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Want to revitalize economy and make Americans richer? Kill the income tax
Detroit News ^ | 11/17/02 | Nolan Finley

Posted on 11/17/2002 9:11:39 AM PST by jimkress

Edited on 05/07/2004 7:09:08 PM PDT by Jim Robinson. [history]

Intriguing, idea and Washington aren't words that often appear together in a credible sentence. But an intriguing idea is floating around Washington for reforming the way Americans pay for government.

Treasury Secretary Paul O'Neill is quietly exploring a plan to do away with the income tax, that punitive system of taxation adopted in 1913 that spawned an un-American strain of collectivism. The income tax promotes the notion that the first fruits of hard work and enterprise belong to the government, not the individual.


(Excerpt) Read more at detnews.com ...


TOPICS: Business/Economy; Constitution/Conservatism; Culture/Society; Front Page News; Government; News/Current Events; Politics/Elections
KEYWORDS: taxreform
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Amazing! This in a mainstream newspaper!
1 posted on 11/17/2002 9:11:39 AM PST by jimkress
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To: jimkress
Bump.
2 posted on 11/17/2002 9:15:25 AM PST by PatrickHenry
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To: jimkress
Sounds like they are figuring out a better way of shearing us.
3 posted on 11/17/2002 9:15:26 AM PST by steve50
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To: jimkress
Want to revitalize economy and make Americans richer? Kill the income tax

------------------------

The economy will not be revitalized as long as industries are being shipped out of the country hand over fist.

4 posted on 11/17/2002 9:18:39 AM PST by RLK
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Comment #5 Removed by Moderator

To: jimkress
this is a scare story, I think. "looky the radical republicans!" Flat tax long before this, and even that not for a decade.
6 posted on 11/17/2002 9:40:19 AM PST by Anotherpundit
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To: mortsahl
The regressive nature of a Fixed Rate National Sales Tax can be addressed by a Graduated National Sales Tax. Exempt, for example, the first $10,000 of an automobile purchase. After the first $10,000 the tax kicks in at 10% for the next $10,000 of the cost, 20% for the next $10,000, 30% for the next $10,000 and so on.

I can't get excited about a flat tax as it'll keep the IRS in place at its current size and could be easily increased at a later date.

I completely agree, if a National Sales Tax of any sort were adopted, that it would have to be contingent on a permanent end to any form of income tax.

7 posted on 11/17/2002 9:42:35 AM PST by caltrop
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To: mortsahl
A national sales tax will now cause these people to pay tax. All the bleeding hearts will swamp the airwaves with how unfair it is, that the poorest among us have to pay the largest share (tax versus income) and the rich get a huge tax break (so they can use their undeserved reward to keep the masses poor).

This does not appear to be necessarily true: a provision could be negotiated whereby the poorest continue to receive a tax credit.

P.S. It is damaging for credibility when you claim that people are rewarded for not paying a tax: they are not rewarded but assisted, and not because of the nonpayment of tax but because of relative poverty.

8 posted on 11/17/2002 10:33:20 AM PST by TopQuark
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To: RLK
"The economy will not be revitalized as long as industries are being shipped out of the country hand over fist."


A flat tax would stop them from leaving. Taxes and regulation is what they are escaping from.
9 posted on 11/17/2002 10:34:41 AM PST by kennyboy509
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Comment #10 Removed by Moderator

Comment #11 Removed by Moderator

To: jimkress
It places a high price on success, hard work and risk-taking, and seeks to force equalization by confiscating a greater share as incomes rise.

Certainly I agree that someone who works twice as hard as another should be allowed to take home twice as much money.

Likewise, someone who works twice as smart or twice as long should also take home twice as much.

And someone who works twice as long AND twice as smart AND twice as hard should take home eight times as much.

But how does that explain billionaires?

It doesn't.

People become billionaires not because they work any combination of that much smarter or longer or harder.

They become billionaires because they accumulated enough wealth and power to place themselves in a world governed by economic laws different from the majority of people--economic laws that reward the rich with more riches--not in proportion to how hard they work, but in proportion to how much money and power and influence they have.

Next, why should risk-taking be rewarded?

The bigger the risk, the bigger the fool is the person who takes it (unless it only seems a risk to the outsider).

And since such adventures are risky, the majority of people foolish enough to take such a risk will be hurt or destroyed for it; how is it good for a society to urge people to destroy themselves?

And how does rewarding foolishness fit in with rewarding merit? It doesn't.

Further, what's so great about being rich?

Do not most people dream of being rich so that they can live like leeches, without working hard?

I repeat: I've nothing against making more money than the next guy when such competition is in a level playing field.

12 posted on 11/17/2002 10:56:05 AM PST by Age of Reason
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To: mortsahl
And how is it fair that the poor, who live from hand to mouth and must spend all they earn, will have all their earnings taxed, while wealthier people will have the luxury of saving and investing.

And will there also be a sales tax when you buy stocks instead of food?
13 posted on 11/17/2002 10:59:24 AM PST by Age of Reason
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Comment #14 Removed by Moderator

To: jimkress
I'd only suppoort a consumption tax of this kind if a constitutional amendment were passed to implement it in such a way that 1). The income tax would be repealed from the constitution. 2)the rate set in the 'consumption tax' were included in the amendment, which would require a new amendment (and all the associated difficulties) to raise.
15 posted on 11/17/2002 11:09:14 AM PST by zeugma
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To: mortsahl
The system is set up to reward those who do the least. As I said, you are attributing motives incorrectly. The stated reason is the one I mentioned in the previous post.

The earned incomes tax credit is nothing more than redistribution of wealth. It is.

It is also misnamed for the public to swallow it. No it is not: those who do not earn income, do not receive credit.

16 posted on 11/17/2002 11:24:34 AM PST by TopQuark
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To: Age of Reason
You ask why risk taking should be rewarded? Because risk taking results in products beneficial to everyone. While there will be many risks that flop, those risks that produce the new miracle drug, the new medical device, or countless other products that make our lives better are worth it. Without an inducement to take risks, there would be none of these products. Therefore, we should reward risk to enable new inventions to be made.

In regards to your second question about why millionaires should be paid so much more than everyone else, even though they might not work "harder" than some manual labor, you have to think of the responsibilities of these people. First, there are not that many billionaires, so we will stick with millionaires. These people run the businesses that make this country work, and unlike the manual laborer, are personally liable as directors of corporations for things that go wrong. Without some additional financial inducement, no one would be willing to take the immense legal and financial responsibility to run these firms. And besides, there are not all that many people with the skills to do such jobs. Thus, with high demand and low supply, the wages will be high.
17 posted on 11/17/2002 11:34:28 AM PST by mrs9x
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Comment #18 Removed by Moderator

To: mortsahl
I do have a problem with them being rewarded for failure. There is no incentive for them to get beyond the poverty line,

The question of incentives is not a trivial one, and you cannot make it by merely pointing on the existence of the tax credit.

But, I respect your views and opinions. I merely wanted to point out some inaccuracies, that's all.

19 posted on 11/17/2002 11:52:32 AM PST by TopQuark
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To: kennyboy509
A flat tax would stop them from leaving. Taxes and regulation is what they are escaping from.

----------------------------------

Something such as a flat national sales tax would be desirable.

However, let's be honest here. What is being pursued, not escaped from, is a source of cheap or slave labor. Wha is wanted is a series of plantations like the old South where the plantation owners can profit and the incrementally few remaing people with employment can get things cheap while the plantations are moved 10,000 miles away.

20 posted on 11/17/2002 11:56:48 AM PST by RLK
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To: mrs9x
You ask why risk taking should be rewarded? Because risk taking results in products beneficial to everyone. . . . Without an inducement to take risks, there would be none of these products.

How many billions do we pay cops, firemen, and servicemen for the far greater risks they take?

21 posted on 11/17/2002 12:58:40 PM PST by Age of Reason
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To: mortsahl
But a tax on consumption is progressive.
22 posted on 11/17/2002 1:38:28 PM PST by jd777
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To: Age of Reason
Food and energy could be excluded.
23 posted on 11/17/2002 1:39:09 PM PST by jd777
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To: jimkress
As usual, everybody buys into the bogus premise that taxes will go down if the system changes. Wrong. Confiscatory tax rates are a symptom. The disease is a fiat money system based on green toilet paper. So long as Congress can print all of the green toilet paper with pictures of dead presidents on it that it wants, there will be a confiscatory tax, no matter what form it takes. Wake up folks, congress doesn't need to come to you for the money it spends, it sticks your kids with the bill in the form of inflation. Changing the taxing system from one non-constitutional form to another is nothing more than re-arranging the deck chairs on the Titanic so long as we're using green toilet paper for currency.
24 posted on 11/17/2002 1:59:50 PM PST by agitator
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To: RLK
"The economy will not be revitalized as long as industries are being shipped out of the country hand over fist."


What, you didn't understand all those lectures about how it is better to buy cheap goods from overseas than make them here? I am sure there is no need to worry in time of war, when we have to fight China we will just buy our weapons from China, see how simple it all is?
25 posted on 11/17/2002 2:04:29 PM PST by RipSawyer
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To: Age of Reason
Those risks, while there, are not going to lead to some new discovery or invention. In addition, there is a larger supply of people willing and ABLE to do fire work and police work than to run large corporations - all you have to look at is the fact that most fire departments are volunteer, and yet they usually have enough people to do it. For cops, there does not appear to be a shortage at the wages offered, so they are probably placed right in the market.

For CEOs and so forth, there is a lot of training involved. You have to either have an MBA or have a JD degree, and you have to have lots of experience and good business judgment. Risks that benefit everyone - such as producing new products or creating new inventions, benefit everyone, unlike putting out a fire which does not create anything new and really only helps those immediately affected.

Nice try though with the firefighter analogy. I just fail to see why you are so bitter against the capitalist market. There is nothing rigged here. You make it sound like some sort of conspiracy. Go out, get educated, and maybe you too can tap into the wealth.
26 posted on 11/17/2002 2:13:39 PM PST by mrs9x
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To: jimkress
Bump
27 posted on 11/17/2002 2:46:54 PM PST by weikel
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To: RLK
Who is putting these thoughts into your head?

A rising tide floats ALL boats.

The tax and spend demonrats are chasing these businesses out because it is cheaper in other countries.

If the work was performed here, Americans would be making the wages instead of forieners.

Yes I know the wages would be low but so would prices.

Didn't you ever take basic economics!?
28 posted on 11/17/2002 3:18:29 PM PST by kennyboy509
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To: mrs9x
Go out, get educated, and maybe you too can tap into the wealth.

What is wealth and why is it desirable?

29 posted on 11/17/2002 3:26:57 PM PST by Age of Reason
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To: RLK
The economy will not be revitalized as long as industries are being shipped out of the country hand over fist.

The issues are related. Russia has a 13% flat tax these days. China's fiscal burden of government is 2x lower than the United States (and they are pushing for flat tax reform).

30 posted on 11/17/2002 4:04:22 PM PST by AdamSelene235
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To: AdamSelene235
No way goods will be cheaper if you institute both a value added tax AND a sales tax. This is a ridiculous proposal and will never fly.
31 posted on 11/17/2002 4:15:24 PM PST by Tennessean4Bush
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To: AdamSelene235
The issues are related......

---------------

About as closely related as you and I are through Adam and Eve.

32 posted on 11/17/2002 4:20:08 PM PST by RLK
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To: kennyboy509
Didn't you ever take basic economics!?

---------------------

Yes, but unlike some people I lerned more than just empty cliches.

33 posted on 11/17/2002 4:23:24 PM PST by RLK
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To: AdamSelene235
I see many here are confused about just what a Fair Tax really is.
34 posted on 11/17/2002 4:36:57 PM PST by ALS
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To: steve50; *Taxreform
We have found a better way to raise funds for the legitimate functions of government.

It will behoove each of you on this thread who doubt the ability of the NRST to improve the lot of all Americans to visit http://www.salestax.org and http://www.votr.org.

If you have any questions about the National Retail Sales Tax after you digest the information on those web sites, please email me at fdavis@salestax.org or call me, toll free, at 1-877-937-6778, day or night.
35 posted on 11/17/2002 4:40:51 PM PST by Taxman
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To: jimkress
Yup. The NRST is becoming a mainstream idea.

We need you help to make it happen, though.
36 posted on 11/17/2002 4:41:42 PM PST by Taxman
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To: RLK
About as closely related as you and I are through Adam and Eve.

So you don't think over-regulation and a high fiscal burden of government distort the price of labor and goods?

37 posted on 11/17/2002 4:42:50 PM PST by AdamSelene235
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To: RLK
Industry and jobs will return to America just as soon as we replace the income tax with a National Retail Sales Tax.

It is an old poll, but the Princeton Economic Institute surveyed some Japanese firms in the 1990's and asked what would be their reaction to a US NRST.

The response? 80% said they would locate manufacturing facilities in the US and 20% would move their headquarters to the US.

The NRST will cause the US to become the economic sponge of the world.
38 posted on 11/17/2002 4:44:44 PM PST by Taxman
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To: mortsahl
While it is true that the Liberal/Socialist/Marxist Bastard crowd will demogogue the NRST as "Unfair to the poor," there are provisions which will be put into the legislation to render that argument moot.

The final version of the legislation will include, for example, a clause which untaxes essential food, clothing and housing (the necessities of life) for all family units.

And, offering a tax plan that says to each and every American the opportunity to "work, earn, save and invest as much as you want to FRee of the heavy hand of government" rings a hellofalot of chimes.

The American people deserve a 21st Century tax plan -- the failed 19th Century Marxist Progressive Income Tax is not it!

The National Retail Sales Tax is!
39 posted on 11/17/2002 4:54:06 PM PST by Taxman
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To: mortsahl
Then read the legislation -- H.R. 2525 and H.R. 2717 are short, to the point, and easy to read.

Go to http://thomas.loc.gov and read 'em both.

Then let me know what you think.
40 posted on 11/17/2002 5:01:04 PM PST by Taxman
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To: Age of Reason
Then you certainly should support a flat rate National Retail Sales Tax!

Talk about a level playing field, that is exactly what the NRST does -- level the playing field for all players.
41 posted on 11/17/2002 5:02:43 PM PST by Taxman
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To: Taxman
The American people deserve a 21st Century tax plan -- the failed 19th Century Marxist Progressive Income Tax is not it!

If an NRST is to be instituted, it must be accompanied by the concurrent repeal of the 16th Amendment, the "Income Tax" Amendment! To do otherwise would only subject us to the re-establishment of this cruel and unusual tax at a later date when the politicians think they can get away with it - and they will if they can. Then, we'll be stuck with the worst of two worlds!

42 posted on 11/17/2002 5:03:09 PM PST by Gritty
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To: Age of Reason
Everyone will have the FReedom to work, save and invest.

You insult every lower income American when you suggest that they do not have the ability to save. They have the ability, just not the incentive.

Why save when it is taxed away from you? Why save when it disqualifies you for government benefits?

Under the system the Liberal/Socialist/Marxist Bastard crowd have constructed, there is no incentive to save -- it is taxed and/or disqualifies people for "benefits!"

Under the NRST, every man, woman and child in America will have an incentive to (and will) save some of their earnings because they will not be penalized for doing so.

Let me tell you a story about a poor Georgia dirt farmer I once knew. In the 1940's, 50's and 60's this poor GA dirt farmer would from time to time sell a calf at the local livestock auction. He'd put 10% of what he got in his savings account at the local bank. Whenever he sold his crops or got paid for his milk or chickens or the eggs he sold, he put 10% of the gross in his savings account.

Just about every GA dirt farmer he knew did the same thing -- it was their "nest egg," to be used in an emergency, to invest in more land, etc.

You get the picture. My Grandfather saved 10% of every nickle he ever earned, and over time, became moderately wealthy. But he never had an indoor bathroom in his house until 1954.

I believe that President Johnson, as part of his "Great Society" scheme, is responsible for the fact that interest earned on a pass book savings account is taxable.

A great irony, isn't it, that a "Populist President" would preside over a regime that took the incentive out of Americans saving for an emergency or an opportunity.

The NRST will restore that incentive, and I believe that every American will respond by saving just a little more than they save today. And that will be a good thing.
43 posted on 11/17/2002 5:19:08 PM PST by Taxman
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To: Tennessean4Bush
A properly constructed consumption tax will result in lower costs for all businesses in the United States.

The income tax system is far more costly to our economy than any person in government is ever likely to admit, because if they did admit to the real cost, the system would crash, immediately.

HST, the real economic cost to our economy for each dollar of taxes raised is about 65 cents. And that figure is an old one, dating from the 1993 book written by James L. Payne; "Costly Returns. The Burdens of the U.S. Tax System" (San Francisco, ICS Press, 1993).

The real cost today may be as much as $1.00 for each dollar raised in federal taxes. Who knows? You can bet that the U.S. Government is not going to tell us!

The NRST lowers the compliance cost of the tax system to ZERO for an individual, for example. And lowers corporate compliance cost by about 90%. Not to mention eliminating the IRS ($17 billion dollars) and the tax courts (no estimate available).

Just for starters.
44 posted on 11/17/2002 5:37:17 PM PST by Taxman
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To: Taxman
Hip Hip Hooray!

Glad to see a knowledgeable tax reformer on Freeper. You might also look at the business section postings.

I have championed income tax as the solution to the current economic woes there. How do you get things going in the right direction, not more Gov. spending, not lower Fed rates, not lower interest rates, not more consumer credit, no more worthless (has to be repaid) cosumer credit but eliminate taxes.

I actually proposed a 30 to 180 day moritorium of income taxes in order to get REAL (not have to be repaid) cash into comumers hands as the solution to the economy and the stock markets. Simple concluding question was is $1000 more in credit or $1000 in a bank account more apt to spur the consumer to buy. Any other solution (Greasspan's) has grave deliterious results to the dollar and trade balances.
45 posted on 11/17/2002 5:41:54 PM PST by imawit
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To: Gritty
I agree. Rep. Sam Johson, (R-3-TX) has repeatedly introduced H. J. RES. 45 to do just that.

Both H.R. 2525 and H.R. 2717 call for repeal of the 16th.

46 posted on 11/17/2002 5:47:10 PM PST by Taxman
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To: imawit
Hope you will join with us at http://www.salestax.org and http://www.votr.org and help us get this done!
47 posted on 11/17/2002 5:49:18 PM PST by Taxman
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To: TopQuark
This does not appear to be necessarily true: a provision could be negotiated whereby the poorest continue to receive a tax credit.

You miss the whole point. This would perpetuate the existing system, where people vote for whoever is going to give them the best deal.

The idea is to exempt certain items, like food and medicine, not certain income levels. If you exempt certain necessities then it puts everyone on an equal footing from the start. This would make it almost impossible to buy influence with the voters. This is another reason why it's not gonna happen in our lifetime.

48 posted on 11/17/2002 5:49:19 PM PST by webstersII
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To: agitator
Go agitate somewhere else -- start your own thread.

There is no question that fiat money is a huge problem, but fiat money and the tax system are two different problems.

If you care to comment on fundamental tax reform, and have something positive to say or a legitimate question to ask about the consumption tax, please do so. But don't waste band width, please, with off-topic stuff.
49 posted on 11/17/2002 5:52:28 PM PST by Taxman
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To: webstersII
LOL! Remember, we outnumber them. All we have to do is find each other, join together, and their jig is up.

That is what we are doing, BTW. More and more credible people are calling for an end to this horrible tax system we have.

Won't be long now, and the hated income tax and the IRS will be tossed on the dustbin of history.
50 posted on 11/17/2002 5:55:47 PM PST by Taxman
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