In this final installment of the FAIRTAX series I want to review the content of the series and give a few personal thoughts on our country, our system, and how I see the FAIRTAX being an integral part of the solution to our debt issue, though not the only aspect, and of how we get the United States back on steady financial ground.
As I write this series, our nation owes more than $14 trillion to other nations, mostly Communist China. Our debt ceiling has just been raised to about $17 trillion, money that will surely be spent as fast as government presses can print it. Our overall unfunded liabilities, including Social Security, Medicare, Medicaid, and all of the other unfunded promises run in the neighborhood of $130 trillion depending on which numbers you believe. From watching our esteemed federal government the last 40 years, I tend to lean towards believing the higher numbers, with no foreseeable end in sight to the irresponsible activities of those elected to “govern” us.
It is apparent to me that cutting taxes, changing the tax structure, or confiscating every dollar of We the People will not do all that is necessary to solve our financial woes. We face basically two major problems. One is government spending, a matter I will delve into later. The other problem is taxation. The FAIRTAX is designed to be revenue neutral, which means it won’t destroy government funding as some alarmists would have you believe. On the other hand, the FAIRTAX will not raise the cost of everything you buy by the 30% that the alarmists would also have you believe.
I would much prefer to receive the entire paycheck and decide for myself how it is used. The studies that have been done to show why companies locate overseas have been overwhelming to me. The cost of labor is being driven ever higher by the tax structure, which is a never ending catch-22 situation. The more taxes paid by those doing the hiring the less there is for them to pay We the People for work. The more I have to pay in taxes the more money I need to combat inflation. Every penny collected in taxes makes it more difficult to survive and prosper. Every job shipped overseas due to the tax structure, prohibitive regulation, and government “oversight” makes our nation that much less prosperous and safe.
Those who say “tax the rich more” don’t realize, or don’t care, that the money paid in taxes does not benefit the overall financial situation of the nation. Higher taxes on the “rich” doesn’t make the poor any wealthier, as a matter of fact, it has the opposite effect. A poor person never provided me with any income. If the reverse was true Communism would not fail everywhere it is tried.
I see that out of 500 company CEO’s surveyed, 80% said that under the FAIRTAX they would build their next production facility in the United States, and the other 20% would move their entire operation here. That causes me to believe that those jobs that have gone overseas would be right back here and we would find ourselves in the position of having more jobs than applicants, a good position for the working class people as that would cause wages to rise. This in turn adds to the taxable income available. More jobs mean a broader tax base, more income for the government coffers, and more prosperity for more people.
Under our current system, those who produce legally pay the taxes. Under the FAIRTAX everyone would contribute. Those here illegally and working under the table for cash would contribute. Drug dealers, prostitutes, and tourists would also contribute to the tax structure where they don’t do so now. I can’t find any reason to not like the FAIRTAX system.
The Pre-bate is designed to take into account the cost of taxes on the basic necessities of life. I like the idea of food, medicine, utility costs, and other necessities being tax free, up to the poverty line. Every penny I don’t have to pay to the government in some form of tax is another penny I can spend on my family to make our quality of life better. This part of the FAIRTAX will benefit those at the lower end of the financial spectrum greatly as more money would be available to improve the quality of life for those with less to start with. If I choose to save money instead of spend it I can benefit where under the current system I can only save after the greedy politicians have taken their cut from my hard earned wages.
Today, we find about 45% or so pay no income or employment taxes at all and many of these complain that the 55% who do pay income and employment taxes aren’t paying their “fair share”. I find this rather ironic. Someone who pays nothing complains about someone else is not paying enough, not paying their “fair share”. I wonder how much the “fair share” of those not paying anything would be if the playing field was level. I believe that everyone should pay at least some taxes. We all have a stake in the safety and prosperity of the United States, not just the “rich”. This issue has been used by politicians for my entire life to divide and conquer for their own benefit, not for the benefit of We the People.
Remember, government does not produce wealth; they only take the production of others, filter it through their pockets, and then give it to those they deem deserving, mostly those who are too lazy to work for their keep and know how to game the system for their own benefit. Politicians use tax rates to buy votes. The latest figure I have seen, as of 2009, say that 28 cents of every welfare dollar actually goes to help recipients. The other 72 cents goes to “administrative costs”. I fail to understand how the current system “helps” anyone at all. I would think that a job paying money directly to a wage earner would be a much more efficient way of providing sustenance for people.
As any other decent American, I believe that taking care of those who cannot take care of themselves is the responsibility of all able bodied people. Paying women to have baby after baby to be able to stay on welfare rolls, those faking injuries to draw SSI, and those who are drug addicts and use that as a “disability” to draw SSI are all problems that are not “fair” to those of us working for a living. The FAIRTAX, or any other tax system, will not solve these problems.
I have seen various arguments made against the FAIRTAX. I don’t have the time or space to answer every argument made against this plan but I can say that I have not seen a better plan come out with the specificity of the FAIRTAX. Most of the arguments made at the various places I have posted this series are debunked in the book this series is based on, FAIRTAX: The Truth. The authors devote an entire chapter to covering the misunderstandings, the lies, and the disinformation that has been passed out to defeat this plan.
My intent in this series is to give an overview of the book, and a basic understanding of the plan, not rewrite it here. I can say that 86,000 pages of tax rules and regulations are a bit excessive and should be eliminated. The FAIRTAX does exactly that, and more.
The legislation is H.R. 25 and can be found at the Thomas Congressional Library website. You can look it up by bill number or by name as you wish. I also encourage you to buy the book and get a more in-depth understanding than I can give you. After reading the initial article a friend decided to buy the book and get more details. He e-mailed me that the book, FAIRTAX: The Truth, can be bought on Amazon.com for $3.95. This is the Cliff notes version and is designed to give you as broad and as fair a description as possible with the hopes that all who read my articles will look further and get a more complete understanding of the FAIRTAX and how it is designed to improve the lot of all Americans.
I understand that the FAIRTAX is not the only answer to our nation’s financial ills. Spending by politicians bent on preserving their power and prestige is a huge issue that must be addressed if we are to ultimately solve our nation’s financial problems. A large part of the spending problems stem from the fact that politicians of both parties can demagogue the tax issue, using class warfare to pit one American against another for the benefit of themselves, the political ruling class. The FAIRTAX goes a long way towards ending this practice.
I can assure you that if the FAIRTAX was of great benefit to the ruling class we would already have it in place, not just being bandied about, or more precisely, ignored by the ruling class. The more politicians oppose the plan the more I like it. Many economists and others have spent months coming up with this plan and I believe it is a much better system than we currently use. Nothing will ever be perfect but this comes as close as anything I have heard or read about. It gives We the People more say in how our wages are used.
Tax and spend politicians need to be sent home and people with common sense, and the safety and prosperity of all as their first priority elected to do the job they swear to do when they take office. The self-interest of politicians and the corruption they participate in every day needs to be stopped if we are to survive.
I have read the FAIRTAX book very carefully twice and parts of it more than that. Many people take a quick look at the plan and begin to berate it without truly understanding what it means and how it works. At one time I also looked at the FAIRTAX and thought “so what”!! I began to hear more about this plan, and as I took the time and effort to look into it a little more thoroughly I began to change my opinion about the FAIRTAX. I am convinced that this plan will make great strides in helping our nation come out of the financial doldrums and put us back on the road to prosperity in a hurry. All we have to do is convince the ruling class to put it to work. We do that by letting them know of our support for this plan and our insistence that they act soon.
You are welcome, and encouraged, to share any of these articles with anyone you would like to share with. Information is power and I write these to inform, educate, and motivate people. I hope everyone you know sees these articles.
Again, the legislation is H.R. 25 and can be found at the Thomas Congressional Library web site . The bill is very short and very simple to read. It is up to We the People to make the changes necessary to promote prosperity, not wait on self-serving politicians to do what is best for us. The bill can also be found at this link.
I submit this in the name of the Most Holy Trinity, in faith, with the responsibility given to me by Almighty God to honor His work and not let it die from neglect.
December 27, 2011