales tax, there would no longer be income taxes, or Medicare taxes, or Social Security taxes. The 30% Sales tax would replace all of that. The $2400 prebate essentially makes the first $8K of mone spent tax free (since $2400 is 30% of $8K).

      However, here’s the rub with the 30% National Sales tax. Since there are no more income taxes, Social Security, or Medicare withholding from income, guess what? Salaries must be reduced. That is, the money has to come from somewhere. The corporation would no longer be sending withholding taxes to the IRS. Therefore, incomes would be reduced. Now, you might say that the corporation would let the employees keep the money that was being sent to the IRS. However, the corporation (like everyone else) will also be subject to sales taxes (on the final products that the corporation purchases; not business-to-business items or used items). So the money has to come from somewhere. People would need to understand this; that their salaries will be reduced. Therefore, a shift has occurred. We’re simply looking at the same problem from the different end of the spectrum (sales taxes versus income taxes).

      With the 17% Income tax, there would be no corporate income taxes. Therefore, there are no hidden taxes.

      The FairTax.org plan states that the prebate makes the effective rate progressive. That is false and can easily be proven. The prebate of $2400 only affects the fisrt $8K. Above that, it is REGRESSIVE like all sales taxes are. In the example above, I showed the effective tax rates on the gross and on the income above the first untaxed $8K. As you can see, a 30% sales tax can be extremely REGRESSIVE. The only way any flat sales tax can not be REGRESSIVE is if everyone spends all of their income. This is a mathematical certainty. And even then, the best it could hope for is to be NEUTRAL. It is impossible for it to be PROGRESSIVE. The only progressive region of the graph is at the very lowest income level. But that is true for all of the tax systems due to the standard deduction, poverty-level deduction, or prebate.

      So, the FairTax.org’s statement:

      A rebate makes the effective rate progressive.
      … is false.

      Again, look at this example where the first $8K is not taxed (whether due to prebate, poverty level deduction, or standard deduction).

      The root of the problem with any sales tax is that above the untaxed amount (i.e. the first $8K), it is REGRESSIVE. It can never be PROGRESSIVE. It can only be NEUTRAL if everyone spends ALL of their income. And that is not as likely for the wealthy as it is almost a certainty for the less wealthy.

      Posted by: d.a.n at October 16, 2007 12:50 AM
      Comment #236201

      CORRECTION: exmaple

      Posted by: d.a.n at October 16, 2007 12:56 AM
      Comment #236274

      I don’t see a problem with wages coming down. That way, companies can charge even less.

      Brian

      Posted by: Brian Pearson at October 16, 2007 10:37 PM
      Comment #236311

      Brian,
      The point is (1)hidden taxes, and (2)whether the 30% sales tax is REGRESSIVE.

      (1) With corporate income taxes eliminated in the 17% income tax system, there are no hidden taxes.

      (2) Did you see the charts?
      All sales taxes are REGRESSIVE (after the $2400 prebate runs out which only untaxes the first $8K), unless everyone spends ALL of their income. That’s not likely for the wealthy, but increasingly likely as income decreases.
      Instead of a PROGRESSSIVE or REGRESSIVE system, wouldn’t you think a NEUTRAL (flat) income tax rate is more fair?

      After the first $8K of income, all income spent above that is taxed 30%.
      The less wealthy (e.g. $38K) will have to spend most of their income on food, shelter, transportation, and medical/insurance.
      The wealthier (e.g. $100K or above) will spend less of their income to merely get by. Especially with no income tax on interest or capitcal gains. Thus, after the $2400 prebate is gone, as income decreases, taxes as a percentage of income increases.

      ____REGRESSIVENESS of 30% SALES TAX:____
      30% []
      27% .[]
      24% . . []
      21% … []
      18% … . . []
      15% . . X… .[]
      12% XX[]
      09% … … . X[]
      06% … … … . .X[]
      03% … … … … … .X. .[]
      00% … … … … … … … . X[]
      $18K 36K 54K 72K 90K 108K 126K 144K $162K

      NOTE1: See how the tax rate relative to income increases as income decreases?
      That’s a regressive tax (i.e. the lower income groups essentially pay a higher tax rate relative to income).
      The only place where the tax rate is progressive (on gross income) is only up to the 1st $8K of income. After that, it is regressive on the gross too.
      No flat sales tax can ever be anything but regressive unless everyone spends ALL of their income (which is increasingly unlikely as income increases and increasingly likely as income decreases).
      And with such a small prebate (e.g. $2400 which essentially equals the tax on the first $8K of income), it is a regressive tax on all income above the puny first $8K.

      Where:
      [] = income tax above 1st $8K (i.e. untaxed due to $2400 prebate)
      X = income tax on gross

      _____FLAT 17% INCOME TAX:____
      17% [] . [] . [] . [] . [] . [] . [] . [] . [] . X[]
      16% … … … … … … . .X
      14% … … … … … .X
      12% … … … … X
      10% … … … X
      08% … … . X
      06% … . .X
      04% …X
      02% . X
      00% X
      $18K 36K 54K 72K 90K 108K 126K 144K $162K

      NOTE2: See how the tax rate relative to income never exceeds 17%?
      On income above the poverty-level (e.g. the first untaxed $8K), it’s flat (NEUTRAL).
      The poverty-level deduction (i.e. no tax on the first $8K of income) makes the tax progressive for the lower income groups, but approaches the 17% limit as income increases.
      All income above the poverty-level deduction (e.g. above the first untaxed $8K), it is taxed an equal 17% (see [] above).

      Posted by: d.a.n at October 17, 2007 12:14 PM
      Comment #237256

      “…sales taxes punishes the poor with out a low-income-exemption-level or rebate of some sort…”

      The nature of the fairTax is that there will be a rebate, just as your flat tax has. The main difference between the two is that the FairTax doesn’t taxes all income, including investment, inheritance, gifts, payroll, wages, prizes, lotteries, and etc. This is a disincentive to invest. First income is taxed, then income gains from investment is taxed, (or all money that exchanges ownership, with the exception of Social Security and Medicare.) If you want to grow the economy, the best way to do it is the FairTax. If people choose to spend, then they are taxed. If not, then they are saving. Saving is investment of a sort. And, if parents save money they can give (as a gift or inheritance) it to their kids without penalty.

      OK, so you are arguing that the Fairtax is regressive and your flat tax is neutral, unless everyone under the FairTax spends all of their income. This is a false comparison because there are certain assumptions being made which are true only under certain circumstances. Some measurements don’t include wealth. Others are over specific periods of time. I’ve done some reading since we last met, and found that the FairTax can be somewhat progressive. I wouldn’t depend on that site you have cited to be completely accurate.

      You might take a look here, the second chart in the regressive/progressive debate section.

      Posted by: Brian Pearson at October 30, 2007 10:04 PM
      Comment #237294

      Brian said: “If you want to grow the economy, the best way to do it is the FairTax.”

      Simple statement, too simple to answer America’s needs. The UnFair Tax puts the tax burden on American consumers, curtailing their consumption. Now for American corporations doing business overseas, this is not a problem, as a loss in consumption through taxation of consumption here has no effect on their growing markets overseas. But, this also incentivizes corporations to move overseas, making the American consumer ever more dependent on foreign imports.

      Warren Buffet did a survey and found he is paying the lowest tax rate of all employees in his office and he has no accountants seeking tax shelters for his income. He says this is wrong. The UnFair tax would exacerbate this wrong hundreds fold, hastening the rate at which the vast wealth of this country is concentrated into the hands of a very small percentage of Americans, who will increasingly find better investment returns in foreign markets, bankrupting America.

      Also consider this. The UnFair Tax would bring our government to its knees in the event of a deep recession or depression since revenues from consumption would erode dramatically. Given, that we now have 9 trillion in national debt, do you really want the government depending on consumption for its operating capacity?

      The UnFair Tax is an outright grab by the wealthy to immunize their wealth from taxation - the net consequence of which will be the bankrupting of the government, which we know is viewed by many wealthy as their enemy. Wealth is no assurance of intelligence or education on economics. Especially inherited wealth.

      Posted by: David R. Remer at October 31, 2007 07:52 AM
      Comment #237338

      “The UnFair Tax puts the tax burden on American consumers, curtailing their consumption.” An income tax systems puts a tax on work, curtailing productivity. It also embeds itself into product prices, removing transparency. Perhaps Americans saving a little bit of money, instead of having a negative savings rate, isn’t a bad thing. “Now for American corporations doing business overseas, this is not a problem, as a loss in consumption through taxation of consumption here has no effect on their growing markets overseas.” The FairTax would have an effect at home and overseas as it would automatically be border adjustable, the 17% competitive advantage, on average, of foreign producers would be eliminated, immediately boosting U.S. competitiveness overseas and at home. Just about every economist that has analyzed the FairTax, even opponents, say that the FairTax will grow the economy. We have a letter signed by eighty economists, including Nobel Laureate Vernon L. Smith that state the FairTax would boost the United States economy. We’re going to drop 500 billion in compliance tax costs and bring back an estimated $12 trillion held in foreign accounts (largely for tax purposes), which former Federal Reserve Chairman Alan Greenspan predicts would be repatriated back to U.S. banks becoming available to U.S. capital markets, bringing down interest rates, and otherwise promoting economic growth in the United States. Research in 2006 on the FairTax plan by Arduin, Laffer & Moore Econometrics shows that consumption would increase by 2.4% in the first year of the FairTax. The increase in consumption would be fueled by the 1.7% increase in disposable (after-tax) personal income. By the 10th year, consumption would increase by 11.7% over the current tax system; and disposable income would be up by 11.8%. According to the National Bureau of Economic Research, GDP would increase almost 10.5% in the year after the FairTax goes into effect. Real investments could increase by as much as 76% initially and remain 15% above present levels. In addition, the incentive to work would increase by as much as 20%, the economy’s capital stock would increase by 42%, labor supply by 4%, output by 12%, and real wage rate by 8%. A study in 2007 by the Beacon Hill Institute of Suffolk University stated that within five years real GDP would increase 10.7% over the current system, domestic investment by 86.3%, capital stock by 9.3%, employment by 9.9%, real wages by 10.2%, and consumption by 1.8%. Laurence Kotlikoff of Boston University finds that the shift to the FairTax would raise marginal labor productivity and real wages over the course of the century by 18.9% and long-run output by 10.6%. Further, studies of the FairTax at Boston University and Rice University suggests the FairTax will bring long-term interest rates down by as much as one third. As falling tax compliance costs lower production costs, exports would increase by 26% initially and remain more than 13% above present levels. According to Professor Dale Jorgenson of Harvard University’s Economics Department, revenues to Social Security and Medicare would double as the size of the economy doubles within 15 years after passage of the FairTax.

      “But, this also incentivizes corporations to move overseas, making the American consumer ever more dependent on foreign imports.” The FairTax will drop the corporate tax rate to zero. America will be the largest corporate tax haven in the world. Bill Archer, former head of the House Ways and Means Committee, asked Princeton University econometricists to survey 500 European and Asian companies regarding the impact on their business decisions if the United States enacted the FairTax. Of these companies, 400 responded that they would build their next plant in the United States while the remaining 100 companies said they would move their corporate headquarters to the United States. American companies doing business internationally would be able to sell their goods at lower prices but at similar margins, and this would bring jobs to America. In addition, U.S. companies with investments or plants abroad would bring home overseas profits without the penalty of paying income taxes, thus resulting in more U.S. capital investment. “The UnFair tax would exacerbate this wrong hundreds fold, hastening the rate at which the vast wealth of this country is concentrated into the hands of a very small percentage of Americans, who will increasingly find better investment returns in foreign markets, bankrupting America.” Where is this data coming from? With the stream of capital in the U.S. markets, I don’t see how this makes any sense. America is the strongest economy and a major player in the world economy, if America went bankrupt, the entire world system would collapse. There is absolutely no evidence that anyone would move their investments into foreign markets - what purpose would this serve? “The UnFair Tax would bring our government to its knees in the event of a deep recession or depression since revenues from consumption would erode dramatically. Given, that we now have 9 trillion in national debt, do you really want the government depending on consumption for its operating capacity?” I think we addressed much of this above, but to the point of depending on consumption for operating capacity, when you compare the stability of the tax base of personal consumption expenditures against adjusted gross income, consumption has a more stable base then income.

      “The UnFair Tax is an outright grab by the wealthy to immunize their wealth from taxation - the net consequence of which will be the bankrupting of the government, which we know is viewed by many wealthy as their enemy. Wealth is no assurance of intelligence or education on economics. Especially inherited wealth.” Laurence Kotlikoff, economist at Boston University, states that the FairTax would be a tax on wealth, unlike the current system that taxes income and that the FairTax could make the tax system much more progressive and generationally equitable. “Their view that taxing sales is regressive is just plain wrong. Taxing consumption is effectively the same as taxing wages plus taxing wealth.” Kotlikoff continued, “But what about saving one’s wages and wealth and spending these funds plus accumulated interest in the future? Doesn’t this avoid the consumption tax? No. You end up paying consumption taxes not just on the original sums, but also on the accumulated interest.” The payroll tax system is regressive on income with no standard deduction or personal exemptions taxing only the first $97,500 from gross wages, and none earned from capital investments or interest. The Center on Budget and Policy Priorities states that three-fourths of taxpayers pay more in payroll taxes than they do in income taxes. Under the FairTax, it would be eliminated. The Beacon Hill Institute at Suffolk University concluded in a 2007 study that “replacing income and payroll taxes with the FairTax would make the United States federal tax system more progressive than it is now” and also stating that it “would benefit the average individual in almost all expenditures deciles.” Economists at Boston University found that the FairTax would reward low-income households with 26.3% more purchasing power, middle-income households with 12.4% more purchasing power, and high-income households with 5% more purchasing power.

      If you still fully disagree, I think we may be at an impasse, and will have to agree to disagree. :) It’s been very nice talking to you. Feel free to join a FairTax blog and express your thoughts pro and con.

      http://photos1.blogger.com/blogger/2810/832/320/tombstone%202006.0.jpg

      Posted by: Brian Pearson at October 31, 2007 07:15 PM
      Comment #237347

      OK, let’s debunk this FairTax 30% Sales tax fraud once and for all.
      Let’s use the data from the Wikipedia web-site about FairTax.org.
      After the prebate runs out, the FairTax.org’s 30% Sales tax is still a REGRESSIVE tax, and there is no way to undo that.
      That causes a very strange tax curve.
      The curve is progressive ONLY up to the point where the prebate runs out.
      After that, it is REGRESSIVE.
      Who does it benefit the most?
      You guessed it. The wealthy.
      It’s very clever, but it will not stand up to scrutiny.
      The following very clearly reveals the HOAX.
      Also, remember a fact: ALL Sales taxes are REGRESSIVE.
      Next, after the prebate runs out, it is nothing more than a sales tax, and all sales taxes are REGRESSIVE.

      See the table: FairTax progressive rate structure for Married couple: Two children
      I added the income column at the far left and the TAPOGI column on the far right.

      Married with 2 children
      Poverty Level = $25,660
      Prebate = $5902
      POPL = Percent of Poverty Level
      TAPOGI = Tax As Percent Of Gross Income

      Income ___ POPL _ Spending _FairTax__ Rebate __NetTax___EffectiveRate__TAPOGI
      $8K ___ 25% __ $6,415 ___ $1,475 ___ $5,902 _ ($4,427) _ -69.0% _ 0%
      $15K __ 50% __ $12,830 __ $2,951 ___ $5,902 _ ($2,951) _ -23.0% _ 0%
      $30K __ 100% _ $25,660 __ $5,902 ___ $5,902 _ ($0.00) ____ 0.0% _ 0%
      $45K __ 150% _ $38,490 __ $8,853 ___ $5,902 _ $2,951 _____ 7.7% _ 22.64%
      $65K __ 200% _ $51,320 __ $11,804 __ $5,902 _ $5,902 ____ 11.5% _ 20.00%
      $100K _ 300% _ $76,980 __ $17,705 __ $5,902 _ $11,803 ___ 15.3% _ 18.82%
      $150K _ 400% _ $102,640 _ $23,607 __ $5,902 _ $17,705 ___ 17.2% _ 16.38%
      $1.03M _4000%_ $505,902 _$116,357 __ $5,902 _$110,455 ___ ??.?% _ 10.72%

      Notice (in the far right column) that the TAPOGI (Tax As Percent Of Gross Income) increases as income decreases after the prebate runs out.
      After the prebate runs out, it is a REGRESSIVE tax system.
      And how the EffectiveRate is calculculated without knowing the income column is a mystery.

      Now, let’s consider a single person with a $2400 prebate (from the FairTax.org’s own example on their own web-site).
      The $2400 prebate essentially untaxes the first $8K of spending.

        LEGEND:
          [] = income tax above 1st $8K (i.e. untaxed due to $2400 prebate or not taxing the first $8K)

          X = income tax on gross

      ____(REGRESSIVE) 30% SALES TAX:____
      30% []
      27% _[]
      24% _ _ []
      21% _ _ _ []
      18% _ _ _ _ _ []
      15% _ _ X_ _ _ _[]
      12% X _ _ _ X_ _ _[]
      09% _ _ _ _ _ _ _ X_ _ _[]
      06% _ _ _ _ _ _ _ _ _ _ _X_ _ _[]
      03% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X_ _[]
      00% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ X[]
      $18K 36K 54K 72K 90K 108K 126K 144K 162K 180K $198K

      NOTE1: See how the FairTax.org’s tax rate relative to income increases as income decreases?
      That’s a REGRESSIVE tax (i.e. the lower income groups essentially pay a higher tax rate relative to income).
      The only place where the tax rate is progressive (on gross income) is only up to the 1st $8K of income. After that, it is regressive on the gross too.
      No flat sales tax can ever be anything but regressive unless everyone spends ALL of their income (which is increasingly unlikely as income increases and increasingly likely as income decreases).
      And with such a small prebate (e.g. $2400 which essentially equals the tax on the first $8K of income), it is a regressive tax on all income above the puny first $8K.
      And notice the funny bump?
      What’s that about?
      What that is, is a tax that is REGRESSIVE again after the prebate runs out.
      This FairTax.org tax system is a very clever fraud. Don’t fall for it.

        Where:
          [] = income tax above 1st $8K (i.e. untaxed due to $2400 prebate or not taxing the first $8K)
          X = income tax on gross

      This is a better tax system. It simply does not tax income below the poverty level.
      There is no wierd and uneven graph lines as there is in the 30% Sales Tax system shown above.
      _____FLAT (NEUTRAL) 17% INCOME TAX:____
      17% [] _ [] _ [] _ [] _ [] _ [] _ [] _ [] _ [] _ [] _ [] _ X[]
      16% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X
      14% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X
      12% _ _ _ _ _ _ _ _ _ _ _ _ X
      10% _ _ _ _ _ _ _ _ _ X
      08% _ _ _ _ _ _ _ X
      06% _ _ _ _ _X
      04% _ _ _X
      02% _ X
      00% X
      $18K 36K 54K 72K 90K 108K 126K 144K 162K 180K $198K

      NOTE2: See how the tax rate relative to income never exceeds 17%?
      On income above the poverty-level (e.g. above the first untaxed $8K), it’s flat (NEUTRAL).
      The poverty-level deduction (i.e. no tax on the first $8K of income) makes the tax lower income groups progressive, but approaches the 17% limit as income increases.
      All income above the poverty-level deduction (e.g. above the first untaxed $8K), it is taxed an equal 17% (see [] above).
      Also, note that there are no funny bumps. No deceptive math. It’s a smooth curve that gradually approaches at maximum tax rate of 17%, and never more.

      • FACT # 1: a flat sales tax can never be a PROGRESSIVE TAX. That is a mathematical certainty.
      • FACT # 2: a flat sales tax can never be anything but a REGRESSIVE TAX unless everyone spends all of their income.
      • FACT # 3: a flat sales tax is always a REGRESSIVE TAX unless everyone spends all of their income.
      • FACT # 4: a flat sales tax can ONLY be a NEUTRAL TAX (at best) if everyone spends ALL of their income.
      • FACT # 5: since everyone doesn’t spend all of their income, all flat sales taxes are always a REGRESSIVE tax.
      • FACT # 6: after the prebate runs out, the FairTax.org’s 30% Sales tax is REGRESSIVE thereafter.
    • ____DEFINITIONS1:_____
      • REGRESSIVE TAX: income tax increases as income decreases;
      • PROGRESSIVE TAX: income tax increases as income increases;
      • NEUTRAL TAX: income tax is constant regardless of income;

      Here is a better tax system that starts out progressive, and approaches a neutral 17%.

    • Posted by: d.a.n at October 31, 2007 11:12 PM
      Comment #237428

      Well, this is old ground — stuff that has already been debunked. I invite you to check out these blogs and forums.

      Brian

      Posted by: Brian Pearson at November 1, 2007 10:54 PM
      Comment #237529
      Brian Pearson wrote: Well, thiss is old ground — stuff that has already been debunked. I invite you to check out these blogs and forums.
      Old ground?

      Just the truth.
      If the FairTax.org’s 30% Sales Tax is not REGRESSIVE after the prebate runs out, simply prove it.
      The prebate ($2400 for a single person, $5902 for a family of 4) only untaxes the lowest income levels. That’s all.
      It’s not that complicated. Just explain why the math (below) is wrong.
      We don’t need more links to blogs and forums.
      All we need is on the FairTax.org’s 30% Sales Tax web-site.
      The numbers below are THEIR numbers.
      Why not try to debunk the math instead?
      After all, I used the data from FairTax.org’s 30% Sale Tax own web-site?
      I simply added the column on the right and the column on the left; the two columns that they conveniently omitted.

      Brian Pearson, Have you really done the math, or are you merely taking someone else’s word for it?
      It’s not that complicated.
      Do you know why the FairTax.org’s 30% Sales Tax has that strange curve (see below)?
      Because it is a REGRESSIVE tax after the prebate runs out ($2400 for a singe person, $5902 for a family of 4).
      Do you know why the FairTax.org’s 30% Sales tax chart omitted the income column (far left) and TAPOGI column (far right) which I added below?:

        Married with 2 children
        Poverty Level = $25,660
        Prebate = $5902
        POPL = Percent of Poverty Level
        TAPOGI = Tax As Percent Of Gross Income

      Income _ POPL _ Spending _FairTax__ Rebate _NetTax__EffectiveRate__TAPOGI
      $8K ___ 25% __ $6,415 ___ $1,475 ___ $5,902 _ ($4,427) _ -69.0% ___ 0%
      $15K __ 50% __ $12,830 __ $2,951 ___ $5,902 _ ($2,951) _ -23.0% ___ 0%
      $30K __ 100% _ $25,660 __ $5,902 ___ $5,902 _ ($0.00) ____ 0.0% ___ 0%
      $45K __ 150% _ $38,490 __ $8,853 ___ $5,902 _ $2,951 _____ 7.7% ___ 22.64%
      $60K __ 200% _ $51,320 __ $11,804 __ $5,902 _ $5,902 ____ 11.5% ___ 21.82%
      $90K __ 300% _ $76,980 __ $17,705 __ $5,902 _ $11,803 ___ 15.3% ___ 21.05%
      $150K _ 400% _ $102,640 _ $23,607 __ $5,902 _ $17,705 ___ 17.2% ___ 16.38%
      $1.03M_4000%_ $505,902 _$116,357 __ $5,902 _$110,455 ___ ??.?% ___ 10.72%

      Because they do NOT want people to understand that tax as a percentage of income is REGRESSIVE.
      So, when someone can explain away that strange curve (see below), and how when the prebate runs out, the FairTax.org’s 30% Sales tax is REGRESSIVE again, then you might have an arguement.
      But that ain’t gonna happen, because it is a mathematical impossibility.

      And the truth is:

      • the FairTax.org’s 30% Sales Tax is a REGRESSIVE tax.

      • After the prebate runs out, it is a REGRESSIVE tax.

      • That’s a fact that can not be disproved. The numbers and graphs above prove it.

      • All sales taxes are REGRESSIVE, and the prebate only shelters the income at the lowest level. After the prebate runs out, it is a REGRESSIVE tax.

      • All sales taxes are REGRESSIVE unless everyone spends all of their income.

      For those that do not entirely understand the math, here is the most simple thing to understand:
      • people that spend a larger percentage of their income on necessities will pay a larger percentage of their income to sales taxes.

      • The prebate ($2400 for a single person, or $5902 for a family of 4) only untaxes the first $8K to $19.7K (respectively).

      • Under the FairTax.org’s 30% Sales Tax, the rich have much MORE disposable income to invest, and all of those investments would be tax free since the income tax would be eliminated.

      • After the prebate runs out, it is a flat sales tax. All sales taxes are REGRESSIVE.

      • Ask yourself this question: Why will the rich love this FairTax.org’s 30% Sales Tax ?

      • After the first $8K (for a single person) to $19.7K (for a family of 4), every dollar spent is taxed at a whopping 30% ! That’s why the FairTax.org’s 30% Sales Tax has that strange bump (see X line below). That’s why the graph suddenly starts to decrease again after that bump; because the tax rate relative to income starts decreasing as income increases. That is a REGRESSIVE tax.
      ___________LEGEND:____________
      • [] = income tax above 1st $8K (i.e. untaxed due to $2400 prebate or not taxing the first $8K)

      • X = income tax on gross
      ____(REGRESSIVE) 30% SALES TAX:____
      30% []
      27% _[]
      24% _ _ []
      21% _ _ _ []
      18% _ _ _ _ _ []
      15% _ _X_X _ _ _[]
      12% _X _ _ _ X_ _ _ _[]
      09% _ _ _ _ _ _ _ X_ _ _ _[]
      06% _ _ _ _ _ _ _ _ _ _ _X_ _ _ _ []
      03% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X_ _ _ _ _[]
      00% X_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ X[]
      _$10K $18K 36K 54K 72K 90K 108K 126K 144K 162K 180K $198K

      So, here’s the challenge for any FairTax.org 30% Sales Tax supporter:

        After the prebate ($2400 for a single preson, $5902 for a family of four) runs out, how is a 30% Sales Tax NOT REGRESSIVE ? ?

      Good luck trying to prove it, because it is a mathematical impossibility.
      The prebate would have to be HUGE to not be REGRESSIVE.
      Wherever the prebate runs out, the tax is REGRESSIVE.
      That is the clever fraud of the FairTax.org’s 30% Sale Tax system.
      The ONLY place it is a PROGRESSIVE tax is at the very bottom of the income scale.
      Ask yourself: Who will love this tax system the most, and why?

      Here is a better 17% Tax System, with no taxes on the income below the poverty level.
      See the PROs/CONs of each.

      Posted by: d.a.n at November 3, 2007 08:20 AM
      Comment #237535

      Brian Pearson, Thanks for the hyper-links. I posted links to the PROs/CONs.
      People should understand that after the prebate ($2400 for a single person, $5902 for a family of 4) runs out, the FairTax.org’s 30% Sales Tax is a REGRESSIVE tax, because ALL sales taxes are REGRESSIVE.

      Posted by: d.a.n at November 3, 2007 11:25 AM
      Comment #237612

      It is not helpful to continue to have Social Security and Medicare taken out as well as to tax income from investment. That’s double taxation, insofar as I’m concerned, and the FairTax does away with that.

      I’m not concerned about how much rich pay or do not pay. I’m concerned about growing the economy.

      BTW, I noticed that all of your links are to the same site. Who supports it? And, what system currently has the most support? And why is that?

      You argue that the FairTax is a sales tax and must be regressive, because all sales taxes are regressive. But the FairTax is not under the umbrella of “all sales taxes,” because all other sales taxes do not provide a prebate.

      If you take an average family of four, spending $25,660, the effective tax rate is zero. Keep in mind that the poorer a family is, the more they will tend to visit thrift shops and buy used items. No used items are taxed — and that includes used houses, cars, anything used.

      Another concern of yours is how much the rich pay. It is not my concern because it is a good thing for the little guy. The FairTax has a much broader tax base, it provides a haven for manufacturers who would rather stay here than to move to some other country. That means more jobs. More jobs means more revenue for the government. And, since people are saving more, this is a good thing. Not enough people are saving, now.

      I can’t say enough good things about it.

      Posted by: Brian Pearson at November 4, 2007 11:18 PM
      Comment #237629
      Brian Pearson wrote: It is not helpful to continue to have Social Security and Medicare taken out as well as to tax income from investment. That’s double taxation, insofar as I’m concerned, and the FairTax does away with that.
      The FairTax.org’s 30% Sales Tax won’t do away with anything, but will instead be devastating to everyone but the poor and the wealthy.

      You do not want to tax investment income (e.g. interest income or capital gains)?
      But you want to tax income earned via hard labor?

      And if we’re going to continue Social Security and Medicare, the money has to come from somewhere.
      The FairTax is a 30% Sales tax with a prebate (about $2400 for a single person, and about $5900 for a family of 4).
      After the prebate runs out, it is a PURE sales tax.
      All sales taxes are REGRESSIVE.
      That is a mathematical certainty.
      The prebate only untaxes the first $8K for the single person getting a $2400 annual prebate, and $19.7K for the family of 4 getting a $5900 prebate.
      Those are hard facts that are constantly avoided.

      Brian Pearson wrote: I’m not concerned about how much rich pay or do not pay. I’m concerned about growing the economy.
      Growing the economy for who?

      The rich?
      That is what a REGRESSIVE tax system does.
      Besides, in 1980, 1% of the U.S. population owned 20% of all weatlh.
      Now, in 2007, 1% of the U.S. population owned 40% of all weatlh.
      The REGRESSIVE FairTax.org’s 30% Sales Tax will make the disparity trend worse.

      Brian Pearson wrote: BTW, I noticed that all of your links are to the same site. Who supports it?
      Those are my web-pages. Here’s one that is not my web-site that understands that the FairTax.org 30% Sales Tax is a REGRESSIVE tax and a fraud.
      Brian Pearson wrote: And, what system currently has the most support? And why is that?
      The current tax system (which is also REGRESSIVE and a mess) is obviously the most popular tax system since it is the one we have.

      The FairTax.org’s 30% Sales Tax system will not ever come about, because there are enough people that understand that it is a complete fraud.

      Brian Pearson wrote: You argue that the FairTax is a sales tax and must be regressive, because all sales taxes are regressive. But the FairTax is not under the umbrella of “all sales taxes,” because all other sales taxes do not provide a prebate.
      False.

      Can’t you read?
      The prebate only untaxes the first $8K for the single person getting a $2400 annual prebate, and $19.7K for the family of 4 getting a $5900 prebate.
      Sure, the single person making and spending $8K and receiving a $2400 prebate essentially pays ZERO tax.
      Sure, the family of 4 making and spending $19.7K and receiving a $5902 prebate essentially pays ZERO tax.
      That is NOT the issue.
      The issue is A_F_T_E_R the prebate runs out. After that, it is a PURE 30% sales tax.
      That is the reason for the funny bump in the FairTax.org’s 30% Sales Tax.
      All sales taxes are REGRESSIVE.
      REGRESSIVE TAX means as income increases, the tax relative to income DECREASES.
      That means, the middle class is going to pay a LARGER tax rate (relative to income) than the wealthy.
      That is a mathematical certainty.
      Why don’t you try to disprove that?

      Brian Pearson wrote: If you take an average family of four, spending $25,660, the effective tax rate is zero. Keep in mind that the poorer a family is, the more they will tend to visit thrift shops and buy used items. No used items are taxed — and that includes used houses, cars, anything used.
      So what?

      So the poor are not taxed?
      The current tax system doesn’t even tax the poor much (if at all, due to the standard deduction and earned income credits).
      The poor are also not taxed in the 17% Flat Income Tax System either (which simply does not income below the poverty level rather than engage in a complex prebate system, and the 17% Tax Plan also removes all tax loop holes, and does not tax corporations since those are merely like hidden sales taxes).
      You are focused on the poor.
      Forget the low income levels.

      Focus on the income levels ABOVE the poverty level.
      That is why, after the prebate runs out, the FairTax.org’s 30% Sales Tax becomes REGRESSIVE.
      It’s not complicated.
      It’s this simple.
      Excluding the poor exempted by the prebates or no tax on income below the poverty level, unless everyone spends ALL of their income, the FairTax.org’s 30% Sales Tax is REGRESSIVE, and that is a mathematical certainty that is impossible to explain away.
      That is what will doom the FairTax.org’s 30$ Sales Tax.
      People are quite capable of understanding that the wealthy will be paying a tiny percent of their income to taxes, while MOST people in the middle income group will be paying the HIGHEST rates as a percentage of income.
      That table above proves it.

      Brian Pearson wrote: Another concern of yours is how much the rich pay.
      Nonsense.

      Trying to mischaracterize my position only shows how weak your position really is.
      I am interested in truly fair taxation that is not REGRESSIVE (that is PROGRESSIVE at the low income levels and approaches a NEUTRAL 17%), does not tax corporations (since those are merely like more hidden taxes passed onto consumers), does not tax income below the poverty level, and eliminates all tax loop holes and deductions. The only income not taxed is income below the poverty level.

      Brian Pearson wrote: It is not my concern because it is a good thing for the little guy.
      Only the poor.

      But the low income to middle income levels will get screwed, because they will experience higher tax rates relative to income than the wealthy.
      How is that fair.
      Above the poverty level (essentially exempted due to the prebate), the ONLY way a flat sales tax can be NEUTRAL is if EVERYONE spends ALL of their income.
      Since that ain’t likely, all sales taxes are REGRESSIVE.

      Brian Pearson wrote: It is not my concern because it is a good thing for the little guy.
      Only the poor who essentially pay no tax.

      Only for the little guy who makes and spends less than $8K for a single person (due to $2400 prebate), or who makes and spends less than $19.7K for a family of 4 (due to the $5902 prebate).
      However, after that, MOST tax payers will get screwed.
      As you can see below, the TAPOGI (Tax As Percent Of Gross Income) increases as income decreases.
      Above the first $8K to $19.7K, the FairTax.org’s 30% Sales Tax is EXTREMELY REGRESSSIVE, as demonstrated with their OWN data from their OWN website:

        Married with 2 children
        Poverty Level = $25,660
        Prebate = $5902
        POPL = Percent of Poverty Level
        TAPOGI = Tax As Percent Of Gross Income

      Income _ POPL _ Spending _FairTax__ Rebate _NetTax__EffectiveRate__TAPOGI
      $45K __ 150% _ $38,490 __ $8,853 ___ $5,902 _ $2,951 _____ 7.7% ___ 22.64%
      $60K __ 200% _ $51,320 __ $11,804 __ $5,902 _ $5,902 ____ 11.5% ___ 21.82%
      $90K __ 300% _ $76,980 __ $17,705 __ $5,902 _ $11,803 ___ 15.3% ___ 21.05%
      $150K _ 400% _ $102,640 _ $23,607 __ $5,902 _ $17,705 ___ 17.2% ___ 16.38%
      $1.03M_4000%_ $505,902 _$116,357 __ $5,902 _$110,455 ___ ??.?% ___ 10.72%
      $9.00M_35000%_$2.00M ___$600,000 __ $5,902 _$600,000 ___ ??.?% ___ 6.67%

      Try to disprove that, instead of dancing around those facts.
      I’ve already proven beyond a shadow of a doubt that the FairTax.org’s 30% Sales Tax is REGRESSIVE after the prebate runs out, and the prebate only untaxes the first $8K for the single person getting a $2400 annual prebate, and $19.7K for the family of 4 getting a $5900 prebate.
      That is why there is a funny bump in the graph.
      The only progressive region of the graph is at the very bottom. After that, it is REGRESSIVE.

      Brian Pearson wrote: The FairTax has a much broader tax base,
      False. It is REGRESSIVE and after the puny prebates at the
      Brian Pearson wrote: it provides a haven for manufacturers who would rather stay here than to move to some other country. That means more jobs. More jobs means more revenue for the government.
      False.

      The ridiculoys FairTax.org’s 30% Sales Tax will devestate the economy and make the tax system more unfair and REGRESSIVE than ever before.
      That’s a fact and a mathematical certainty proven with the FairTax.org’s own data (see above).
      Why don’t you try to disprove that math above?
      You seem to think some puny prebates make the system fair.
      It does NOT.
      Those prebates are nothing more than a deduction for the poor.
      That’s all.
      After that, it is REGRESSIVE tax.
      The table above (using data from FairTax.org’s own website) proves it.

      Also, removing the corporate income tax is already a part of the 17% Income Tax System with the poverty level exemption.
      What is wrong with 17% on all income above the poverty level, no corporate income tax, and no tax deductions?
      There are lots of ways to make corporations more competitive globally without a ridiculous and unfair FairTax.org 30% Sales Tax.

      Brian Pearson wrote: And, since people are saving more, this is a good thing. Not enough people are saving, now.
      How are MOST people going to save more money when MOST people will be paying MOST of the taxes (especially as a percentage of their income)? ! ?
      Brian Pearson wrote: I can’t say enough good things about it.
      That can happen when people don’t really understand what they are talking about.

      The FairTax.org 30% Sales Tax is a fraud.
      That can be said with confidence, because it is the truth, and backed up mathematical certainty.
      The FairTax.org’s 30% Sales Tax is ONLY progressive at the bottom income level.
      After the prebate runs out, it is a REGRESSIVE tax system, which is why there is a funny bump in the FairTax.org’s tax scale graph.
      That funny looking graph is going to plague and finally doom the FairTax.org’s tax plan, because it reveals the fraud of the FairTax.org’s 30% Sales Tax.
      The puny prebate only untaxes the first $8K of income spent (for the single person getting a $2400 prebate) to $19.7K of income spent (for the family of 4 getting a $5900 prebate).
      The median income it $47K.
      The prebates would have to HUGE to ensure that MOST people do not pay a larger percentage of income to taxes than the very wealthy.

      There is NOTHING fair about the FairTax.org’s 30% Sales Tax, except for the lowest income levels only.
      That’s why the FairTax.org’s 30% Sale Tax system should really be named the FairTaxFraud 30% Sales Tax system.

      Posted by: d.a.n at November 5, 2007 11:18 AM
      Comment #237656

      You are trying to force it into an income tax mold when it is purely a consumption tax, and you are ignoring purchasing where used items are tax free. You’d have to somehow work that into your formula, if you can find reliable estimates for what is bought used. Also, there is no social security tax paid and Medicare tax paid, either by the employee or employer in the FairTax which, in effect, is a drag on the economy. The consumer has more effective take home pay this way, and he can invest more. On top of that, he is not taxed on income from investment, which would otherwise be double taxation.

      Posted by: Brian Pearson at November 5, 2007 08:20 PM
      Comment #237689
      Brian Pearson wrote: You are trying to force it into an income tax mold when it is purely a consumption tax, …
      AAhhhhh … now, we finally have a confession, eh?

      It isn’t supposed to be fair, eh? Duh!
      Well, why didn’t you just say that in the beginning?
      As I already knew all along, the Un-FairTax.org’s 30% Sales Tax/Prebate Plan it is N_O_T supposed to be a FAIR tax system at all.
      So, why do they call it the FairTax, when it is really the Most_UN-FairTax ever invented?

      Brian Pearson wrote: … and you are ignoring purchasing where used items are tax free. You’d have to somehow work that into your formula, if you can find reliable estimates for what is bought used.
      Funny!

      So now it is all about U_S_E_D goods that are tax free that will save the day?
      Untaxed used goods alone still can not explain away the REGRESSIVE nature of the Un-FairTax.org’s 30% Sales Tax.

      Brian Pearson wrote: Also, there is no Social Security tax paid and Medicare tax paid, either by the employee or employer in the FairTax which, in effect, is a drag on the economy.
      False.

      The Social Security and Medicare taxes come from the FairTax.org’s 30% Sales Tax, as explained in the FairTax.org’s own F.A.Q., which clearly states:

      • FROM FairTax.org: How is the Social Security system affected? Like all federal spending programs, Social Security operates exactly as it does today, except that its funds come from a broad, progressive [30%] sales tax, … The FairTax is replacement, not reform. It replaces federal income taxes including personal, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes.

      Brian Pearson wrote: The consumer has more effective take home pay this way, and he can invest more.
      Not for consumers that do not have any income left, which will be a L_A_R_G_E_R number of people under the Un-FairTax.org’s 30% Sales Tax, because after the puny rebate runs out, the REGRESSIVE Un-FairTax.org’s 30% Sales Tax will hammer the less wealthy, create black markets, and make the wealthiest more wealthy on the backs of the less wealthy.

      The O_N_L_Y persons that will have more to invest is the increasingly wealthy, due to the REGRESSIVE nature of the Un-FairTax.org’s 30% Sales Tax.
      For example:

        Married with 2 children
        Prebate = $5902
        TAPOGI = Tax As Percent Of Gross Income

      Income _ Spending _FairTax__Prebate _NetTax____TAPOGI
      $20K ___ $20K ___ $6,000 __ $5,902 _ $98.0 ____ 0.49%
      $30K ___ $28K ___ $8,400 __ $5,902 _ $2,498 ___ 8.33%
      $45K ___ $41K ___ $12.3K __ $5,902 _ $6,398 __ 14.22%
      $60K ___ $53K ___ $15.9K __ $5,902 _ $9,998 __ 16.67%
      $90K ___ $65K ___ $19.5K __ $5,902 _ $13,598 _ 15.11%
      $150K __ $90K ___ $27.0K __ $5,902 _ $21,098 _ 14.07%
      $1.00M _ $350K __ $105K ___ $5,902 __ $99.1K __ 9.91%
      $9.00M _ $2.50M _ $750K ___ $5,902 _ $744.1K __ 8.27%
      $100M __ $17.0M _ $5.10M __ $5,902 _ $5.094M __ 5.09%

      Brian Pearson wrote: On top of that, he is not taxed on income from investment, which would otherwise be double taxation.
      There is NO doubt about that most of the wealthiest will absolutely love the Un-FairTax.org’s 30% Sales Tax system (see above).

      Interest income and capital gains income doesn’t meam much to the less wealthy who have little to invest and would be paying a larger (TAPOGI) Tax As a Percent Of Gross Income (see table above and graphed below).

        ___________LEGEND:____________
      • [] = income tax above prebate (i.e. untaxed due to $5902 prebate; essentially untaxing the first $19,673 spent)

      • X = income tax on gross income
      ____( REGRESSIVE ) 30% SALES TAX:____

      30% []
      27% _ []
      24% _ _ _[]
      21% _ _ _ _ _ []
      18% _ _X_ X_ _ _ _[]
      15% _ _ _ _ _ _ _X _ _ _[]
      12% _ _ _ _ _ _ _ _ _ _ _ _ _ X _ _[]
      09% _X _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X _ _[]
      06% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X _[]
      03% _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X_[]
      00% X_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _X[]
      __$0K $50K 100K 150K 200K 300K $1.00M $100M $200M $300M $400M $500M $1B $5B $10B …
      Notice how the tax rate decreases as income increases? That is REGRESSIVE.

      Brian Pearson, Not a signle one of your arguments can explain away the unpleasant facts of the Un-FairTax.org’s REGRESSIVE 30% Sales Tax:

      • It is easy to understand why the wealthiest will love that tax curve above.

      • AFTER the puny prebate ($2400 for a single person, $5902 for a family of 4) is gone, the Un-FairTax.org’s 30% Sales Tax is a REGRESSIVE 30% Sales tax.

      • AFTER the puny prebate runs out, all money spent is taxed at 30%. That is, an item priced at $100 will cost a total of $130 with the 30% sales tax. The talk about a 23% tax is deceptive.

      • AFTER the prebate is gone, like ALL sales taxes, the Un-FairTax.org’s 30% Sales Tax is REGRESSIVE.

      • The prebate ONLY makes the Un-FairTax.org’s 30% Sale Tax progressive at the very lowest income level; after that, it is REGRESSIVE. As you can see in the table above, after the PREBATE runs out, the TAPOGI increases up to the middle-income level, and then as income increases above the middle-income level, the tax begins to decrease. This is why many wealthy people are throwing large sums of money at FairTax.org to push for the BILLs HR-25 & S-1025. Also, take a close look (below) at who is FOR this Un-FairTax.org’s 30% Sales Tax: 86 of the 91 are Republicans (no surprise there).

      • No other issues used to cloud the issues can change the REGRESSIVE nature of the Un-FairTax.org’s 30% Sales Tax.

      • A 30% Sales Tax will guarantee black markets.

      • Yes, with a whopping 30% Sales Tax on new items, there will be a HUGE market for used items (or, supposedly used, eh?).

      • All sales taxes are REGRESSIVE, unless everyone spends ALL of their income.

      • The FairTax.org’s web-site claims to be progressive, but that is a lie, since it is only progressive at the lowest income level. After the prebate runs out, it can NEVER be progressive. The best it could ever mathematically be is NEUTRAL and that is ONLY if everyone spends ALL of their income. Thus, the progressive claim is a fraud.

      • Taxing from the spending side is a very clever way to over-complicate the tax system so that the wealthiest can pay less tax.
      And that is why this Un-FairTax.org’s 30% Sales Tax will never become reality.

      Only 17% of the 535 Congress persons in the House and Senate, the following 91 Congeress persons (86 Republicans and 5 Democrats) support the Un-FairTax.org’s 30% Sales Tax/Prebate system:
      Rep. Don Young AK At Large R For - Cosponsor
      Rep. Spencer Bachus AL 6 R For - Cosponsor
      Rep. Jo Bonner AL 1 R For - Cosponsor
      Rep. John Boozman AR 3 R For - Cosponsor
      Rep. Jeff Flake AZ 6 R For - Cosponsor
      Rep. Trent Franks AZ 2 R For - Cosponsor
      Rep. John Shadegg AZ 3 R For
      Rep. Brian Bilbray CA 50 R For - Cosponsor
      Rep. John Doolittle CA 4 R For
      Rep. Duncan Hunter CA 52 R For - Cosponsor
      Rep. Darrell Issa CA 49 R For - Cosponsor
      Rep. Jerry Lewis CA 41 R For - Cosponsor
      Rep. Gary Miller CA 42 R For - Cosponsor
      Rep. Doug Lamborn CO 5 R For - Cosponsor
      Rep. Thomas Tancredo CO 6 R For - Cosponsor
      Rep. Gus Bilirakis FL 9 R For - Cosponsor
      Rep. Virginia Brown-Waite FL 5 R For - Cosponsor
      Rep. Ander Crenshaw FL 4 R For - Cosponsor
      Rep. Tom Feeney FL 24 R For - Cosponsor
      Rep. Ric Keller FL 8 R For - Cosponsor
      Rep. John Mica FL 7 R For - Cosponsor
      Rep. Jeff Miller FL 1 R For - Cosponsor
      Rep. Cliff Stearns FL 6 R For - Cosponsor
      Rep. Dave Weldon FL 15 R For - Cosponsor
      Rep. Paul C. Broun GA 10 R For
      Rep. Nathan Deal GA 9 R For - Cosponsor
      Rep. Phil Gingrey GA 11 R For - Cosponsor
      Rep. Jack Kingston GA 1 R For - Cosponsor
      Rep. John Linder GA 7 R For - Sponsor
      Rep. Tom Price GA 6 R For - Cosponsor
      Rep. David Scott GA 13 D For
      Rep. Lynn Westmoreland GA 3 R For - Cosponsor
      Rep. Steve King IA 5 R For - Cosponsor
      Rep. Dennis Hastert IL 14 R For - Cosponsor
      Rep. Dan Burton IN 5 R For - Cosponsor
      Rep. Mike Pence IN 6 R For - Cosponsor
      Rep. Jerry Moran KS 1 R For - Cosponsor
      Rep. Todd Tiahrt KS 4 R For - Cosponsor
      Rep. Geoff Davis KY 4 R For
      Rep. Ed Whitfield KY 1 R For - Cosponsor
      Rep. Rodney Alexander LA 5 D For - Cosponsor
      Rep. Richard Baker LA 6 R For - Cosponsor
      Rep. Charles Boustany, Jr. LA 7 R For
      Rep. Roscoe Bartlett MD 6 R For - Cosponsor
      Rep. Wayne Gilchrest MD 1 R For - Cosponsor
      Rep. Pete Hoekstra MI 2 R For - Cosponsor
      Rep. Candice Miller MI 10 R For
      Rep. Timothy Walberg MI 7 R For - Cosponsor
      Rep. Collin Peterson MN 7 D For
      Rep. Timothy Walz MN 1 D For
      Rep. Todd Akin MO 2 R For - Cosponsor
      Rep. Sam Graves MO 6 R For
      Rep. Sue Myrick NC 9 R For - Cosponsor
      Rep. Steve Pearce NM 2 R For - Cosponsor
      Rep. Patrick Tiberi OH 12 R For
      Rep. Dan Boren OK 2 D For - Cosponsor
      Rep. Mary Fallin OK 5 R For - Cosponsor
      Rep. Frank Lucas OK 3 R For - Cosponsor
      Rep. John Sullivan OK 1 R For - Cosponsor
      Rep. Tim Murphy PA 18 R For
      Rep. Henry E. Brown, Jr. SC 1 R For - Cosponsor
      Rep. Joe Wilson SC 2 R For
      Rep. David Davis TN 1 R For - Cosponsor
      Rep. John Duncan TN 2 R For - Cosponsor
      Rep. Zach Wamp TN 3 R For - Cosponsor
      Rep. Kevin Brady TX 8 R For - Cosponsor
      Rep. John Carter TX 31 R For - Cosponsor
      Rep. Mike Conaway TX 11 R For - Cosponsor
      Rep. John Culberson TX 7 R For - Cosponsor
      Rep. Kay Granger TX 12 R For - Cosponsor
      Rep. Ralph Hall TX 4 R For - Cosponsor
      Rep. Jeb Hensarling TX 5 R For - Cosponsor
      Rep. Michael McCaul TX 10 R For - Cosponsor
      Rep. Randy Neugebauer TX 19 R For - Cosponsor
      Rep. Ted Poe TX 2 R For - Cosponsor
      Rep. Pete Sessions TX 32 R For
      Rep. Mac Thornberry TX 13 R For - Cosponsor
      Rep. Rob Bishop UT 1 R For - Cosponsor
      Rep. Jo Ann Davis - deceased VA 1 R
      Rep. Thelma Drake VA 2 R For - Cosponsor
      Rep. Virgil Goode VA 5 R For - Cosponsor
      Rep. Barbara Cubin WY 1 R For - Cosponsor
      Sen. John McCain AZ R For
      Sen. Saxby Chambliss GA R For - Sponsor
      Sen. Johnny Isakson GA R For - Cosponsor
      Sen. Richard Lugar IN R For
      Sen. David Vitter LA R For
      Sen. John Ensign NV R For
      Sen. Tom Coburn OK R For - Cosponsor
      Sen. James Inhofe OK R For - Cosponsor
      Sen. Jim DeMint SC R For
      Sen. John Cornyn TX R For - Cosponsor

      Check out the names above. These are the names of Congress persons that want to inflict upon you one of the most UNFAIR tax systems ever invented.
      Do you want a tax system that is REGRESSIVE? Perhaps, if you are very wealthy and don’t care if it is an unfair and REGRESSIVE tax system?
      If you take anything away from this discussion, it should be this:

      • After the puny prebate is gone, it is a simple, flat 30% SALES Tax.

      • After the puny prebate is gone (about $2400 for the single person, $5900 for family of 4), spending is taxed at 30% (including food, medical, prescriptions, etc.)

      • After the puny prebate is gone, ALL Sales taxes are REGRESSIVE, unless EVERYONE spends ALL of their income, in which case it is NEUTRAL; NOT progressive.

      • Ask those that support the Un-FairTax.org’s 30% Sales Tax/Prebate system to explain away these many serious issues. Then observe the many clever technigues to cloud the issues, obscure the facts, change the subject, and avoid your questions.

      • And then ask yourself, WHO will love this Un-FairTax.org 30% Sales Tax/Rebate System the most? And WHY?

      Posted by: d.a.n at November 6, 2007 11:41 AM
      Comment #239865

      Man let me say.Democrats sure don’t like ANYTHING that threatens their getting to the public feeding trough do they.This fair tax is great.But they are so afraid they will lose their strings into the working mans wallet that they even reject this chance for the working man to be free of the tyrany of the IRS

      Posted by: gary at December 2, 2007 09:34 PM
      Comment #239979
      Gary wrote: This fair tax is great.
      Think so?

      Have you really looked at it closely?
      It is a regressive 30% Sales tax.
      Add in state, county, and city taxes, and you’ll have a whopping 38.5% sales tax.
      Can you say: “Black Market” ?

      Why do you suppose it has to be so high?
      The reason is so that the middle-income groups will be taxed enough to raise $2.7 Trillion in revenues while the wealthy get off with paying much tax rates relative to income.

      Don’t be fooled.
      Look at it closely.
      The tax curve is essentially a hump (i.e. the top half of a circle).
      Sure, it doesn’t tax the poor, but none of the proposed tax systems tax the poor much.

      Also, the IRS can essentially be almost eliminated by merely simplifying the existing tax system. Get rid of all tax loop-holes and tax deductions, and the tax return becomes extremely simple.

      Gary wrote: But they are so afraid they will lose their strings into the working mans wallet that they even reject this chance for the working man to be free of the tyrany of the IRS.
      I’m not a Democrat. I used to be a Republican, but am now an independent.

      Here’s a MUCH better approach.
      It’s a simple 17% Income Tax system, no one pays tax on income below the poverty level (only income above the poverty level), there’s no corporate income taxes that merely get passed onto consumers as more hidden sales taxes, and it eliminates ALL tax loop-holes. The only exception is that Social Security and Medicare benefits are not taxed, since those are benefits resulting from taxes, and it makes no sense to tax benefits derived from taxes. This 17% Income tax will raise enough taxes, and be much fairer (progressive -to- neutral).

      Here’s part of the FairTax.org’s 30% Sales Tax fraud … (www.fairtax.org/PDF/WhatIsTheDifferenceBetweenTaxRates.pdf) Page 4 of FairTax.org’s 30% Sales Tax example). Notice that their table omits income. Why is that? That’s because they don’t want you looking at tax relative to income.

      POPL = Percent of Poverty Level ($25,660 for family of 4)
      Eff.Tax = Effective Tax

      POPL _ Spending __FairTax___Prebate _NetTax_____Eff.Tax
      25% ___ $6415 ____ $1,475 __ $5,902 _ ($4,427) _ -69.0%
      50% ___ $12,830 __ $2,951 __ $5,902 _ ($2,951) _ -23.0%
      100% __ $25,660 __ $5,902 __ $5,902 _______ $0 ___ 0.0%
      150% __ $38,490 __ $8,853 __ $5,902 ___ $2,951 ___ 7.7%
      200% __ $51,320 __ $11,804 _ $5,902 ___ $5,902 __ 11.5%
      300% __ $76,980 __ $17,705 _ $5,902 __ $11,903 __ 15.3%
      400% __ $102,640 _ $23,607 _ $5,902 __ $17,705 __ 17.2%

      Now, let’s add the Income and IncomeTaxRate columns (what the FairTax.org 30% Sales Tax proponents don’t want you to see)

      POPL _ Spending __FairTax___Prebate _NetTax_____Eff.Tax _ Income __IncomeTaxRate
      25% ___ $6415 ____ $1,475 __ $5,902 _ ($4,427) _ -69.0% _ $8,000 __ -49.7%
      50% ___ $12,830 __ $2,951 __ $5,902 _ ($2,951) _ -23.0% _ $15,000 _ -13.7%
      100% __ $25,660 __ $5,902 __ $5,902 _______ $0 ___ 0.0% _ $27,000 __ 6.65%
      150% __ $38,490 __ $8,853 __ $5,902 ___ $2,951 ___ 7.7% _ $40,000 _ 14.11%
      200% __ $51,320 __ $11,804 _ $5,902 ___ $5,902 __ 11.5% _ $53,000 _ 17.91%
      300% __ $76,980 __ $17,705 _ $5,902 __ $11,903 __ 15.3% _ $200,000 _ 8.60%
      400% __ $102,640 _ $23,607 _ $5,902 __ $17,705 __ 17.2% _ $500,000 _ 4.98%

      Look at the IncomeTaxRate column on the right. It is decreasing as income increases. The middle-income group will get hammered. If you’re rich, you might like that very much. If you’re in the middle-income group (as most people are), you will pay a higher income tax rate, since a larger percentage of income will be spent on necessities. Especially now that the wealthy (under the 30% Sales Tax system) would also no longer be taxed on inheritance, capital gains, interest income, and other investment income.

      WHO will love the 30% Sales Tax system?
      And WHY?

      Posted by: d.a.n at December 4, 2007 04:39 PM
      Comment #239980

      Compare these tax systems.
      Which do you prefer?

      Posted by: d.a.n at December 4, 2007 04:46 PM
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