Krugman: Death Panels for Elderly Will Solve Debt Crisis

News Max.com ^ | Nov 14, 2010

[KeyLargo]

Krugman: Death Panels for Elderly Will Solve Debt Crisis

In an explosive interview Sunday on ABC's "This Week," liberal economist and New York Times columnist Paul Krugman discussed using "death panels" for the elderly to solve America's huge debt crisis. Though he's bashed conservatives for using the term for years, Krugman now acknowledges that severe health cuts for the aged and infirm now might be the right approach.

[scooby321]

The next death will be your job because the New York Times is going Bankrupt. Paulie we have a GOP House no Bailout.

[ChurtleDawg]

essentially, a VAT and sales tax have the same end result to a consumer. It just changes how the money is collected. In a VAT, parts of the sales tax are collected in stages, with the end result being the VAT added to the price. A Sales tax just tacks the tax on at the end.\

So a $1.00 item will be $1.10 whether there is a 10% VAT or a 10% sales tax

[Uri’el-2012]

So a $1.00 item will be $1.10 whether there is a 10% VAT or a 10% sales tax

A 10% sales tax is 10% ONCE.

A 10% VAT is a 10% tax at every step of development
E.G a product with 5 steps of development at 10% => ~50% tax

[syriacus]

[chris_bdba]

Hey Krugman you know you aren’t a young man so be careful what you wish for because it most likely will be you.

[TexasRepublic]

From the unthinkable to public advocacy. It is shocking that guy hasn’t been strung up already.

[SandRat]

You first Paul!

[ChurtleDawg]

wrong. A VAT only taxes the value added at each stage. It does not tax the total value of the product.

http://en.wikipedia.org/wiki/Value_added_tax

here is how it works:

Without any tax
A widget manufacturer spends $1.00 on raw materials and uses them to make a widget.
The widget is sold wholesale to a widget retailer for $1.20, making a gross margin of $0.20.
The widget retailer then sells the widget to a widget consumer for $1.50, making a gross margin of $0.30.

With a 10% sales tax:-

The manufacturer pays $1.00 for the raw materials, certifying it is not a final consumer.
The manufacturer charges the retailer $1.20, checking that the retailer is not a consumer, leaving the same gross margin of $0.20.
The retailer charges the consumer $1.65 ($1.50 + ($1.50 x 10%)) and pays the government $0.15, leaving the gross margin of $0.30.

With a 10% VAT:

The manufacturer pays $1.10 ($1 + ($1 x 10%)) for the raw materials, and the seller of the raw materials pays the government $0.10.
The manufacturer charges the retailer $1.32 ($1.20 + ($1.20 x 10%)) and pays the government $0.02 ($0.12 minus $0.10), leaving the same gross margin of $0.20. ($1.32 - $0.02 - $1.10 = $0.20)
The retailer charges the consumer $1.65 ($1.50 + ($1.50 x 10%)) and pays the government $0.03 ($0.15 minus $0.12), leaving the same gross margin of $0.30 ($1.65 - $0.03 - $1.32 = $0.30).

[ChurtleDawg]

wrong. A VAT only taxes the value added at each stage. It does not tax the total value of the product.

http://en.wikipedia.org/wiki/Value_added_tax

here is how it works:

Without any tax
A widget manufacturer spends $1.00 on raw materials and uses them to make a widget.
The widget is sold wholesale to a widget retailer for $1.20, making a gross margin of $0.20.
The widget retailer then sells the widget to a widget consumer for $1.50, making a gross margin of $0.30.

With a 10% sales tax:-

The manufacturer pays $1.00 for the raw materials, certifying it is not a final consumer.
The manufacturer charges the retailer $1.20, checking that the retailer is not a consumer, leaving the same gross margin of $0.20.
The retailer charges the consumer $1.65 ($1.50 + ($1.50 x 10%)) and pays the government $0.15, leaving the gross margin of $0.30.

With a 10% VAT:

The manufacturer pays $1.10 ($1 + ($1 x 10%)) for the raw materials, and the seller of the raw materials pays the government $0.10.
The manufacturer charges the retailer $1.32 ($1.20 + ($1.20 x 10%)) and pays the government $0.02 ($0.12 minus $0.10), leaving the same gross margin of $0.20. ($1.32 - $0.02 - $1.10 = $0.20)
The retailer charges the consumer $1.65 ($1.50 + ($1.50 x 10%)) and pays the government $0.03 ($0.15 minus $0.12), leaving the same gross margin of $0.30 ($1.65 - $0.03 - $1.32 = $0.30).

[ChurtleDawg]

I think what you are talking about is a cascading tax system, which what the VAT was designed to avoid-—where the full sales tax cost is passed on and on and on, getting larger.

[truth_seeker]

“A VAT only taxes the value added at each stage. It does not tax the total value of the product.”

In the UK and in Canada, the VAT is on the TOTAL price of the item when sold at retail.

UK rate goes to 20% 1/1/2011

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/BeginnersGuideToTax/VAT/DG_190918

Canada varies by province, ranging from 5% in Alberta to 15% in Nova Scotia.

http://www.tmf-vat.com/international-vat-rates-2010/103-canada-vat-rate.html

So in actual fact, although the term VAT derives from “value added tax” they are sales taxes on the TOTAL price paid.

Letting the camel’s nose under the tent is really risky.

For instance the UK has a 28% tax on capital gains, and high income tax rates as well.

[Uri’el-2012]

I would be reluctant to use wikipedia
as my basis for economic understanding.

[mrsmith]

“Your life is in their hands”

And your gold fillings are in their sights...

[ChurtleDawg]

a value added tax is like a sales tax, only the money is collected differently. In a sales tax the money is collected once, at the retail stage. In a VAT, the value added is taxed at each stage of production. The end result is the same to you, the buyer.

[KeyLargo]

"Please stop referring to Krugman as an ‘economist’. It is obvious that he knows nothing about economics."

Wait! But, but, he got a NO bell prize just like President Obama who knows nothing about being a president.

[Hoodat]

lmao! That sign is hilarious!

[MHGinTN]

And we have skill sets they don’t want to face, believe me!

[KeyLargo]

Oh sh_t, the cat ate my prize!

[GingisK]

Roger that. (sheeeck)

[monkeyshine]

The VAT is a horrible way to tax. It forces the burden of taxation at every level of production, and then requires producers to ask for rebates. The compliance costs are problematic, and it is a horrible burden for small businesses. Government loves it because it allows them to track goods through various stages of production - it is a very controlling form of taxation.

The VAT encourages companies to outsource as much production as possible.