Looking For Somebody To Write An Analysis On The Fair Tax

[Politicallore]

LOOKING FOR SOMEBODY TO WRITE AN ANALYSIS ON THE FAIR TAX

Anybody interested for writing an article for my website www.politicallore.com ? Could lead to more work in the future, as I am looking for writers. Must be about 1/2 page in length, or more. Must have a negative view of the fair tax for everyday Americans. Be personable, informative, funny, but serious.

I do not pay my writers, but If an article is that good I might have too... If money is not involved I will link to any cause of your choice at the bottom of the article, urging others to donate. I ask that this be an original article, with my website being the only placement that it will get.

As you know my website is a news/blog site supporting Ron Paul for President. We need to win this for our general well being.

Thanks,
Alex

[atilla]

from an economic stand point the fair tax would be advantageous versus an income tax bringing in the same amount of taxes. with a sales tax you discourage consumption and encourage savings and investment. if i have a favorite stock and i want a new dlp hdtv, if i buy the tv and have to pay 28% tax on it (plus state sales tax too) it just might piss me off enough to decide i don't need the tv and buy some more stock instead.

now keynesians would say that would cause a huge depression and "90% of the economy is consumer based", which is kind of true, but you don't get rich by buying a bunch of consumer crap. individuals get wealthy by saving and investing instead of consuming. nations get wealthy by encouraging savings and investment and discouraging consumption. so, i say the keynesians are a bunch of poopy heads, (although i did receive an award as the outstanding graduate in economics from a keynesian about 15 years ago)

the other big thing in our economy about a sales tax (the fair tax) is that we tax manufacturers on their profits from exports, most other countries don't tax foreign earnings thus giving their manufacturers a tax advantage. the fair tax would leave exports untaxed. practically this probably isn't that big a deal as most U.S. companies have set up tax dogging foreign subsidiaries to "offshore" their income. but it couldn't hurt and could defiantly help small non-multinational manufacturers.

atilla the hun

your friendly local financial economist

[steph3n]

Look at HR25 is has some scary provisions I can tell you someone that may be interested in writing such an article I will PM you the data.

[Brian4Liberty]

The thing that really bothers me about the "Fair Tax Plan" is the universal "Prebate". They don't advertise that too much.

Essentially it's welfare for everyone. Everyone gets a check from the government every month. This just makes the whole thing more complex, prone to fraud, and will result in huge costs.

They "estimate" the cost of sending out the prebates at $2.7 billion per year. Of course like all estimates, that's probably way too low, and would grow from there over time.

Read more:
http://www.fairtax.org/PDF/FairTaxPrebateExplained2007.pdf

[peacemonger]

I really don't think its such a bad deal. We do need to focus on cutting costs but the prebate check has some benefits too. I consider the Fair Tax people to be allies. It would get rid of a lot of the tax lobbyists in DC too. There are a lot of good things about the Fair Tax. Everybody should read the book if they haven't already. It only takes a few hours to get through it.

Don't hate!

[Drknows]

Fair Tax = New IRS

[Lord Xar]

wouldn't a problem exist as inflation rises, and the value of the dollar decreases you will actually be paying more in taxes over time.

for instance, I get a 3% standard of living raise. BUT, if the cost of living goes up 7%, then I have to pay more (cause my dollar buys less), AND pay more in taxes even though its the same percentage...

[vinwal]

http://www.mises.org/story/1975

[Ron LOL]

The Fair Tax is actually a good thing if you're going to collect a tax.

[Patrick Henry]

LOOKING FOR SOMEBODY TO WRITE AN ANALYSIS ON THE FAIR TAX

Anybody interested for writing an article for my website www.politicallore.com ? Could lead to more work in the future, as I am looking for writers. Must be about 1/2 page in length, or more. Must have a negative view of the fair tax for everyday Americans. Be personable, informative, funny, but serious.

I do not pay my writers, but If an article is that good I might have too... If money is not involved I will link to any cause of your choice at the bottom of the article, urging others to donate. I ask that this be an original article, with my website being the only placement that it will get.

As you know my website is a news/blog site supporting Ron Paul for President. We need to win this for our general well being.

Thanks,
Alex

Contact this guy. He is probably one of the best writers on this I have ever read. Just register on the site and ask him.
http://www.theamericanview.com/forums/showthread.php?p=972#post972

[Real_CaGeD]

One reason the fair tax is bullshit.

Acountants will never give up their piggy bank.

You must use an acountant for your taxe return, or to keep from being audited. Thus the confusing tax code.

Think about the size and power of the acounting racket.

[murrayrothbard]

with a sales tax you discourage consumption and encourage savings and investment.

But the whole point of savings is to consume more in the future. Each individual has there own value scale and decide for themselves how much to consume and how much to save. It would be an arbitrary value judgement to say that consuming later is necessarily better than consuming now.

Also, food for thought on "consumption taxes":

"One of the oldest problems connected with taxation is: Who pays the tax? It would seem that the answer is clear-cut, since the government knows on whom it levies a tax. The problem, however, is not who pays the tax immediately, but who pays it in the long run, i.e., whether or not the tax can be “shifted” from the immediate taxpayer to somebody else. Shifting occurs if the immediate taxpayer is able to raise his selling price to cover the tax, thus “shifting” the tax to the buyer, or if he is able to lower the buying price of something he buys, thus “shifting” the tax to some other seller.

In addition to this problem of the incidence of taxation, there is the problem of analyzing other economic effects of various types and amounts of taxes.

The first law of incidence can be laid down immediately, and it is a rather radical one: No tax can be shifted forward. In other words, no tax can be shifted from seller to buyer and on to the ultimate consumer. Below, we shall see how this applies specifically to excise and sales taxes, which are commonly thought to be shifted forward. It is generally considered that any tax on production or sales increases the cost of production and therefore is passed on as an increase in price to the consumer. Prices, however, are never determined by costs of production, but rather the reverse is true. The price of a good is determined by its total stock in existence and the demand schedule for it on the market. But the demand schedule is not affected at all by the tax. The selling price is set by any firm at the maximum net revenue point, and any higher price, given the demand schedule, will simply decrease net revenue. A tax, therefore, cannot be passed on to the consumer.

It is true that a tax can be shifted forward, in a sense, if the tax causes the supply of the good to decrease, and therefore the price to rise on the market. This can hardly be called shifting per se, however, for shifting implies that the tax is passed on with little or no trouble to the producer. If some producers must go out of business in order for the tax to be “shifted,” it is hardly shifting in the proper sense but should be placed in the category of other effects of taxation.

A general sales tax is the classic example of a tax on producers that is believed to be shifted forward. The government, let us say, imposes a 20-percent tax on all sales at retail. We shall assume that the tax can be equally well enforced in all branches of sales.[10] To most people, it seems obvious that the business will simply add 20 percent to their selling prices and merely serve as unpaid collection agencies for the government. The problem is hardly that simple, however. In fact, as we have seen, there is no reason whatever to believe that prices can be raised at all. Prices are already at the point of maximum net revenue, the stock has not been decreased, and demand schedules have not changed. Therefore, prices cannot be increased. Furthermore, if we look at the general array of prices, these are determined by the supply of and the demand for money. For the array of prices to rise, there must be an increase in the supply of money, a decrease in the schedule of the demand for money, or both. Yet neither of these alternatives has occurred. The demand for money to hold has not decreased, the supply of goods available for money has not declined, and the supply of money has remained constant. There is no possible way that a general price increase can be obtained.[11]

It should be quite evident that if businesses were able to pass tax increases along to the consumer in the form of higher prices, they would have raised these prices already without waiting for the spur of a tax increase. Businesses do not deliberately peg along at the lowest selling prices they can find. If the state of demand had permitted higher prices, firms would have taken advantage of this fact long before. It might be objected that a sales tax increase is general and therefore that all the firms together can shift the tax. Each firm, however, follows the state of the demand curve for its own product, and none of these demand curves has changed. A tax increase does nothing to make higher prices more profitable.

The myth that a sales tax can be shifted forward is comparable to the myth that a general union-imposed wage increase can be shifted forward to higher prices, thereby “causing inflation.” There is no way that the general array of prices can rise, and the only result of such a wage increase will be mass unemployment.[12]

Many people are misled by the fact that the price the consumer pays must necessarily include the tax. When someone goes to a movie and sees prominently posted the information that the $1.00 admission covers a “price” of 85cents and a tax of 15 cents, he tends to conclude that the tax has simply been added on to the “price.” But $1.00 is the price, not 85cents, the latter sum being the income accruing to the firm after taxes. This income might well have been reduced to allow for payment of taxes.

In fact, this is precisely the effect of a general sales tax. Its immediate impact lowers the gross revenue of firms by the amount of the tax. In the long run, of course, firms cannot pay the tax, for their loss in gross revenue is imputed back to interest income by capitalists and to wages and rents earned by original factors—labor and ground land. A decrease in the gross revenue of retail firms is reflected back to a decreased demand for the products of all the higher-order firms." [Rothbard, MES p1156-9] (http://www.mises.org/rothbard/mes/chap16a.asp#3._Incidence_and_Effects)

[steph3n]

The Fairtax as presented is terrible a family allowance and such, it is total bull.

I just printed up all 74 pages of HR25 today to expose it

[Menthol Patch]

There is no need for an analysis.

The Fair Tax is an abomination just like the income tax!

The only true "fair" tax is ZERO tax!

[Oddball]

Here's all the analysis you need:

1) The oxymoronic "fair tax" keeps funding extra-constitutional programs.

2) It does nothing to CONTROL SPENDING, which is the real problem.

3) It doesn't abolish the IRS, just narrows down the targets for their terror tactics.

4) It sucks ass.

[steph3n]

Contact this guy. He is probably one of the best writers on this I have ever read. Just register on the site and ask him.
http://www.theamericanview.com/forums/showthread.php?p=972#post972

this is who I mentioned to Politcallore in PM :D

[dmspilot00]

Also, food for thought on "consumption taxes":

"One of the oldest problems connected with taxation is: Who pays the tax? It would seem that the answer is clear-cut, since the government knows on whom it levies a tax..."

Let me expand on this, because this is an important point to understand and is one reason the fair tax is not fair at all.

A principle of microeconomics is that it matters not on which party the tax is levied on. No matter where the tax is levied or who collects it, the buyer may have to bear most of the tax burden, the seller may bear most of the tax burden, or the buyer and seller may share tax burden, equally or unequally. A tax can hurt the seller more than the buyer even if it is levied on the buyer only, and vice versa. Who is hurt more by a sales tax depends on demand elasticity.

(Elastic demand means that quantity demanded is very sensitive to small changes in price; inelastic demand means that quantity demanded does not change much even with large changes in price. An example of a good with elastic demand could be yachts, and a good with inelastic demand would be gasoline. If the price of a yacht goes up significantly in a short period of time, people will just not buy any more yachts. If the price of gasoline goes up significantly in a short period of time, the amount of gasoline people buy remains relatively unchanged.)

When you tax a good with a very inelastic demand, such as gasoline as mentioned above, or maybe food or basic clothing, the buyers pay most of the tax burden because they cannot easily change their behavior. The seller will just tack the new tax on to the old price, sell the same amount as they did before, and make the same profit as they did before.

BUT, when you tax a good with a very elastic demand, such as yachts as mentioned above, or maybe jewelry or designer clothes, fancy televisions or expensive electronics, etc., the sellers share most of the tax burden. The sellers must either lower their prices to offset the new tax (thus reducing profit margin by the amount of tax), or the ycan keep the prices the same but sell significantly less quantity. Either way the seller suffers far more than the buyer. This was proven in the 1990s when Bill Clinton tried to impose a sales tax on luxury goods only, and the result was the producers of the luxury goods went out of business.

Mike Huckabee said in one of the debates that a national sales tax won't matter, a tax won't prevent Americans from buying stuff. Well that is ridiculous, a tax ALWAYS reduces demand--in the case of goods with inelastic demand, it reduces quantity demanded a little bit, and in the case of goods with elastic demand, it reduces quantity demanded a lot. Furthermore, most poor people are only buying goods they absolutely need--goods with inelastic demand, while rich people buy goods they don't need and can go without--goods with elastic demand. The result is that not only are poor people hit the hardest, but since our current economy is sustaining itself on excessive consumption of frivilous crap, implementing the "fair tax" would crash the economy.

[Oddball]

Well said!!! :)

[atilla]

But the whole point of savings is to consume more in the future. Each individual has there own value scale and decide for themselves how much to consume and how much to save. It would be an arbitrary value judgement to say that consuming later is necessarily better than consuming now.

Also, food for thought on "consumption taxes":


hey murray,

good to hear from you i thought you were dead. people think i'm dead too, but i found the elixir of eternal life in Tamási. value of consuming now versus later is subjective, but if you want to get wealthy consume later. if you want to be a typical american, consume now and when you lose your job you can watch while the bank reposes your house, suv and bestbuy takes your plasma tv.

actually, the idea of being wealthy in a poor country appeals to me, you know, cheap house servants and gardeners. you just hope the difference doesn't get too great the peons get jealous and revolt. i've even considered moving to another country, but the way this one's going i may just have to hold tight and i'll get my dream right here. and the house servants will speak english, they can tell me all about when they used to drive big SUVs and go out to dinner every night. then they'll be making me dinner.

your friend,

atilla the hun.

[RonPaulLibrary]

In Ron Paul's words:

Many conservatives have touted the Fair Tax proposal as an issue in the upcoming election. A pure consumption tax like the Fair Tax would be better than the current system only if we truly did away with the income tax by repealing the 16th amendment. Otherwise, we could end up with both the income tax and a national sales tax. A consumption tax also provides more transparency and less complexity. But the real issue is total spending by government, not tax reform. In other words, why change the tax structure if spending stays the same? Once we accept that the federal government needs $2.7 trillion from us-- and more each year-- the only question left is from whom it will be collected. Until the federal government is held to its proper constitutionally limited functions, tax reform will remain a mirage.

I apply a very simple test to any proposal to overhaul the tax code: Does it reduce or eliminate an existing tax? If not, then it amounts to nothing more than a political shell game that pits taxpayers against each other in a lobbying scramble to make sure the other guy pays. True tax reform is as simple as cutting or eliminating taxes. No studies, panels, committees, or hearings are needed. When reform proposals seem complicated, they almost certainly don’t cut taxes. Congress should simply focus on cutting existing taxes and reducing spending, instead of complicated overhauls of the system.

Ron Paul, October 16, 2006
http://www.ronpaullibrary.org/document.php?id=482

[Patrick Henry]

this is who I mentioned to Politcallore in PM :D

Nice!hehe :D
Great minds.... :D

[robert4rp08]

The Fair Tax is actually a good thing if you're going to collect a tax.

no