Woodall introduces FairTax bill on day one with record number of original co-sponsors
I haven’t had time to follow the FairTax situation closely in recent months, but this caught my eye:
WOODALL INTRODUCES FAIRTAX BILL ON DAY ONE WITH
RECORD NUMBER OF ORIGINAL CO-SPONSORS
Washington, DC—On Wednesday, January 5, 2011, Congressman Rob Woodall (GA-07) introduced H.R. 25, the FairTax. The FairTax legislation eliminates the current income tax paradigm and replaces it with a system of taxation based on consumption. The bill was introduced on Wednesday with 47 original co-sponsors—the most original co-sponsors the bill has ever had for its initial introduction.
“I committed to the Seventh District of Georgia that my efforts in Congress would focus on reclaiming freedom for theAmerican people. It is for that reason that I am proud to make the FairTax—the only bill that restores transparency and simplicity to our tax code—my very first action in Congress. I have said since its inception that the FairTax is not a tax bill; it is a freedom bill,” Woodall said.
Woodall, who was sworn-in to Congress earlier in the day, played an integral role in crafting the original text of the FairTax as former Congressman John Linder’s Chief of Staff when the bill was originally introduced in 1999.
“Our current tax system is a bloated, convoluted mess that gives government power over Americans’ pockets. With 47Members of Congress and counting signing their names to the FairTax, we are closer than ever before to voting on legislation that eliminates the frustrating mess that is the IRS.”
Although the FairTax was introduced with 47 original co-sponsors, Woodall anticipates adding many more Members of Congress to the bill. Once the FairTax is introduced with the original co-sponsors, Members are able to sign on to the bill as co-sponsors throughout the 112th Congress.
“The number of signatures on the FairTax this time around is a testament to the will of the people. It is clear that Americans do not want to have their hard-earned money taken away and they want to reclaim the freedom to spend their money how they choose and when they choose.”
The list of original co-sponsors is as follows:
1) Tom Price (GA)
2) Brian Bilbray (CA)
3 ) John Carter (TX)
4 ) Michael Conaway (TX)
5 ) John Duncan (TN)
6) Virginia Foxx (NC)
7) Steve King (IA)
8 ) Michael McCaul (TX)
9) Pete Olson (TX)
10 ) John Sullivan (OK)
11 ) Mac Thornberry (TX)
12) Phil Gingrey (GA)
13) Roscoe Bartlett (MD)
14) Don Young (AK)
15) Ander Crenshaw (FL)
16) Todd Akin (MO)
17) Lynn Westmoreland (GA)
18) Tom Graves (GA)
19) Gus Bilirakis (FL)
20) Ted Poe (TX)
21) Randy Neugebauer (TX)
22) Jeff Miller (FL)
23) Robert Wittman (VA)
24) Jack Kingston (GA)
25) Marlin Stutzman (IN)
26) Jeff Flake (AZ)
27) Billy Long (MO)
28) Cliff Stearns (FL)
29) Tim Walberg (MI)
30) Dennis Ross (FL)
31) Dan Boren (OK)
32) Mo Brooks (AL)
33) Darrell Issa (CA)
34) Richard Nugent (FL)
35) Tim Scott (SC)
36) Blake Farenthold (TX)
37) Jeff Duncan (SC)
38) Rob Bishop (UT)
39) Mike Pence (IN)
40) Sandy Adams (FL)
41) John Mica (FL)
42) Sue Wilkins Myrick (NC)
43) Dan Burton (IN)
44) John Culberson (TX)
45) James Lankford (OK)
46) Mike Pompeo (KS)
47) Gary Miller (CA)###
Jennifer Drogus
Communications Director Congressman-elect Rob Woodall
Seventh District of Georgia202.225.4272 | jennifer.drogus@mail.house.gov
Joshua,
You haven’t missed a single Fairtax thing over the last few months. And, while 47 original cosponsors may look impressive, not one of those cosponsors is a member of the Revenue subcommittee of the W&M Committee. The Revenue subcommittee is the current resting place of HR25, but it doesn’t appear that even a hearing would be likely with that subcommittee membership.
Perhaps more interesting is the fact that Woodall didn’t get appointed to the W&M committee, but instead seems to be on the Rules committee. Linder was at least on the Revenue subcommittee where all tax bills must originate, but he wasn’t able to get a single hearing on HR25 in twelve years. Is all this musical chairs really progress? I don’t think so! If Fairtax advocates want to see any progress, they better concentrate on getting the seven Republican members on the Revenue subcommittee to sign on to HR25. Then at least we might see a HR25 hearing where the facts about the Fairtax will become public knowledge. Stay tuned!
To say that there This list shows a “RECORD NUMBER OF ORIGINAL CO-SPONSORS” is typical of the promoters’ slimy deceptive advertising.
In the last Congress, they had about 65 co-sponsors. Only a fraud can have a lower number and yet call it a “RECORD NUMBER”.
Even if the entire Ways and Means Committee drank the Kool-Aid, it would not help this disister of a bill.
A lot of people in Congress are waking up to this disaster.
I would say that most of them do not support H.R. 25, as written, as AFFT and the promoters would like us all to believe (its just another tool in their smokescreen).
The concept of a sales tax versus and income tax has superficial appeal to some in Congress and they would like to hear alternatives discussed. They know that any bill that comes before them will be torn apart, amended and restructed.
The AFFT (Woodall) does not want the public to understand these important facts, merely to advertise “look how many Congressman support HR 25″- they are shameless snake -oil salesmen.
they just want peopel
Whoa up, big fella,
You may not understand it but Woodall is counting “original” cosponsors. Those 47 are the ones that signed on prior to HR25 being dropped in the hopper. It is a record for HR25. Future cosponsors will be added but they won’t be original cosponsors.
Original or not, I’m still hoping that my $10 bet with Jim Bennett, my NJ friend, will hold up. That is, the number of cosponsors in the 112th Congress won’t exceed the 72 that signed up in the 110th. Stay tuned!
Hank,
What I am saying is that they had 65 in the last Congress and now start off with only 47 even though they are likely find even more suckers/constituent-deceivers.
At this moment I believe it to be very deceptive to say RECORD when you have fewer co-sponsors currently than you had last week – even IF there is a TECHNICALITY that maybe it the largest number of co-sponsors on day 1.
Their spin would make a gullible victim think that they now have more support in Congress than ever.
Also, my points about what Co-sponsorship truly means are still relevant – AFFT/Woodall failure to explain the truth about how little it really means to have “Co-sponsors” is at the root of their deception. This is just like the slick sales pitch “80 economists signed on to HR 25″ – the deception keeps rolling on.
I am sorry, but such sliminess in trying to fool people makes me mad
While I have not done detailed research, it appears that about 30 names dropped off the prior list of 65 )about 12 new signers).
I do not think that more than 10 (a friend reported 10) of the prior signers were not re-elected, which would leave aboiut 20 former co-signers who have BNOT RE-UPPED. Perhaps some of them have learned what the FT is really about and they can no longer support (not HR 25 itself) but even the possibility of discussing it.
After 10-15 years of trying (plus the original $23MM plus all the $MM spent on grass-roots activities), and so little (and declining) support.
Its time for Woddall/AFFT to fold up their tents and go in search of a useful tax system. They need to stop wasting their and our time and e3nergy on this FT, a non-starter of an idea.
I’ve got a question perhaps someone can answer for me.
We all know that the Joint Committee on Taxation reviewed the FairTax back in 1998 (and, possibly, 2000) and concluded that the tax-exclusive rate would need to be between 57%-59%.
As I understand it, any tax proposal has to be “scored” by the JCT, just as spending proposals have to be scored by the Congressional Budget Office (CBO). In other words, in order to calculate budgets going forward, the CBO estimates spending and the JCT estimates revenue.
I also understand that any member of Congress can ask the JCT to score any tax proposal, and that the JCT’s analysis will be kept confidential unless the Congressmand or Senator requesting the anaysis asks for it to be made public.
So, my obvious question is, if Woodall and the 47 co-sponsors of the FairTax bill are so certain that the tax-exclusive rate would be only 30% and that the 1998 JCT report was wrong, why don’t they ask the JCT to re-score the bill and publish the results? Why didn’t Linder do it before he retired?
I think I know the answer, but I’m curious whether I have missed something.
Hayden,
I do not know much about those procedures.
I think that even if they score it, the must use the facts, etc of the bill and thus they are unable to take into account their judgment of the realism of the bill’s assumptions. Some comments like this accounted for the CBO being unable to realistically score Obamacare.
Thus, JCT might be unable to provide their more realistic assumptions about tax avoidance – they most likely could not change the tax base.
Stephen — My understanding is the JCT was charged with determining that the “revenue neutral” rate of the FairTax would be assuming that the base was as large as projected by the FairTax proponents. In other words, they did not exempt housing, medicine, health care, etc., but did give some allowance for tax avoidance. From that they concluded that the revenue neutral rate would need to be 57%-59%.
My question, particularly for the FairTax supporters, is why doesn’t Goodall ask the JCT to do that once again if they think the JCT got it wrong the first time.
Hayden,
I was not referring to what the JCT did in that priot study, I was talking about today.
I suspect that Woodall knows that the answers would not come out looking good for H.R. 25 and he therefore stays away from asking JCT to score it.
I will follow up and try to get some info on JCT’s scoring process (i.e., including clarifying what their/CBO’s limitations are). You have raised a really good question.
Hayden,
I’m going blind reading every JCT report for 1998 through 2003. No mention of HR25 or the Fairtax. What is your source of the input that the JCT did indeed review the Fairtax and concluded the revenue neutral rate would be 57% or whatever?
Thanks!
Hanks correct, the JCT did not score the FairTax, but to Hayden thought I think they did score a NST. I think it had huge exemptions (the tax base was under 50% of GDP). So of course, if you remove half the tax base, you get a rate that is twice as high. It’s not HR25 – strawman, no one would support such a system.
Take a look at “Rebuttal of the Joint Committee on Taxation (JCT) letter” by Burton and Mastromarco. Keep in mind this is from 1998.
Linder did ask the bill to be scored as written, and the Chairman supposedly agreed to it, but it never happened.
Morphh,
I skimmed over that Rebuttal – it seems to be talking about the Ken Kies report in 1998. I don’t know if Kies is still working – I knew him well when I was working and may be able to contact him. It appears that that Rebuttal does not mention the issue of the JCT not scoring HR 25 at all, but refers mostly to general errors in calculating the base. I did look for Kies’ original Report.
There was also the Lindy Paul letter in April 2000, but I have not researched any new JCT study that might have been conducted after Kies’. I believe it is that letter which mentions tghe 57%. See fn # 30 of my Paper.
Does anyone know if there were any changes introduced this session?
Morphh,
I have been checking Thomas every day, but the text of the legislation still hasn’t been sent by the GPO to the Library of Congress. Usually takes only two days, but it has been a week and still no text?
I heard rumors of some changes, but until we can read HR25, who knows?
I might have gotten my letters mixed up. I seem to recall there were two letters from the JTC. One from 1998 (at the request of Bill Archer, the original proponent of the FairTax and the then-chairman of the Ways and Means Committee), and one from 2000 (at the request of John Boehner). If I recall correctly, both of these letters concluded that the tax-exclusive rate would be between 57-59 percent. And, though they might have referred to a National Retail Sale Tax (rather than the FairTax), I’m pretty sure the letters referred to what is now known as the FairTax. Anyway, this begs the question: Why wouldn’t one (or all) of these co-sponsors ask the JTC to re-score the FairTax? It can only be that they don’t want the results known.
I wish Morph would have put up those letters (or, if there’s only one, the letter) in the research section, but Morph decided that these didn’t constitute “research” because they didn’t explain how they derived their numbers. Still, I think it would be helpful to show that the JTC had looked at the FairTax.
By the way, even a cursery review of the “Rebuttal” that Morph cites is full of holes. It starts by saying that Jorgenson, Poterba and Kotlikoff had done studies proving the 23% rate. We all know that Jorgenson and Poterba have publicly stated that they never did any such studies (and Jorgenson, at least, publicly opposes the FairTax.) Kotlikoff told me that he had not done any such study at the time, but only, at best, a “back-of-the-envelope” calculation which noone would consider an actual study. (Of course, he’s since endorsed the BHI study, but that was seven years later.)
Hayden,
While mucking around in the reports of the JCT, I came across what looks to be the father of the Fairtax, namely HR3039. Go here: http://www.jct.gov/publications.html?func=select&id=30 and scroll down to the April 14th, 1997 report.
Forget the first 60 pages, but starting on page 62, is a JCT discussion of a National retail sales tax based on the Retail Sales Tax Act of 1996, HR3039. This alternative to the income tax was basically a 15% sales tax on all goods and services which would replace the income tax only. It taxed government consumption, had a financial intermediation service tax, taxed imports, had a family consumption rebate, and phased out the IRS. The SSA was charged with continuing to collect payroll taxes.
Unfortunately, it doesn’t seem to have been scored, nor was there any discussion about how they came up with 15% that I could find. It does make for interesting reading and calls into question my former belief that the Houston group started with a clean sheet of paper?
Hank — I’m from Houston and can give you what background I have from my rapidly-fading memory. As you know, the Dem’s controlled the house for 40 years until 1994. Bill Archer was my Republican representative, and served for years as the ranking minority member of the Ways and Means Committee. By all accounts, Archer was an ethical member of Congress and became totally disenchanted with the income tax system. In particular, efforts to reform it were always undermined by special interest groups which would work behind the scenes to get in special exemptions and the like.
So, Archer went around the country claiming that we needed to “rip the income tax system out by its roots so it’ll never grow back” and replace it with a consumption tax. I think he was originally in favor of the Retail Sales Act you reference above. Archer was the congressman to an affluent area of Houston which (I believe) included all three of the FairTax founders among his constituents. It’s my general understanding that they devised the FairTax as a way to further Archer’s vision.
In any case, when the Republicans took over the House in 1994, Archer became the chairman of the Ways and Means Committee, and the FairTax group promptly hired Patton Boggs and other lobbying organizations and various economists to try to promote the FairTax in Congress. I believe this ultimately led to the 1998 report by the JTC, which threw cold water on the whole idea.
I never heard Archer promote the FairTax (or a consumption tax) after that, and he retired in 2000. All of the Republicans competing for his seat immediately swore allegiance to the FairTax and totally ignored the JTC report. Until I moved to Atlanta in 2001, I thought it was only the crazy Texan Republicans that liked the idea, but thanks to Neal Boortz the Georgia Republicans are even more enamored with the FairTax than the Texans are.
I could be wrong on the dates, but I’m pretty sure this is generally how it shook out.
Hayden, I’m not sure that I’ve seen either of the letters that you describe and I don’t recall rejecting them on the research page. Also, I don’t see that the rebuttal starts by saying that these individuals did studies as you suggest. It says they confirmed AFFT’s analysis, saying they “found” the rate to be … If they were studies, they probably would have promoted that point, so it seems to me they’re saying .. these guys did “back-of-the-envelope” calculations. This was back in the 1990′s, before they had done the formal detailed studies.
Morphh,
This is in response to your post on Replacing the Income Tax Part II. I felt it belonged here in this discussion.
I understand your point about allowing Woodall his small victory. I do not deny the very small point he is making.
What I object to strongly is the overall spin of hot air by which HR 25 is constantly, superficially sold to the publict. That press release was carefully worded and was not a lie per se (intelligent people understand the limited statement Woodall is making).
However, the great unwashed out there in America do not understand his Bill Clinton parsing of words and will gain the wrong impression that HR 25 now has more suppport than ever in Congress and IT DOES NOT.
BTW, I also object to AFFT’s inference that co-sponsorship means kamikaze-like support of H.R. 25, when in fact most of them likely simply superficially like the idea of a consumption tax and want to see an NRST discussed, not necessarily HR 25 (just like their 80 economists). Also, their attitude is that every bill will be modified (contrary the AFFT’s wishes and beliefs), so that they are not at all wedded to H.R. 25, as written.
How do you know that it does not have more support in this Congress? The Congress just started. Based on history with cosponsors, it very well could be the most supported. That’s the point of the release. The “great unwashed out there in America” are never going to read this release. It is meant for those that follow the bill closely, like us. I guess if you’re looking to nit pick everything you can, you’ll eventually find fault in anything. What’s “hot air” is people trying to turn every statement into the acts and motives of evil men.
Morphh,
I guess I am just oversensitive to their hype because they just use so much superficial hype to sell this product.
Morph — Are you sitting at home in NC snowed in like I am in Atlanta?
I apologize if you hadn’t seen those letters. I had thought you did. (They’re only a couple of pages long, or so, which was why I had thought you had declined to post them under the research lin.) I’ll try to dig them out of my files if I’ve got copies of them and email them to you.
Hayden,
Thanks for the additional background info. While you are mucking around in your files, do have a copy of the Archer/Princeton survey of those 500 companies and their reaction to the Fairtax? I’ve tried many sources, including writing to Archer directly, with no luck. I’d sure like to see just what was presented to those companies that elicited the reported reaction that 80% would come rushing to our shores?
Thanks!
P.S. I don’t know about Morphh, but I am up to my ears in snow here in Hendersonville. Haven’t seen snow for 15 years, being as how we spent all winters in Florida, but for my money, you can keep all the snow in Atlanta!
Hayden, indeed I was buried yesterday in snow and today in ice. However, we only had a delay today, so I had to come in for a little while. Thinking of Atlanta, I’ll be out there for a conference on the 18th-19th if you want to try and get together.
Morph — Yes, I’d love to get together when you’re in town. Email me directly (if you still have my email address) and we’ll figure out particulars.
Hank — I believe the Archer “survey” is one of those FairTax myths that keep getting repeated over and over (and exagerated each time.) I suspect it was not any sort of formal survey, but, at best, Archer might have spoken to a group of executives and said something like, “How many of you would move your headquarters to the US if your companies didn’t have to pay any corporate or payroll taxes?”
I suspect the response would have been different if he’d asked, “How many of you would increase your operations the the US if you need to pay 23% of your gross revenue in taxes to the extent you sell products to the American consumer?”
I just read Karen Walby’s written testimony to the House Ways & Means Committee on the FairTax.
http://fairtaxnation.ning.com/profiles/blogs/testimony-of-karen-walby-phd
One of the key quotes (in my opinion) is this:
“A Minnesota study in the year 2000 compared input-output data to taxable sales and estimated how much tax should have been collected. The difference between estimated and actual collections was 9.9 percent. The sales tax gap was therefore an estimated 9.9 percent in Minnesota.”
Now, according to Wikipedia, Minnesota imposes a state sales tax of 6.875%., which can increase a point or so when city taxes are included. That’s on a tax-exclusive basis. So, according to Dr. Walby’s own testimony, a sales tax rate of somewhere between 7 and 8% results in a non-compliance rate of 9.9%
So, the obvious question is, what would happen to the non-compliance rate when a national sales tax (of, at least, 30%) is added to the state sales tax rate (for a combined rate of over 37%). Obviously, noncompliance rates will skyrocket.
Yet, the one FairTax study that attempts to “prove” that a 30% FairTax rate is even remotely “feasible” assumes a non-compliance rate of zero.
Once again, a careful reading of the data that’s being pushed by even the most ardent FairTax proponents shows that it simply doesn’t work.
Hayden,
Thank you. I believe that some HR 25 advocates have claimed that it assumes the same level of tax avoidance as the income tax. You say absolutely zero (which study was that?).
After thinking I saw a factoe for tax avoidance in one of the BHI Tables, I could not find it again. Instead it appears that there simply was no specific allowance for tax avoidance.
It would be good to clear this point up.
The BHI/Kotlikoff study done in 2006 is the only one I know of that is “endorsed” by AFFT. That’s the study that said the tax rate could be 31.25% on a tax-exclusive basis. (It’s available in the Research section above.)
I had spoken to Kotlikoff about it before he released it, and he told me that tax evasion/avoidance had not been factored into the numbers. When the study was published, however, they said that the NIPA numbers they used presumably had some tax evasion/avoidance already factored in. However, in a subsequent seminar at American Enterprise Institute (available on line at the AEI website), Kotlikoff apparently learned for the first time that the NIPA numbers had factored out any tax avoidance/evasion. In other words, the BHI/Kotlikoff study in fact assumed 100% compliance with the FairTax. (Although, in fairness, the study did not factor in any increased economic activity that Kotlikoff thought would occur under the FairTax, which he said should mitigate the loss of revenue from tax avoidance.)
At the AEI conference, there was a disagreement between Kotlikoff and some of the other presenters as to how factoring in tax avoidance would affect the required tax rate of the FairTax. Kotlikoff seemed to think it would only raise the required rate by a couple of percentage points, but Jane Gravelle (of the Congressional Research Institute) produced the results of various studies on sales tax avoidance (including the Minnesota study) indicating that the level of tax avoidance (and the resulting required tax rate) would be extremely high.
The study done by William Gale of the Brooking Institute had a number of tables in an appendix showing the reqired tax rate under various levels of tax avoidance. At even a 10% level of tax avoidance/evasion, the required tax rate rose by a very substantial amount. It’s just one of the many, many flaws in their plan that the proponents just won’t talk about.
Has any one calculated if taxes will go down? Is this proposed tax being constructed so as to be revenue neutral, or close to it?
The U.S. economy is burdened with taxes so much that I think people can’t even see it anymore. Will this tax lower the tax burden across all in our economy, or will it not?
Does any know? Has anyone thought about it? Does anyone care? Does anyone think it important?
I submit that the H. R. 25 sales pitch intends for people to read about the Congressional co-sponsorship and superficially assume that these co-sponsors believe that H.R. 25, AS WRITTEN, is the one correct answer.
After talkiing to my Congressman, I submit that a lot of those co-sponsors have not read it but merely want to start a dialogue to replace the current Income Tax with a better system.
Fairtax is a great idea — as we all know.
But if a magic pony could eat hay and expel gold, that would be a great idea, too.
As Bertrand Russel said “2 +2 = 5, therefore I am the pope”.
Fairtax has added 2 plus 2 and come up with 23. Only they don’t believe a word of their own additions. To get to 23% — you had to hid a trillion dollars in taxes, an entire “second tier” of taxation.
We all know the first tier — tax on personal consumption.
But in the fine print we find a trillion dollar second tier. Furthermore, your own spokesmen have more or less admitted none of this was “researched” at all, just ASSUMED. The Fairtax plan just “assumes” they can collect this massive second tier — no research on the feasibility of it whatsoever,
What you call “research” is simply telling us how great it will be when you have all this money from this imaginary second tier. It’s imaginary because it’s impossible to collect this money.
Some people say “Well of COURSE the government can pay taxes — they pay it NOW in FICA and embedded taxes”.
No they don’t. Only people pay taxes, remember? And Fairtax’s imaginary trilion dollars in taxes on government, would be paid BY PEOPLE.
Most of you who read these comments ( all three of you) already know the hidden fine print, which Fairtax has tried to sneak by,
Here is is — as sent to me by Ross Calloway, Fairtax spokesman
The FairTax Act of 2011
Sec. 2 (a) 7: Person
‘(7) PERSON- The term ‘person’ means any natural person…. any……. government….. administration, organization, association, or other legal entity (foreign or domestic.)
So only PEOPLE pay taxes — then Fairtax hides the word “government” in a list of other things, that define people. Funny stuff!
In follow up questions to David Kendall, Ross Calloway, and James Bennet — all expert Fairtax spokesman — agreed that this means city state and county governments will have to pay massive taxes.
In fact, the spokesmen admit this is how Fairtax math works. And these governments must pay to the federal government a massive tax.
You can tell Fairtax “insiders” don’t believe a word of it, because of how deeply hidden this language is. In ten years, in seven books, in a thousand speeches, in a thousand videos, they NEVER MENTION IT.
Except on odd sentence in one book — read this sentence.
“Under our plan, all city and state governments will pay to the federal government a tax on all their spending — on all their purchases, on services and goods, including labor (wages).” Fairtax Answer Book, page 138
So the government will pay taxes on all their spending (except education) and on WAGES.
All government wages – - taxed. Every cop salary – taxed. Every military salary – taxed. Every government pay – taxed. This is right back to a wage tax!
Really amazing!
But that’s nothing compared to the totals of what city and states would have to pay — keep in mind, its all hidden!
Kendall claims he “sees no reason city and state governments should not be asked to pay their fair share”. Maybe because you arent ASKING — y ou are hiding this in the fine print?
So your spokesmen talks about ASKING city and states to pay – but there is no asking. In fact, you dont even TELL the city and states — you just hide this in your fine print.
Do you really think that’s going to work? Do you? No – you don’t. You know it’s not for real. You know you have no intention of passing your own bill.
In less print than comes on the back of a candy bar — Fairtax has hidden a trillion dollar tax on cities, counties, and state governments. Los Angeles city government would owe 700 million! Knoxville TN city government would owe 30 million.
I don’t eat candy bars anymore, cardiologist orders, but a Butterfinger has more information than Fairtax gives about this tax.
States too, of course! Texas would owe 9 billion, California state governmetn would owe 14-16 billion. The fine print doesn’t give a list of states, or cities, and their expected tax burden.
In fact, it’s almost a miracle anyone could even spot your fine print about the government being a PERSON — Ross Calloway was so proud of that little trick of language — he sent it to me, with exclamation points — like this !!!
He was PROUD that the fine print said the government is a person!
Yet no one in ANY of these states has any clue! Fairtax pretends to be “a tax on personal consumption”.
But in the definition of a person — as you see above, they claim governments are people! Funny stuff!! Only people pay taxes — EXCEPT when Fairtax can sneak in the word “government” in section 2, sub paragraph B, exception A, etc etc.
No one takes this seriously any more.
Mark,
Great piece, made all the better by your discontinuing the frequent use of the F-bomb? And, while you didn’t mention it, I also believe that federal taxation of State/Local government consumption is absolutely unconstitutional!!!
I do have one question about your $trillion dollar tax number. The only authoritative study I have is the Sept, 2006 Beacon Hill study entitled “Taxing Sales–What rate works?” In that study, federal, State, and Local taxable consumption is $2 trillion. The tax revenue from that government spending would be $460 billion, not $1 trillion?? So, wouldn’t it be more accurate to state that the Fairtax hides half a trillion in taxes which can only be paid for by us?
In addition, I have a feeling that Morphh, or someone, will point out that the $916 billion in federal taxable consumption isn’t real. or at least doesn’t change the Fairtax rate. I never have understood that claim, but it is sure to come up for discussion.
Mark,
I really enjoyed your post. You know BHI said in it 2007 study that the 23% (30%) TAX RATE DOESN’T WORK – IT DOES NOT ACHIEVE REVENUE NEUTRALITY (IT LIKELY NEVER DID) AND THAT THEY REALLY NEED TO MAKE IT 26% (35.1%).
THE HR 25 ADVOCATES SORTA KEEP THIS A LITTLE QUIET.
Fair Tax
Among doing other things with my time, I have for the past couple years indulged in, at least thinking about the Fair Tax plan. And I have finally come to the conclusion, that it is, plain and simple, communism. The communists, have joined up with the Radical Individualists, or Libertarians and using the old proverb, “there’s a sucker born every minute”, have taken modern sales strategies to a new height, using a real life Manchurian Candidate, in the guise of a radio talk show host, they have conned millions of Americans into believing the Fair Tax is a right wing capitalist panacea.
We tend to dissect all things to extreme levels, with doing that, we increase the difficulty in understanding, what is, sometimes, at the tip of the nose. It really is very simple, as we know the middle class Americans will assume the burden of this tax, as they do now, because the middle class , constitutes the majority of the people. We know that the fair tax will adjust each year, as we know the nature of things, the government, will always increase the tax, never lowering it. The end result, is a middle class man that buys a new car every 5 years, spending $20,000 dollars, plus another $2,000 for taxes will now be spending $30,000 for the new car, and we can rest assure, it will be up to that in 5 years. So, the middle class man will start buying a new car every 6 to 7 years, and that means the manufacturers will sell less cars. As businesses lose customers, they in turn, will ask the government to bail them out, and that means more government takeovers. You see, it doesn’t take a rocket scientist to figure this out, the middle class people will have to spend more, and consequently they will buy less often, our economy will grind to a halt, and the government will step in.
I’ve suspected Boortz is a closet communist for some time now. He refuses to discuss abortion, and we know that is what a liberal does. He supports homosexual liberation, and embraces sexual freedom, and that my friend, is the common denominator between RE and RI. Radical egalitarianism and radical individualism have a lot in common. As Robert Bork said in his book, “Slouching Towards Gomorrah”, we must resist radical individualism and radical egalitarianism, in every area of culture. If ever there was a “real life” Manchurian Radio Talk Show Host, Boortz is it. Is that so hard to believe, that traitors exist? Remember Aaron Burr, Jane Fonda, how about Axis Sally, and Benedict Arnold, and George Trofimoff, the highest ranking spy/traitor in America.
The notion that everything in life runs full circle, can be applied to the similar nature of communism and libertarianism, they both have the same goal. One must remember that the final stage of communism is, “a place we have never gone before“, like they say in Star Trek. That is a system without the dictatorship of the people, where every communist is equal, and works, shares, bonds, with his fellow man in some utopian way, self governing people, and that resembles the libertarian plan, a world with less government.
Isn’t it sad, that some celebrity can say almost anything, and the whole room goes gaga over it . Boortz writes a book, telling us to change our entire tax system, and possibly put us, the American people, to our final resting place, as a government, and nobody, from right wing America has enough sense to challenge it.
The experts convolute the math, as they always do, for it’s their nature. The use every imaginable formula to define and measure it, from
Algebra, geometry, trigonometry, calculus , combinations, differential equations, complex analysis, theory and logic, probability, and statistics, and all the other theories, number, chaos, model, and set, and many more types of math, and that’s just tip of the ice berg. In the end, so many volumes of thought, will have been created. Leaving us, what we commonly call “red tape”, a mish mash, hodgepodge, can of worms, so distant from the true spectre, that few can recognize it from ghost or reality.
And that’s just what the homosexual loving, abortion supporter, radical individualist, friend of the communists, Boortz wants us to believe. Go ahead, follow Boortz, and see what your get! Just remember, the middle class of America is the majority, that’s why they are called the middle class. When the middle class is forced to spend more, then they will buy less, and when they buy less, the factories will make less. The increase in prices, caused by a “fair tax” will not go into the factory pockets, so the manufacturers will sell less than they do now. As millions of businesses fail because of Boortzs tax, the government will step in and bail them out, and in some cases the government will take over. I’m surprised the democrats have not taken us up on this already. Obama’s dream of a socialist state can come true, with the help of his good friend Neal Boortz.
As I listen to some congressman “pander” off numerical excuses for the fair tax, I wonder, if the system fails, will they give everybody their money back? NOT! If the fair tax system failed in the first few years, could America go back, or would it mean the end of a country, would war follow suit?
After reading all the comments, it’s like I said, this fair tax theory has alot of math hypothesis, how silly this is, it’s like soft science, psychology and sociology, they can created all kinds of polls and surveys, but not objective science, it’s opinions with trumped up math, and it’s dangerous to consider it. Einsteins half dead cat, quantum mechanics would apply, as factors will constantly change.
to: vanhellslinger
Have you read my Paper, Replacing the Income Tax on this site – it will give you lot’s more ammo.
Boortz is dispicable. He was just on FOX with his sleazy, supeficial one line pitches in response to Eric Bolling’s simplistic, uneducated (on the FT) feeds.
All of their math is, as you poinbt out, quite hypotghetical and the assumption are grossly unrealistic (e.g.,no tax avoidance). In summary, they ask people to take as an assured fact, that all of their assumptions will deliver truth. It seems to me to be a gigantic leap of faith (based on incorrect economic assumptions).
Restoring fairness and simplicity to our tax code. Amen!
Check out http://buriedbytaxes.blogspot.com/2011/08/welcome.html.
The thing is:
just who are these co-sponsors. From what I’ve seen : fairtax is overwhelmingly a _Republican_ measure-and largely supported by those with a more rural, poorer white constituency. I happen to come from that kind of background-and can understand the appeal. Fairtax is a clear win for those with a very low consumption lifestyle. The issue is FAR less clear for folks in urban areas that have a higher cost of living(i.e. $50K/year in rural Missouri is VERY different than $50K/year in New York City).
What I think is really needed here: some really good polling to show where the gaps in support are-and how that might be fixed. I think we can come up with a tax proposal which really does simplify taxes for most folks-but has much broader support than fairtax now does.