Oh good heavens help us...

[kellinator]

The latest idea from Herr Shrub: Let's get rid of the income tax and replace it with a national sales tax.

This is the worst idea I've heard from the Idiot-in-Chief since... oh, who's counting?

I don't know a lot about economics, but I come from Tennessee, home of one of the highest sales taxes in the nation (including on food, and yes I do mean groceries). And sales taxes are definitely regressive.

Do the math. Say a person needs x amount of food to survive, taxed at 8%. For Bill Gates that tax is nothing; for the average middle-class American it's an 8% jump in the food bill. Talk about your cost of living increase...

I guess this is his way of saying he doesn't think he's put enough of the tax burden on the middle and lower class.

And if this post pisses you off, I don't give a fuck.

EDIT: Excellent article from resipsaloquitor:
http://money.cnn.com/2004/08/11/news/economy/election_tax/index.htm?cnn=yes

Comments

[polychromatic22.livejournal.com]

I sincerely do suggest you actually read the literature on the national sales tax, rather than simply jumping to conclusions. As you said, you aren't an economist, so perhaps you should look into it yourself rather than just taking a gut reaction and rolling with it.

A good place to start is here for questions answered about the idea. (most especially, check out the one entitled "progressivity of the FairTax" Here's another brief sketch of the bill as it has been proposed. (H.R. 25)

Some of the things I especially like about hr 25 as it stands:
the used goods clause. There is no tax on used goods. This includes homes, cars, appliances, clothes, so forth. Not only does this help those just barely cutting above the poverty line but it also greatly encourages recycling. I would expect a much larger market for second hand goods to be developed if it passed.
the monthly rebate check that gives you back the money that you would have to spend on necessities that month. Food and goods are taxed, but you are given a rebate based on how much up to the poverty line you spend necessarily. "Rich assholes" who choose to spend $50 on a steak dinner are going to have to pay for it.
those who aren't paying taxes now will be forced to. There are literally millions of unpaid taxes each year that are earned illegally. No taxes are paid on them either because they were earned criminally or because the employer is not complying with uncle sam. This puts those bucks into the tax system. If you make $500k a year as a drug dealer, you're now going to have to pay for your bling bling.

Finally I like it because it takes the taxes out of the politicians hands. I really want to take away the ability of politicians to obfuscate the issues with promises or more money to you if you simply vote for them. (one of the reasons I want the drug prohibitions repealed also, these are not issues, not true issues, these are ways of controlling us. you never have to tell us what you actually are going to do as a politician once you are elected as long as you tell us that you'll tax us less [or move the tax burden to a different group of people] or help fight this horrible drug war).

You can read the bill here.

Here's some opposition to the bill. Though I must say, many of his arguements are addressed in the supportive literature. His best arguements are mainly where he doubts it will be as simple as it sounds. Mostly his arguement come down to the idea that 23% is unlikely, that itwill have to be higher, which will cause evasion.
This isn't a horrible arguement if you

I really don't expect you to support it, though. As it stands, it is mainly sponsered by republicans, 51 or them. Only 3 democrats have lent their support.
I hate both parties fairly equally, so I'm fairly happy with whatever either one suggests that I think is actually a good idea.

Never mind the idea of deciding whether an idea is good or not on it's own merits, definitely decide it along partisan lines. Republicans do it, Democrats do it, why shouldn't everyone?

[polychromatic22.livejournal.com]

I don't know what I was going to say at the point where that sentence chopped off, sorry (this isn't a horrible arguement if you)

Possibly something along the lines of "if you read the arguement" or maybe "if you agree that 23% is impossible" or something like that.

Dunno. I was trying real hard to give you links for you to read about it and decide yourself rather than just giving my own arguements, so it's a bit disjointed cuz of the surfing and linking I was doing. Sorry.

here's the problem I'm having with all this

[not-hothead-yet.livejournal.com]

(I read some of the linkage you provided but there's an awful lot of it)

If we (as barely above-poverty level) are encouraged to spend less, we will. This drives down demand of certain products.
If corporations are let go of all taxation for production, they will have a surplus of money. WHat they do with that money is entirely up to them.
THey can;
1)reinvest it - exporting, expansion, diversification
2)pass the savings along to the consumer - lower prices, increase quality, increase production
3)raise worker wages or benefits
4) invest it corporate-wide (passing along extra dividends to the stock holders)
5)invest if privately (passing along bonuses or salary increases to top management and CEOs)

Which do YOU think they will do?
Well it's possible they will do some of several. I can see some price reduction due to drop in domestic sales (if sales tax goes up to 23-30% I'm going to have to save longer to get the non-necessities I desire and/or I get less of them) and I can see possible expansion due to increase in export sales (if people aren't buying as much here in USA, they'll try harder to make up the sales overseas) which would hopefully increase job opportunities.

What I can't see is all that suddenly freed up money somehow being given to ME - the consumer/wage worker.

And with no property taxes, who's going to pay for the schools?

Re: here's the problem I'm having with all this

[terminalwriter.livejournal.com]

And with no property taxes, who's going to pay for the schools?

Property taxes are usually a State/Local thing. This is dealing with the Federal level, so they will probably still be around.

Re: here's the problem I'm having with all this

[polychromatic22.livejournal.com]

I hate the schools. I really do. I'd like them all to go bankrupt and force us to start again.

I have a hard time with these numbers and want more verification, but as I understand it, somewhere near 20% of all u.s. high school graduates are functionally illiterate. that's higher than it's ever been, even though we spend more per child than we ever had. Even if you try to tie it in as a percentage of our earnings that we spend per child, it's still higher.

Money isn't helping the schools.

We seriously need to drastically rethink our strategy towards teaching our children.

Aside from that, property taxes pay for schools, that's a county tax, not affected by income tax. Unless you're talking about federal grants?

Re: here's the problem I'm having with all this

[not-hothead-yet.livejournal.com]

I understand hating the educational system we have; I hate it too. Unfortunately, there are a lot of kids going to these schools right now and yanking all the monies away from the schools right now isn't going to make ANYTHING better. You say money isn't helping the schools, well that's a difficult position to argue because there isn't a lot of money going to the schools anyway. How can you say money isn't helping someone if you're only giving them 40% of what they need to survive? So the answer is to give them higher standards and cut their funding?? That's exactly what Bush did. Now schools are doing worse... bfsurprise!

Federal grants don't make up much of the school budgets but what most people are talking about when they refer to federal funding of schools is the disparity between the new standards ("No Child Left Behind" act) and the drop in federal grants for programs that help enact the changes necessary to meet the new standards. If a school has a failing literacy rate, most likely the school needs tutors, specialists and specialized materials to get that literacy rate back up. You don't attack a problem of failure by applying the same methods that brought you there, yet that is exactly what many schools are having to do because they cannot meet the new standards without getting additional funding to apply NEW methods.

Then there's special education... the vast majority of education funding for special education does come from federal grants/programs. It's a whole different ballgame than "regular" education. Yet, the new NCLB act requires ALL students at every school, including "special" students to take the test and have their scores averaged into all the other kids' scores. Where's the fairness in that? The catch-22 is that IF a school has a special ed class (or even just one student) they can get approved for MUCH more funding in order to meet the special needs of the child(ren) but then they have new scores to average into their entire schools grade - how likely do you think it will be that an Autistic child or a blind Down's Syndrome child will bring UP the schools average score on the all-so-important tests given to us by the wonderful NCLB act? Hahaha.

Sorry, I went off, but the subject of education is much more complex than just "they suck, let's pull the plug on them".
At the very least, you really want thousands of children running around all day unsupervised?

Re: here's the problem I'm having with all this

[polychromatic22.livejournal.com]

Oh, a couple more things (sorry I become dumb when school issues come up, I'm an idiot about it)

Poverty spending:
I simply don't understand it. I really, really, really don't. Everyone I know is poor. I am surrounded by very, very, exceptionally poor people, including myself. Nearly all of them make unbelievably bad choices with their money. They all purchase cable, have big tvs, drive expensive cars, buy expensive clothes and the list goes on.
I don't think this is going to stop the poor from spending. I'm hoping it will encourage them to buy more used goods. The smart poor always have. Thrifting is great fun, and a life necessity if you got no dough.

I don't expect corporations to become philanthropic. I expect them to want to sell their product, and if they can drop their prices 3% and still get all those perks you mentioned I bet they'll do it. And I bet the next company will drop 4%, and so forth. I don't know that it'll ever come down further than 10-15%... It seems a lot to ask or expect or hope for, but some drop, yeah. Corporations like making money, if they think they can increase market share while not increasing expenditure, they usually do it.

The smart companies will take this as a way to reinvest into their business and go even further.
I don't expect many businesses to be that smart.