In 1994, I came across something called The Contract With America. I read it. I listened to what Republicans were saying. And for the very first time in my entire life, I said, "Okay, guys, deal. I'll vote for you if you try to do this." As a lifelong Democrat who'd walked out of the party because of their cruel and selfish policies on taxation and their vile policies on race relations and school choice, I was pretty fed up with them. But I still hated Republicans. But this looked good, so, why not? I did not consider myself a Republican -- still don't, really -- but this was exactly what I was looking for. My attitude: "Tell me what you'll do, make me some promises, and if I like most of the agenda, I'll give you a shot."
I watched in utter horror as small public relations missteps were blown into unbelievable catastrophes by an incredibly hostile press. I watched as so-called "liberals" referred to the Contract as if it were, quite literally, a NAZI agenda. I watched most in the mainstream press over the next few years declare it "dead on arrival" and "a disaster." I also watched as President Clinton signed every portion of it put under his nose. Depending on how you count, between 70 and 90% of that Contract is now the law we live under.
Most impressively, every single promise made in that Contract was kept. All of them, without exception. It was simply breathtaking. It was the first time in my life I had solid proof: politicians really will do what they promise to do!
To this day, the Contract With America is my political litmus test: if you think the Contract With America was (a) a failure, (b) was stopped by Bill Clinton, (c) made the country a worse place, or (d) was massively unpopular, you get an instant "F" from me. I assume you are, at best, a profoundly ignorant person with no opinion worth paying attention to. Or you're a closed-minded, reactionary partisan hack who is incapable of giving credit where it's due.
Or, you're just a low-grade moron who shouldn't play with grown-up scissors. In any case, it's one of those three. There are no other options that I can see.
That Contract was, quite simply, the single most successful legislative agenda of my lifetime. It was the most broad and sweeping and influential legislative agenda since the one Franklin Roosevelt enacted during his first 100 days in office in the 1930s. Those who believe Newt Gingrich will fade into obscurity are simply indulging in wishful thinking; whether you like this man or not, he was the 20th Century's Henry Clay, and no one who studies the history of the late 20th Century in America will be able to ignore his impact.
In today's Wall Street Journal, Gingrich lays out a simple domestic agenda for the next two years for Bush, Frist, Hastert, and the rest of the Congress. Foolish people will snort at this, and act as if the simple fact of Gingrich proposing it means Republicans should ignore it. But those are the closed-minded reactionary silly-heads who still claim the Contract itself was a failure. Such fools should be ignored out-of-hand.
In short, I think Gingrich has described the right agenda. If Republicans use this--along with reasonable moderation on the abortion issue--as their guidebook, I suspect they can count on holding the Presidency and a governing majority for another generation.
Of course, Democrats could try to steal parts of this agenda. That's what Clinton did during much of his Presidency, and to very good effect. So, why not? The country would benefit either way. So my question is, who will be smart enough to snap this stuff up?
Dean:
You said:
Depending on how you count, between 70 and 90% of that Contract is now the law we live under.
That got me thinking. Other than welfare reform, I couldn't actually recall what specific legislation was signed by the President that had its origin in the Contract.
So could you do me a favor please? Just to refresh my memory, please summarize the relevant legislation that came from the Contract that was signed into law.
Here is the Contract in handy checklist format:
1. THE FISCAL RESPONSIBILITY ACT: A balanced budget/tax limitation amendment and a legislative line-item veto to restore fiscal responsibility to an out- of-control Congress, requiring them to live under the same budget constraints as families and businesses.
What bill was signed into law by the President?
2. THE TAKING BACK OUR STREETS ACT: An anti-crime package including stronger truth-in- sentencing, "good faith" exclusionary rule exemptions, effective death penalty provisions, and cuts in social spending from this summer's "crime" bill to fund prison construction and additional law enforcement to keep people secure in their neighborhoods and kids safe in their schools.
What bill was signed into law by the President?
3. THE PERSONAL RESPONSIBILITY ACT: Discourage illegitimacy and teen pregnancy by prohibiting welfare to minor mothers and denying increased AFDC for additional children while on welfare, cut spending for welfare programs, and enact a tough two-years-and-out provision with work requirements to promote individual responsibility.
What bill was signed into law by the President?
4. THE FAMILY REINFORCEMENT ACT: Child support enforcement, tax incentives for adoption, strengthening rights of parents in their children's education, stronger child pornography laws, and an elderly dependent care tax credit to reinforce the central role of families in American society.
What bill was signed into law by the President?
5. THE AMERICAN DREAM RESTORATION ACT: A $500 per child tax credit, begin repeal of the marriage tax penalty, and creation of American Dream Savings Accounts to provide middle class tax relief.
What bill was signed into law by the President?
6. THE NATIONAL SECURITY RESTORATION ACT: No U.S. troops under U.N. command and restoration of the essential parts of our national security funding to strengthen our national defense and maintain our credibility around the world.
What bill was signed into law by the President?
7. THE SENIOR CITIZENS FAIRNESS ACT: Raise the Social Security earnings limit which currently forces seniors out of the work force, repeal the 1993 tax hikes on Social Security benefits and provide tax incentives for private long-term care insurance to let Older Americans keep more of what they have earned over the years.
What bill was signed into law by the President?
8. THE JOB CREATION AND WAGE ENHANCEMENT ACT: Small business incentives, capital gains cut and indexation, neutral cost recovery, risk assessment/cost-benefit analysis, strengthening the Regulatory Flexibility Act and unfunded mandate reform to create jobs and raise worker wages.
What bill was signed into law by the President?
9. THE COMMON SENSE LEGAL REFORM ACT: "Loser pays" laws, reasonable limits on punitive damages and reform of product liability laws to stem the endless tide of litigation.
What bill was signed into law by the President?
10. THE CITIZEN LEGISLATURE ACT: A first-ever vote on term limits to replace career politicians with citizen legislators.
What bill was signed into law by the President?
I just read Newt's "Wish List".
My first impression was this: "What happened to a balanced budget?"
C'mon! It was good enough for item #1 in the Contract, but it is altogether missing from Newt's wish list this time around.
Remember this?
You and I as individuals can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we are not bound by that same limitation?”
— Ronald Reagan’s first inaugural address, 1981 How did that morph into this?:
Glenn Hubbard, chairman of the White House’s Council of Economic Advisers … derides the ‘current fixation’ with budget deficits, and labels as ‘nonsense’ and ‘Rubinomics,’ the view espoused by former Clinton Treasury Secretary Robert Rubin that higher deficits lead to lower growth.”
— The Wall Street Journal, Dec. 17, 2002What happened?
Here's my take on it: Given a choice, the GOP would rather have lower taxes than lower deficits.
Correct me if I'm wrong, but the conventional wisdom is that if you lower taxes far enough, the growth in the economy will supply more than enough tax revenue to fill in the deficits predicted by the static scoring model.
That's borne out by the aptly-named Laffer Curve theory of taxation.
So, using that as a given, here's what we do:
Cut taxes to zero and borrow the entire cost of running the government.
What do you say? I'm game if you are.
As of 1996. 60% of the Contract passed and was signed by Clinton into law. Many other things passed later. Here's a list of what passed only 2 short years after the Republicans took over. I also include the things that good ol' Bill veto'd.
CONTRACT MEASURES SIGNED INTO LAW
Congressional Accountability Act--Applies civil rights and job protection laws to Congress. (H.R. 1)
Congressional Reforms--Host of `opening day' reforms approved as part of House rules, including a one-third cut in committee staff (saving $45 million), term limits for the Speaker and committee chairmen, a ban on committee proxy voting, a three-fifths vote requirement for tax increases, public and media access to committee meetings, and authorization for an audit of the House books.
Line-Item Veto--Gives the President line-item veto authority beginning January 1, 1997 to eliminate wasteful discretionary spending, targeted tax benefits, and new or increased entitlement programs. (H.R. 3136)
Mandatory Victim Restitution--Requires federal judges to order convicted criminals to pay restitution to their crime victims. (S. 735)
Effective Death Penalty Enforcement--Places reasonable limits on appeals filed by violent criminals seeking to overturn their convictions. (S. 735)
Criminal Alien Deportation--Improves current laws to make it easier for the government to deport criminal aliens. (S. 735)
Truth-In-Sentencing State Prison Grants--More than $400 million provided in FY '96 to help states build prisons, provided violent criminals serve at least 85 percent of their sentences. (H.R. 3019)
Local Government Law Enforcement Block Grants--$503 million provided in FY '96 to give local law enforcement officials greater flexibility in fighting violent crime in their communities. (H.R. 3019)
Sexual Crimes Against Children Prevention Act--Instructs the U.S. Sentencing Commission to increase the recommended penalties for making or trafficking in child pornography. (H.R. 1240)
National Security Revitalization--The FY '96 defense appropriations bill reversed Clinton's `hollow' military by restoring $7 billion in Clinton defense cuts and providing an additional $600 million for anti-missile defenses . (H.R. 2126)
Unfunded Mandates Reform--Ends intrusive federal mandates that require local governments (i.e., taxpayers) to pick up the costs. (H.R. 5)
Paperwork Reduction Act--Reduces federal reporting requirements by 40 percent over six years. (H.R. 830)
Regulatory Flexibility Act Amendments--Provides judicial review of the Regulatory Flexibility Act and allows expedited congressional review of new regulations costing more than $100 million. (H.R. 3136)
Small Business Tax Relief--Increases equipment expensing from $17,500 to $25,000 and clarifies the tax treatment of home office/product-sample storage costs. (H.R. 3448)
Securities Litigation Reform Act--Prevents class-action lawyers from abusing the rules to extort settlements from innocent companies whose predictions of corporate performance are not fulfilled. (H.R. 1058)
Personal Responsibility and Work Opportunity Act--Requires welfare recipients to work within 2 years or lose benefits, limits lifetime cash welfare to 5 years, gives states tools for reducing out-of-wedlock births, reforms the fast-growing food stamp program, and ends most welfare to non-citizens. (H.R. 3734)
Drug Abusers Collecting Welfare--Ends SSI payments to drug and alcohol abusers. (H.R. 3136)
Adoption Tax Credit--Allows up to a $5,000 tax credit to offset adoption expenses for families with adjusted gross incomes of less than $75,000 and prohibits adoption agencies from making placements based on race. (H.R. 3448)
Spousal IRAs--Increases from $250 to $2,000 the amount non-working spouses can contribute to IRAs. (H.R. 3448)
Social Security Earnings Limit--Phases in an increase of the earnings limit to $30,000 in 2002 for seniors who choose to work between ages 65 to 69. (H.R. 3136)
Long-Term Care Tax Incentives--Encourages more people to buy long-term care insurance and allows chronically or terminally ill individuals to receive life insurance benefits before death without a tax penalty. (H.R. 3103)
Housing for Older Person Act--Protects senior citizen communities from discrimination lawsuits by defining in law `senior-only' housing complexes. (H.R. 660)
[Page: H11401]
CONTRACT MEASURES VETOED BY THE PRESIDENT
A Balanced Budget by 2002--The balanced budget amendment included in the Contract required a balanced budget in 2002. Falling short by one vote in the Senate, Congress approved the Balanced Budget Act to balance the budget in 7 years. (Vetoed 12/6/95)
Family Tax Cuts--$500 per-child tax cut, marriage penalty relief, $1,000 eldercare deduction, and American Dream Savings Accounts. (Vetoed 12/6/95)
Economic Growth Tax Cuts--Reductions in capital gains and inheritance taxes, among others. (Vetoed 12/6/95)
Lawsuit Abuse Reform--Reforms product liability laws to lower litigation costs to employers and end abuses by trial lawyers. (Vetoed 5/2/96)
Ballistic Missile Defense --Protects America's cities from accidental or terrorist nuclear attack (Vetoed 12/28/95)
U.N. Command of U.S. Troops--Prohibits the president from placing U.S. troops under foreign command. (Vetoed 12/28/95)
Rose's enumeration doesn't count things which did not need to be passed into law. For example, committee staffs were cut exactly as promised--this did not require the passage of a law. Term limits on committee chairmanships were also passed, and remain in effect. A few other items passed in the years from 1996 to 2000, I'll see what I can do about the items since.
As for the balanced budget: you're right, Republicans have abandoned that.
However, you're changing the subject bringing up Laffer. As it happens, it is not even debatable: the Laffer Curve is a simple factual description of reality.
What's funniest about the Laffer Curve is that Arthur Laffer himself will tell you he was not the first to describe the curve, that indeed, every economics text book from Keynes on acknowledges it.
If you want to understand the curve, it's simple:
A) How much revenue does the government bring in if taxation is 0%? Answer: 0.
B) How much revenue does the government bring in if taxation is 100%? Answer: almost 0, because almost no one will work and almost everyone will evade.
The simple reality--and it is reality, not a theory--is that the heavier you tax, the more you give a disincentive for productivity and the more incentive you give for evasion. And at a certain point, higher taxes will result in less tax revenues than lower ones.
Which, by the way, is also a proven fact, and not debateable. Indeed, if you cannot acknowledge that this is a proven fact, then you fall into one of my three categories again: ignorant, reactionary, or stupid. Because if you deny it, you're denying a fact just as solid as the fact that men landed on the moon in the late 1960s.
Questions of tax policy need to be based on what is going to give you the best combination of growth, incentive, and revenue. Politicians who cannot bring the debate to that level are destructive and dangerous people. Voters who cannot bring the question to that level are a threat to themselves and the rest of the nation's well-being.
But by the way: there is absolutely, positively, NO reason why this should be a "conservative" or "Republican" issue. Indeed, many Democrats in the past have openly acknowledged all of the above truths. Why can't the current party?
For that matter, why can't you?
Rose:
Could you do me a favor? I'm having a lot of trouble tracking the bills mentioned above with the 10 items in the Contract. With all due respect, milady, your post is a bit of a document dump; my, er, eyes are glazing over.
If it wouldn't be too much trouble, could you please correlate the bills with the items on the Contract? Thanks. Same goes for vetos. Thanks again.
Dean:
Allow me to explain my crack about the "aptly-named Laffer Curve."
First of all, I agree that Laffer's curve is theoretically valid. Nothing I said should obscure that fact.
But I'd like us to get past the theoretical and move on to the concrete.
For example, you (and others) have said:
The simple reality...is that the heavier you tax, the more you give a disincentive for productivity and the more incentive you give for evasion. And at a certain point, higher taxes will result in less tax revenues than lower ones.
So what? This is all so painfully obvious that it makes my feet itch. The Laffer Curve has been around for at least 25 years that I can remember; in that time, has anyone actually implemented its theory?
You would think that after all these years we would have gotten solid empirical evidence of the curve's "tipping point."
...at a certain point, higher taxes will result in less tax revenues than lower ones.
Where is that "certain point?" Where is that "tipping point?"
A top-bracket marginal rate of 20%? 25%? 30% 35%? Higher? Lower? Where?
How come we don't know where it is after all these years?
It should be pretty cut-and-dried. Plug in the numbers, draw the curve, set the policy.
But no.
Here's why:
Politicians of all persuasions have no use for the theoretical economist's answer. The want the practical politician's answer.
Here's what this means:
First of all, let's stipulate that tax and spend Democrats are hopeless. They don't see the curve for what it is. To them, it's all linear. Forget them, OK?
On the other hand, the "new, improved" Dems (who "get" Laffer) generally think that we're to the left of the tipping point and we still have room to "move forward", i.e., raise taxes. It pleases their constituencies.
The mainstream GOP (who loved Laffer from the very beginning) generally thinks we're to the right of the tipping point and we should "back up", i.e., lower taxes. It makes sense to argue this, given their constituencies.
They both agree (in theory) that there IS a tipping point, but no one agrees where it is.
I'd like to know if you have any idea where that tipping point is.
Hey, Ara, I'd like to know if YOU have any idea where the tipping point is??
"It should be pretty cut-and-dried. Plug in the numbers, draw the curve, set the policy."
That has to be the most asinine remark I've heard from you. Mind you, you are generally a pretty intelligent fellow, but the above remark leaves me breathless.
Plug the numbers into WHAT, Ara?? Give me a model. Give me a function. Hand me a formula!!
Your flippant remark completely ignores the question you raised, which is: where is the tipping point?
The best you can do is to specifically mention the 'top-bracket marginal rate' and throw out some percentages.
Ok, Ara, just which factors have an effect on the Laffer Curve? And what is their weight? Please specify your assumptions, and define your terms. I would appreciate a particular formula, if you would be so kind...
You know, I've had tons of modeling theory stuffed down my throat. I've had to study the differences between stochastic and determinstic systems, inventory theory, economics, and optimizing systems of linear equations. But you (from your tone) seem already to have an answer to all of our problems. Could you, perhaps, share it with the rest of us?
By the way, you earlier mentioned deficits, and asked what happened to them: it's simple: Islamofacism happened...
Casey-my-good-friend:
a.) Chill. Out. Please read my post again.
I am merely giving the Laffer Curve the benefit of the doubt.
You are voicing some of the very same concerns that I have; however, I am willing to hear advocates of the Curve justify it's long-term utility. You should too.
But only if they can "concretize" the theory by nailing the tipping point.
Sorry if that was not clear to you.
b.) re: the rise of Islamofacism -- Reagan decried deficits during the Cold War. Was that not a situation as fraught with peril as this? Yet he thought "deficits as far as the eye could see" were, shall we say, "unhealthy."
See here's the thing: You will find no more staunch an advocate of the Bush Doctrine than me. And that includes advocacy of ALL the budgetary discipline necessary to back up the Bush Doctrine with real action.
However, in my opinion, that does NOT mean that we have the ability borrow and spend our way to victory against Islamofacism (a buzzword that I dislike). Yeah, we did it against the Soviets; but this time the enemy is different. For one thing it's largely stateless (Axis of evil notwithstanding).
I have an open mind on this, so here's my request:
Can someone (preferably a Reaganite conservative) please provide me with a well-thought out rationale for why deficits don't matter now versus why they mattered in 1976-80.
For those of you who don't remember the late 1970's, think of Leonid Brezhnev, Poland, Lech Walensa, Pope John Paul II, Afghanistan, Jimmy Carter, Iran hostages, etc.
Remember:
1976-80 : deficits bad.
Then 1980-88, deficits were neutral. Then 1990, raising taxes was "good" (at least the President thought it was necessary. Something to do with deficits?)
Then the elections of 1992 gave the President a mandate for deficit reduction. [Something to do with 19 million people who voted for Ross Perot.]
Come 1998-2000, deficits finally came down.
Now deficits are back, but this time they're good.
1976: deficitsbad
2002: deficitsgood
Was the GOP wrong then, or are they wrong now?
>>A) How much revenue does the government bring in if taxation is 0%? Answer: 0.
>> B) How much revenue does the government bring in if taxation is 100%? Answer: almost 0, because almost no one will work and almost everyone will evade.
Dean,
The real tax rate is not the only component in taxation. You must also calculate WHAT to tax and relatedly, HOW you will collect it. I personally believe we will all be better off with a 0% marginal corporate tax rate. I also believe for a myriad of administrative, social and economic reasons we will be much better off with a 0% marginal income tax rate. This involves not merely a realignment of tax policy; this is actual fundamental tax reform.
Ending corporate taxes is a good idea. Anybody who knows anything about taxation realizes businesses do not really pay taxes. They simply pass their taxes along in the price of the finished product or service. In addition, this punitive policy of taxing the rich to make sure “the rich pay their fair share” is simply Democrat code for social engineering. Democrats, and liberal Republicans for that matter, are in the business of choosing whom the winners and losers are in society. That is not why government exists.
This power also gives politicians excessive control over private businesses and individuals. You might change your mind after suffering an IRS audit if you do not believe me.
The IRS audited my retired parents five years after my mother retired. I am not sure what they were looking for; but the IRS agent thought they had some money buried in the back yard! I also remember Congressman John Linder mention one fellow Georgian who had the IRS going through his trash with handguns drawn one Friday morning in 1998! This is not what our founding fathers envisioned for a free society. We deserve better as the leading industrial society in the world.
Using the class warfare argument pitting American against fellow American is a favorite tactic used by Democrats for decades. This was not the original intention of politicians who passed the Income Tax in 1912; but it is one major goal of theirs today. Democrats currently play this out when decrying tax cuts for the rich and not for he middle class or underclass, etc. Republicans are for cutting marginal tax rates for the top American taxpayers since they are the ones paying the majority of taxes. Democrats demagogue this issue blaming Republicans for favoring “big business” or the “wealthy” while totally ignoring that the wealthy already pay the majority of income taxes (90%). I guess that is still not enough. They also ignore the fact that “rich” people are the ones who employ “unrich” people i.e., Democrats. Democrats also ignore the reality that small business creation is the real object of Republican tax cut proposals. Small businesses employ more people than all the “big businesses” combined. Ergo, it is inscrutably wise to create small businesses if you want to create more jobs. You can also “afford” to create more small businesses with lower marginal rates than with higher marginal rates. You never meet anybody with a 0% marginal tax rate ever hire anybody.
Democrats are not concerned with any of this. They are not concerned with any ideas for effectively stimulating our ailing economy, either. Democrats are simply interested in appealing to their base using the tax issue as part of a divide and conquer strategy. This will never end with the Income Tax.
True fundamental tax reform will end all this class warfare junk. I propose adopting a consumption tax to collect all federal tax revenue. You will never again be audited. Politicians will never again use the tax code for social engineering. Manipulating the tax code to pit American against American will end. Administering a consumption tax will cost a fraction of administering the Income Tax code, currently $8 billion yearly. Compliance costs associated with the Income Tax are $250 billion yearly. This is a conservative figure.
I for one am tired of the unfair way our Income Tax is written and administered. It is excessively complex. Albert Einstein even said, “The most difficult thing to understand in the entire universe is the Income Tax.” If you want to learn more about this idea visit http://www.fairtax.org. Together we can make April 15th just another day.
>>The simple reality--and it is reality, not a theory--is that the heavier you tax, the more you give a disincentive for productivity and the more incentive you give for evasion. And at a certain point, higher taxes will result in less tax revenues than lower ones.
Dean,
Interesting you should mention this. What you say is most undoubtedly true. There was a stretch in the 60’s and 70’s when Democrats RAISED the marginal tax rate on capital gains seventeen consecutive years in a row. These tax increases resulted in seventeen consecutive years of DECREASED revenue from capital gains taxes. You would think Democrats would have figured this out in less than seventeen years. But then alas, along came Ronald Reagan and the rest is history. Fundamental tax reform though, is still more powerful and more permanent than a simple tax cut.
Sorry, Ara. It's been a rough 3 weeks. I think I'll lay off posting late at night when I'm tired. Heh.
Yes, unless they can come up with specific formulae it's about as useful as other common sense observations like "if you don't stop picking at it, it'll never heal".
Actually I'm not sure that the Republicans "like" them now. Yes, perhaps certain individuals have tried to excuse them in terms of the "War on Terror" (and that's a phrase that bugs me, heh), but does the GOP as a party stand in favor of them now? I'm not saying they are or they aren't, but I haven't heard much about it "officially".
Me, I think we can support the military and balance the budget too. The "only" thing it takes is killing a couple of sacred cows. Heh.
Oh, and getting US troops out of areas where they don't belong like Korea and Bosnia...
Kevin, if I understand you correctly, you are suggesting some sort of national sales tax with your consumption tax, yes?
BAD idea. Look to see how much VAR taxes are hurting Europe. Not to mention that this would hurt sales (might be a good way to encourage saving, by accident [g]). Not to mention the math is all screwy. Suppose someone pays $3,000 a year in Federal taxes. She would, at 5%, have to spend $60,000 to generate $3,000. And that's forgetting local sales taxes.
Also, this scheme hits poor people harder. When you only make (say) $200 a week any sales tax hurts. When you make $2,000 a week you have more margin. Oh, will staple items like food be taxed? Whoopsie, an exemption already!
Ara:
(Insert sarcastic remark here), I hope this is better...
I also included the first 8 items since they were delivered on, as well.
FIRST, require all laws that apply to the rest of the country also apply equally to the Congress;
SECOND, select a major, independent auditing firm to conduct a comprehensive audit of Congress for waste, fraud or abuse;
THIRD, cut the number of House committees, and cut committee staff by one-third;
FOURTH, limit the terms of all committee chairs;
FIFTH, ban the casting of proxy votes in committee;
SIXTH, require committee meetings to be open to the public;
SEVENTH, require a three-fifths majority vote to pass a tax increase;
EIGHTH, guarantee an honest accounting of our Federal Budget by implementing zero base-line budgeting.
Congressional Reforms--Host of `opening day' reforms approved as part of House rules, including a one-third cut in committee staff (saving $45 million), term limits for the Speaker and committee chairmen, a ban on committee proxy voting, a three-fifths vote requirement for tax increases, public and media access to committee meetings, and authorization for an audit of the House books.
1. THE FISCAL RESPONSIBILITY ACT: A balanced budget/tax limitation amendment and a legislative line-item veto to restore fiscal responsibility to an out- of-control Congress, requiring them to live under the same budget constraints as families and businesses.
What bill was signed into law by the President?
A Balanced Budget by 2002--The balanced budget amendment included in the Contract required a balanced budget in 2002. Falling short by one vote in the Senate, Congress approved the Balanced Budget Act to balance the budget in 7 years. (Vetoed 12/6/95)
Line-Item Veto--Gives the President line-item veto authority beginning January 1, 1997 to eliminate wasteful discretionary spending, targeted tax benefits, and new or increased entitlement programs. (H.R. 3136)
2. THE TAKING BACK OUR STREETS ACT: An anti-crime package including stronger truth-in- sentencing, "good faith" exclusionary rule exemptions, effective death penalty provisions, and cuts in social spending from this summer's "crime" bill to fund prison construction and additional law enforcement to keep people secure in their neighborhoods and kids safe in their schools.
What bill was signed into law by the President?
Mandatory Victim Restitution--Requires federal judges to order convicted criminals to pay restitution to their crime victims. (S. 735)
Effective Death Penalty Enforcement--Places reasonable limits on appeals filed by violent criminals seeking to overturn their convictions. (S. 735)
Criminal Alien Deportation--Improves current laws to make it easier for the government to deport criminal aliens. (S. 735)
Truth-In-Sentencing State Prison Grants--More than $400 million provided in FY '96 to help states build prisons, provided violent criminals serve at least 85 percent of their sentences. (H.R. 3019)
Local Government Law Enforcement Block Grants--$503 million provided in FY '96 to give local law enforcement officials greater flexibility in fighting violent crime in their communities. (H.R. 3019)
3. THE PERSONAL RESPONSIBILITY ACT: Discourage illegitimacy and teen pregnancy by prohibiting welfare to minor mothers and denying increased AFDC for additional children while on welfare, cut spending for welfare programs, and enact a tough two-years-and-out provision with work requirements to promote individual responsibility.
What bill was signed into law by the President?
Personal Responsibility and Work Opportunity Act--Requires welfare recipients to work within 2 years or lose benefits, limits lifetime cash welfare to 5 years, gives states tools for reducing out-of-wedlock births, reforms the fast-growing food stamp program, and ends most welfare to non-citizens. (H.R. 3734)
Drug Abusers Collecting Welfare--Ends SSI payments to drug and alcohol abusers. (H.R. 3136)
4. THE FAMILY REINFORCEMENT ACT: Child support enforcement, tax incentives for adoption, strengthening rights of parents in their children's education, stronger child pornography laws, and an elderly dependent care tax credit to reinforce the central role of families in American society.
What bill was signed into law by the President?
Adoption Tax Credit--Allows up to a $5,000 tax credit to offset adoption expenses for families with adjusted gross incomes of less than $75,000 and prohibits adoption agencies from making placements based on race. (H.R. 3448)
Long-Term Care Tax Incentives--Encourages more people to buy long-term care insurance and allows chronically or terminally ill individuals to receive life insurance benefits before death without a tax penalty. (H.R. 3103)
Sexual Crimes Against Children Prevention Act--Instructs the U.S. Sentencing Commission to increase the recommended penalties for making or trafficking in child pornography. (H.R. 1240)
5. THE AMERICAN DREAM RESTORATION ACT: A $500 per child tax credit, begin repeal of the marriage tax penalty, and creation of American Dream Savings Accounts to provide middle class tax relief.
What bill was signed into law by the President?
Family Tax Cuts--$500 per-child tax cut, marriage penalty relief, $1,000 eldercare deduction, and
American Dream Savings Accounts. (Vetoed 12/6/95)
6. THE NATIONAL SECURITY RESTORATION ACT: No U.S. troops under U.N. command and restoration of the essential parts of our national security funding to strengthen our national defense and maintain our credibility around the world.
What bill was signed into law by the President?
U.N. Command of U.S. Troops--Prohibits the president from placing U.S. troops under foreign command. (Vetoed 12/28/95)
Ballistic Missile Defense --Protects America's cities from accidental or terrorist nuclear attack (Vetoed 12/28/95)
National Security Revitalization--The FY '96 defense appropriations bill reversed Clinton's `hollow' military by restoring $7 billion in Clinton defense cuts and providing an additional $600 million for anti-missile defenses . (H.R. 2126)
7. THE SENIOR CITIZENS FAIRNESS ACT: Raise the Social Security earnings limit which currently forces seniors out of the work force, repeal the 1993 tax hikes on Social Security benefits and provide tax incentives for private long-term care insurance to let Older Americans keep more of what they have earned over the years.
What bill was signed into law by the President?
Spousal IRAs--Increases from $250 to $2,000 the amount non-working spouses can contribute to IRAs. (H.R. 3448)
Social Security Earnings Limit--Phases in an increase of the earnings limit to $30,000 in 2002 for seniors who choose to work between ages 65 to 69. (H.R. 3136)
Housing for Older Person Act--Protects senior citizen communities from discrimination lawsuits by defining in law `senior-only' housing complexes. (H.R. 660)
8. THE JOB CREATION AND WAGE ENHANCEMENT ACT: Small business incentives, capital gains cut and indexation, neutral cost recovery, risk assessment/cost-benefit analysis, strengthening the Regulatory Flexibility Act and unfunded mandate reform to create jobs and raise worker wages.
What bill was signed into law by the President?
Unfunded Mandates Reform--Ends intrusive federal mandates that require local governments (i.e., taxpayers) to pick up the costs. (H.R. 5)
Paperwork Reduction Act--Reduces federal reporting requirements by 40 percent over six years. (H.R. 830)
Regulatory Flexibility Act Amendments--Provides judicial review of the Regulatory Flexibility Act and allows expedited congressional review of new regulations costing more than $100 million. (H.R. 3136)
Small Business Tax Relief--Increases equipment expensing from $17,500 to $25,000 and clarifies the tax treatment of home office/product-sample storage costs. (H.R. 3448)
Economic Growth Tax Cuts--Reductions in capital gains and inheritance taxes, among others. (Vetoed 12/6/95)
9. THE COMMON SENSE LEGAL REFORM ACT: "Loser pays" laws, reasonable limits on punitive damages and reform of product liability laws to stem the endless tide of litigation.
What bill was signed into law by the President?
Securities Litigation Reform Act--Prevents class-action lawyers from abusing the rules to extort settlements from innocent companies whose predictions of corporate performance are not fulfilled. (H.R. 1058)
Lawsuit Abuse Reform--Reforms product liability laws to lower litigation costs to employers and end abuses by trial lawyers. (Vetoed 5/2/96)
10. THE CITIZEN LEGISLATURE ACT: A first-ever vote on term limits to replace career politicians with citizen legislators.
What bill was signed into law by the President?
No bill was passed but there were some that were offered on this one...they tried.
R--
Excellent work. I appreciate the time you took. thank you. Dean, I'd like to see this get archived.
ADR
The funny thing is that Arthur Laffer has spent most of his professional life working with Democrats. He isn't a Republican. It's kind of odd that he's viewed as one.
The validity of the Laffer Curve is well-established. You might as well question of the Theory of Evolution (although I know a few people who do) or the Theory of Relativity. It's a well-proven phenomenon, and if you managed to disprove it you'd probably be eligible for a Nobel Prize in economics. What you might dispute is that it should be called the "Laffer Curve" at all, since it's existed in economics textbooks for generations. The basic phenomenon has been observed for, quite literally, centuries.
What we can say we know for sure is that there are repeated periods in American history when increased taxes have been followed by lower revenues, and where decreased taxes have been followed by higher revenues. Just in living memory, that happened under Kennedy, Reagan, and Clinton.
When Ronald Reagan came into office, "the rich" paid 70%. When he left, they paid about 33%. When Bill Clinton came into office, they were paying around 35%, and Clinton boosted it to 40%.
Does anyone here seriously--seriously--think that raising the top rate to 40% was a "reversal" of those horrible Reagan tax policies, or that they resulted in dramatic deficit reduction? What actually happened is that the deficit continued to be a problem, and we had a few years of sputtering economic growth. It was growth, but very much like the growth we're seeing today: slow, anemic, uncertain. I cannot be the only one here who remembers 1993 and 1994 and 1995. That's what those years were like.
The explosive economic growth we saw in the 1990s happened--coincidentally or not--right after Clinton cut the cap gains rate. The economy--and revenues--exploded for the next few years.
The ugly truth: Clinton didn't raise taxes to get rid of the deficit. Democrats should acknowledge this. Their inability to do so continues to speak volumes to me about where they are as a party, and I just don't like it.
---
We don't have a strong model by which to predict perfectly what the exact effets of tax increases and cuts will be. But we do know that under the economic policies that have been in effect by the Federal government since Franklin Roosevelt was President, cutting taxes in time of recession has been considered good economic strategy. This was the standing strategy of the Democratic Party during more than one period in its history--indeed, there was a time when the Republicans were attacking Democrats for this theory because it drove up the deficit.
I wonder if most loyal Democrats realize that their criticisms of deficit spending today echo those of Barry Goldwater 40 years ago. So to turn your argument on its head, Ara, were Democrats wrong then, or are they wrong now?
---
I am all for getting rid of the national debt if possible--at least, most of it. The big issue is, how do you do that?
The biggest concern I have with supposedly "fiscal conservative" Democrats today is that they want to raise taxes on a minority of the population, but don't seem to want to say one word about where and how they will cut spending.
I'm sorry, but this is just a red alert for me: it tells me all they want is more money to spend, and are not in the least bit serious about deficit reduction. If they had a proposal to raise taxes and assure me that all that extra money would go to debt reduction, I would probably be willing to go along with it.
Philosophically, I also admit to having a fundamental difference of opinion: think it's terrifically mean-spirited, and quite selfish, to demand that your neighbor pay a lot more taxes than you simply because he makes a little more. I also think it should be self-evident: the harder you tax those "rich bastards," the more incentive you give them to (a) take their money out of the country, (b) hide their money in tax shelters, (c) put them in "safe" investments that do not help grow the economy, or (d) just flat-out cheat. Shouldn't it be obvious that there's a law of diminishing returns on these things, no matter how rich "the rich" are?
---
You've got a million dollars in the bank. What do you do with it? Invest it and hope to make it two million? But that entails risk. Now, if you not only have the risk of losing that million, but if you know that Uncle Sam is going to take half of it away if you do make a profit, doesn't that reduce your incentive to bother investing?
Come on. Can't we just be adults and see the common sense reality of this? What we need is to find a way to encourage investment, instead of punishing people for getting ahead!
At least that sure as hell seems obvious to me. And why do I have to be a "conservative" to say any of that? For goodness sakes, isn't it just common sense?!?
---
Right now, what I see is one group of people who want to stimulate the economy by cutting taxes--a tried and true formula since the 1930s. And another group who claim they are "fiscally conservative" and concerned about deficits, but aren't willing to tell me what they're going to do to cut spending.
If I have to choose one or the other, I'll go to the choice that stimulates the economy, since we've already seen that sufficient economic growth can erase deficits. It did exactly that in the 1990s.
I'd rather see an overhauled tax code, one that's a lot simpler so we can chart measurements on it more scientifically, and so we give better disincentives for legal, semi-legal, and illegal evasion. I'd like to see creative changes to encourage the wealthiest taxpayers to invest their money in enterprises that help create employment. That would be win-win for everybody.
But if I can't get that, then I'll default to the choice which maximizes individual liberty and helps stimulate economic growth.
I'll get behind deficit reduction again when I hear from the party that promises me that it's really going to use my taxes to cut the debt and not on more spending programs. Then they'd better keep their promise to me, or I'm gone again.
What really gets me is I just don't get why this makes me "right wing" or "conservative." I guess I keep saying that, but really, isn't most of this just common sense?
>>Kevin, if I understand you correctly, you are suggesting some sort of national sales tax with your consumption tax, yes?
Yes Casey, I am.
>>Also, this scheme hits poor people harder. When you only make (say) $200 a week any sales tax hurts. When you make $2,000 a week you have more margin.
Casey,
Actually, it does not. With H.R. 2525, the Fair Tax Act, poor people are well compensated for their poorness. Each and every single poor person in America will receive a monthly stipend from the federal government in Washington equal to the amount of money spent on basic consumption items. For those at the bottom of the economic ladder they pay no effective sales taxes at all. This makes the Fair Tax a PROGRESSIVE sales tax, not a regressive one.
>>BAD idea. Look to see how much VAR taxes are hurting Europe.
Casey,
I am sure you mean VAT taxes do you not? The Fair Tax is not a VAT tax at all. A flat income tax is actually more of a VAT tax than H.R. 2525. Many people object to a consumption tax believing it will morph into a VAT; they usually cite European examples when doing so. This is because these countries consciously chose a VAT, not a consumption tax. No country today uses a true consumption tax. Governments always change their minds when pondering a consumption tax and opt for a VAT tax instead.
It probably has something to do with governments wanting to keep their thumb on citizens. Remember, our European progenitors are the ones who created socialism. An Income Tax is one excellent social engineering tool. That is one major reason I want the Income Tax abolished. I do not believe government should be in the business of picking society's winners and losers. No taxation without representation was one basic tenet of the American Revolution. Our founding fathers repelled one oppressive tyrant to gain more direct control over their own lives. Removing one oppressive Income Tax removes (some) government's ability to control us under the aegis of helping others.
H.R. 2525 is a true to life sales tax. It will abolish the Income Tax and replace it with a simpler, fairer sales tax that will be cheaper to administer, too.
>>Oh, will staple items like food be taxed? Whoopsie, an exemption already!
Casey,
No exemption whoopsie exists here. The Fair Tax taxes all retail purchases of new goods. The Fair Tax taxes no used items. If you want to save money on a home, then buy a resale home. Avoid that tax. I know of no way to buy used food. Therefore, H.R. 2525 taxes all food items.
>>Not to mention that this would hurt sales (might be a good way to encourage saving, by accident [g]).
Casey,
The Fair Tax will not hurt sales at all since the cost of administering the Income Tax is already factored into the price of finished products we already buy. If you remove the Income Tax then you also remove the cost of complying with the Income Tax conservatively estimated at over $250,000,000,000 yearly. That’s one-quarter of a trillion dollars. Removing this cost of compliance will reduce the cost of items you purchase too, due to competition.
Encouraging saving is not an accidental by product. It is actually one of the very reasons to abolish the Income Tax entirely. If you remove all taxation from savings and investment then you will get more investment. Arthur Laffer illustrated this on Kudlow and Kramer last Friday night.
Additionally, if you remove the taxation from work then you get more work i.e., more productivity. This translates into more wealth creation, more jobs. The reason Daimler-Chrysler is not called Chrysler-Daimler is due to our Infernal Revenue Code. The German
Daimler-Chrysler CEO said as much ten years ago. The cost of compliance in America is prohibitive. That’s exactly why so many business move their incorporation status to offshore countries. We lose their direct investment. These and more companies will relocate to the U.S.A. if we remove this prohibitive cost of compliance.
There is no down side to this one. Replacing the Income Tax with the Fair Tax will automatically turn our hurting economy around. It is more stimulative than any tax cut since it encourages wealth creation and work.
>> Not to mention the math is all screwy. Suppose someone pays $3,000 a year in Federal taxes. She would, at 5%, have to spend $60,000 to generate $3,000. And that's forgetting local sales taxes.
Casey,
The Fair Tax rate is 23%, not 5%. Therefore, you will firstly take home your entire paycheck. Currently, if you gross $756, your take home portion is about $556. You lose $200 right off the top. With the Fair Tax, you will take home the whole $756. That makes every single worker a winner. If you want to win too, then work!
A person currently paying $3,000 in Income Taxes must spend over $13,000 to pay a similar amount in sales taxes.
Additionally, please do not forget rich people will naturally buy more than either you or I. Therefore, they will pay more taxes than people will at the bottom end of the economic ladder. The progressive tax that all socialists like will still be there. The Fair Tax will simply encourage everybody to what every American should already do by our nature, work.
This was a very interesting discussion Casey. I am interested in reading your rejoinder to my reply.
Kevin,
With all due respect, having read your responses to Casey et. al. the whole thing sounds like a totally hare-brained idea from top to bottom.
With H.R. 2525, the Fair Tax Act, poor people are well compensated for their poorness. Each and every single poor person in America will receive a monthly stipend from the federal government in Washington equal to the amount of money spent on basic consumption items.
You're kidding right? This part doesn't even come close to passing the laugh test!
Hoo ha!
Kevin, before I forget --
Re: national sales tax --
We in the US are a famously tax-averse people. Don't you think a national sales tax will spawn a rip-roaring black market for almost ANY taxable item...?
Getting rid of the income tax and replacing it with a national sales tax has the support of about a third of the population, and that number continues to grow.
The consumption tax that Kevin describes is a variation on a national sales tax---it's a national sales tax with a monthly refund to the poor to offset their costs, so they can live tax free.
Personally, I see no reason to think that evasion of such a tax would be any greater than evasion of the income tax. Indeed, I suspect it would be less, although there will always be an underground economy that skates whatever tax code we have. (There's a huge one right now, you know.)
A consumption tax like Kevin describes would involve far less paperwork, and be less expensive to maintain, than the current income tax system. I don't think it's laughable.
Indeed, the younger people are, the more likely they are to think things like this are a good idea--and there's not much evidence that they tend to change their minds as they get older.
This idea's time hasn't come yet, but I suspect that, just like School Choice and Social Security Choice, it's only a matter of waiting for the old-school reactionaries to die off in sufficient numbers until fundamental reform can finally be enacted.
I don't know that a consumption tax is in the future, but there is zero doubt in my mind that our current tax code needs reform at the most fundamental levels. A consumption tax is one of several potential ways to scrap the current code and start over. One of them will win eventually, of that I have little doubt.
So laugh while you can, Monkey Boy. ;-)
Feh! More proof that youth is wasted on the young.
>> Kevin, before I forget --
Re: national sales tax --
We in the US are a famously tax-averse people. Don't you think a national sales tax will spawn a rip-roaring black market for almost ANY taxable item...?
Ara,
That’s a good question. There is no doubt that people will cheat using a consumption tax. But you should first balance that with the present cheating present in the current Income Tax. Cato recently documented over $65 billion dollars every single year in uncollected income taxes. In order to cheat on the Income Tax all you have to do is not file, or alternately, not report income you make. This is easier than you might think. I met a bounty hunter in Atlanta who told me he is a CPA during the day. He made over $40,000 as a bounty hunter two years ago he never reported to the IRS. That cheating is easier than cheating on a consumption tax. Cheating with a consumption tax necessarily requires collaboration with another coconspirator. You can cheat Uncle Sam out of any income taxes solamente.
Collecting a national sales tax will be no more difficult than collecting a state sales tax. Forty-five states already collect state sales taxes. Have any of these forty-five states reported a rip-roaring black market for any taxable item? I firmly believe Americans are a fair-minded people. They will support a tax system they perceive is fair. The current Income Tax is not. That is why there is so much cheating, $65 billion of it. May I answer any other interrogatories for you Mr. Rubyan?
Feh! More proof that youth is wasted on the young.
Touche. ;-)
Kevin:
Current state sales taxes run between a couple of percent and upwards of 10% on some items (hotel rooms, etc.) You are talking about a national sales tax of 23% on EVERYTHING.
Big difference. And hence a BIG incentive to cheat. On everything. I think $65 billion is chump change compared to what will happen on the sales tax.
Another thing: Congress will never go for it. Why? Because their sole reason for existence anymore is to dole out tax breaks for their individual constituencies.
Lose the present tax system, and they lose a lot of power. Ain't gonna happen. Count on it.
Lastly: no matter how I consider it, this "rebate" check or whatever you call it for poor people? It sounds like welfare all over again.
I thought you people wanted to end that?
Lose the present tax system, and they lose a lot of power.
This is exactly why it should be done away with. All this foolishness about reforming campaigns is absolutely meaningless. If you want to end corruption in the system, scrap the tax code, which is the primary source of the problem.
That corruption inherent in the income tax system is also why it's going to take big fight to get it done, and generations of effort.
But such battles have been won before. The movement's strength grows by the year. And why shouldn't it? The current system is a moral abomination.
I suppose a fine right-wing conservative argument would be, "we've always had one, how can we change it?" But let's just call that what it is: fear of change, fear of the future.
And hence a BIG incentive to cheat.
The incentive to cheat now is enormous, and I am astonished that anyone would believe it's only $65 billion now. I've seen a lot of the income-tax-free economy, and I'd be surprised if $65 billion even describes how much goes on in a few of the bigger states.
...no matter how I consider it, this "rebate" check or whatever you call it for poor people? It sounds like welfare all over again. I thought you people wanted to end that?
Well no, actually, not everyone does object to welfare. But really, it's something of a sop to people like you, who could otherwise be counted on to howl that such a tax should never be allowed since it would hurt poor people.
In any case, it would be in no way more of a welfare check than the current system. Are you even aware of the Earned Income Credit?
You do identify a real threat: those who would argue that the checks should be made larger and larger, and larger. That's the real achilles heel of the consumption tax.
But isn't that something you should applaud? Being an old-school paleoliberal and all?
...an old-school paleoliberal and all?
Bwah!
They kicked my ass out of the movement the day I bought my first house 25 years ago. Something about ownership of property being a crime...
Before that, I had become a corporate officer in a start-up company. That opened my eyes for sure.
So don't talk to me like I'm someone else. Heh.
;^P
..not everyone does object to welfare.
Depends on whose ox is being gored, right?
..it's something of a sop to people like you, who could otherwise be counted on to howl that such a tax should never be allowed since it would hurt poor people.
The only people it wouldn't hurt would be the pundits who would be guaranteed a topic over which they could argue for decades to come.
("It worked!" "It was a disaster!")
Are you even aware of the Earned Income Credit?
Sure. My ox was gored on that one already. Yours too, unless I'm guessing wrong. Weird thing is I wasn't expecting the check when it showed up one summer day. Wow. What a pleasant surprise. I had no problem spending the money.
Like you all like to say: "It's YOUR money."
Still doesn't justify engaging a truly bad idea whose badness is only exceeded by the sheer unlikely-hood of its eventual passage.
Not in my lifetime anyway.
Bottom line? Paraphrasing Churchill: "Our present tax system sucks until you look at all the other ones."
BTW, no paleoliberal of my acquaintence wants Saddam's head on a pike at the gates of the Presidential Palace in Tikrit.
I'm just saying, you know?
> So don't talk to me like I'm someone else. Heh.
>
>;^P
Okay. Mea culpa. ;-)
> ..not everyone does object to welfare.
>
>Depends on whose ox is being gored, right?
Not in my experience, no, and I've talked to an awful lot of people.
Certain radical libertarians object because they object to anyone being forced to give money to anyone else.
If you look at most libertarian-leaning and conservative folks, however, their primary objections go to lack of responsibility for the money being spent. The Welfare reforms of the 1990s, while they aren't done yet, took away 80% of the argument. Hadn't you noticed that yet? Ever since time limits and work requirements and limitations on how willing we are to pay single moms to stay home and make more babies were put into place, objections to welfare spending have plummetted from most sources I've seen.
You should go out and read some George Gilder or some Marvin Olasky, Ara. ;-)
Dean
If you look at most libertarian-leaning and conservative folks, however, their primary objections go to lack of responsibility for the money being spent. The Welfare reforms of the 1990s, while they aren't done yet, took away 80% of the argument.
My point exactly. Why would you want to turn back the clock and start doling out money again in a new program simply to prop up this thing you call "consumption tax" or "national sales tax."
Why?
You should go out and read some George Gilder or some Marvin Olasky
I've read Gilder for years. Last I heard he was living in a refrigerator packing box on the side of I-80 or something. What's your point?
...and as for Marvin Olasky, do you really want to revisit this guy? Remember what Frank Rich wrote a while back?
Now Mr. Olasky [has written a piece] for the Austin American-Statesman implying that journalists who are critical of Mr. Bush have "holes in their souls," practice "the religion of Zeus" and are therefore hostile to the Texas governor's Christianity.
The only three journalists he cites by name happen by total coincidence to be Jewish (Bill Kristol and David Brooks of The Weekly Standard are the other two).
I'm sure it's also a coincidence that Mr. Olasky, a former Jew who converted to Christianity over twenty years ago, has spun this theory at a moment when Pat Robertson is targeting Mr. Rudman, the most visible Jew in the McCain campaign.
Mr. Olasky phoned me -- but only after his column prompted embarrassing national press calls to the Bush campaign to reassure me that of course he's not an anti-Semite.
Whew!
He still hasn't told me whether the religion of Zeus goes in for Bar Mitzvahs. Now I suppose some will view me as a rigid ideologue, i.e., a phony liberal, for dredging this up, but gosh, I'm not telling Olasky to sit down and shut up. Or submit to "re-education."
As far as I'm concerned, the more people who know what Olasky stands for, the better, you know?
Why would you want to turn back the clock and start doling out money again in a new program simply to prop up this thing you call "consumption tax" or "national sales tax."
Income tax refund checks are not welfare checks. Neither are sales tax refund checks. Your characterization is flawed.
As for Olasky: If Olasky--by birth a Jew--is an anti-semite, I'll need more evidence than what you've quoted, which looks suspiciously one-sided to me, and doesn't sound like the Olasky I know. But I don't know enough about it to say for sure.
What I do know is what he's written in his books and said in interviews I've seen, which so far as I'm concerned are strong on history and good on reasoning as far as the flaws of the old welfare system were. Your suggestion was about people objecting to welfare checks depending on whose ox was gored, and I say to you no, that's not so, and if you want examples of "conservative" arguments against the welfare state, those are good places to go to see it.
By the way, so far as I'm aware, Gilder is still a wealthy and successful man. He seems to have gotten out of politics, having won most of his arguments about the welfare state, and is now working in high tech. Unless you know something I don't.
Income tax refund checks are not welfare checks. Neither are sales tax refund checks.
That's the best you can do? You people keep saying that if you send it to Washington you'll never see it again. What about this? Wouldn't it be easier to just cut taxes?
re: Olasky -- I guess I'm guilty of tuning the guy out permanently after that last episode. Call me hyper-sensitive but the idea he was espousing was so toxic that just a little bit goes a long way. I didn't, don't want to hear anymore from the guy.
By the way, perhaps you could compare and contrast Olasky's career with that of DiIulio?
[Gilder] seems to have gotten out of politics, having won most of his arguments about the welfare state, and is now working in high tech.
Heh.
Right. High-tech. Telecom. Global Crossing. That's the ticket!
Jonathan Chait had the latest update on the Gilder saga here. Scroll down to the bottom.
That's the best you can do?
Tax refund checks aren't welfare checks. What more needs to be said?
You people keep saying that if you send it to Washington you'll never see it again. What about this?
I got my income tax refund check. Didn't you?
Jeez, Ara. You don't even engage in circular logic. Just a bizarre form of anti-logic.
Jonathan Chait had the latest update on the Gilder saga here.
I see that, unfortunately, Chait continues his slow decline into madness. Not only was most of that nasty, but parts of it were just flat out false.
The New Republic needs to do some housecleaning, obviously.
>> Big difference. And hence a BIG incentive to cheat. On everything. I think $65 billion is chump change compared to what will happen on the sales tax.
Ara,
Please do not forget that two people must collude in order to cheat on a national sales tax. It is easier for any one person to cheat presently on the Income Tax. All you have to do is not file by April 15.
I am not sure why you believe there will be more tax evasion with a national sales tax than with the present Income Tax. Forty-five states already have sales taxes. I have not heard any states anywhere report massive tax evasion with state sales taxes. So, why would there be any more tax evasion with a national sales tax than with forty-five state sales taxes? Please provide some sound argumentation supporting this irrational statement.
>> Another thing: Congress will never go for it. Why? Because their sole reason for existence anymore is to dole out tax breaks for their individual constituencies.
Ara,
You know that’s right. Another term for this is “social engineering.” Politicians cannot resist doing “good” for other people. Governments should not be in the business of choosing society’s winners and losers. That is exactly what social engineering does. It is also the #1 reason I support a national sales tax.
The fundamental tax reform I advocate, a national sales tax, will do more to stimulate our economy than any single tax break. Markets do NOT like unpredictability. The Fair Tax, H.R. 2525, will provide more stability, and hence predictability, in tax policy than “modifying” our internal revenue code ever will. It will do so if for no other reason, than that politicians tinker yearly with the existing infernal revenue code.
That is the outward manifestation of social engineering when politicians try to do “good.” Unfortunately, when a politician does “good” for one group he does the opposite for another. That is the fundamental conundrum with socialist government policy. It is zero-sum. Socialist governments are in the business of choosing society’s winners and losers. The Fair Tax will not end social engineering entirely; but it will certainly trim the sails of many do-gooder politicians.
Reagan simplified the income tax in 1987 reducing the number of marginal tax rates from 14 to three. We had eight by the time Clinton left office. Politicians added over 80,000 pages to the internal revenue code since its 1987 “simplification.” You cannot tame this monster. Fundamental tax reform is the only real answer to our overly complex Income Tax. Politicians will NEVER stop manipulating the internal revenue code to benefit some special interest group, be it voting constituents or a business interest. That is why over 80% of the lobbyists in Washington, D.C. are there lobbying for changes to the internal revenue code. So, you can also see how fundamental tax reform will equal campaign finance reform.
>> Lose the present tax system, and they lose a lot of power. Ain't gonna happen. Count on it.
Ara,
That’s the whole idea. I am not deterred.
>> Lastly: no matter how I consider it, this "rebate" check or whatever you call it for poor people? It sounds like welfare all over again. I thought you people wanted to end that?
Ara,
You go right for the jugular. But that’s all right. I am ready for that, too. This rebate check is not really welfare for the poor. It is actually welfare for everybody since everybody will receive the monthly rebate check. This rebate check is also the fulcrum that changes the Fair Tax from a regressive sales tax to into a progressive one.
Think of the rebate check as the sales tax equivalent to the Earned Income Tax Credit (EITC) that poor people receive when filing their yearly 1040EZ with one delightful twist. You won’t have to file anything to get it! You already get it by virtue of being American. Now, if you wish to call the EITC welfare, I suppose you can. I will not stand in your way. Why don’t you join me in making April 15th just another day? Visit http://www.fairtax.org.
I have not heard any states anywhere report massive tax evasion with state sales taxes.
Kevin, you're assuming they know about it.
You go right for the jugular.
Moi? I'm a harmless furry mammal.
It is actually welfare for everybody since everybody will receive the monthly rebate check.
Gah! Did you ever see the movie Brazil? That's my picture of the future under this plan.
Why can't we just cut taxes?
Although I support the consumption tax concept (or some other fundamental reform like it), it does have problems. Here are three:
1) The rebate check goes to everybody, which is fine. This is not much more large-scale than the income tax refund and Social Security checks the government issues now. We all get a monthly rebate to make up for a certain amount of spending, so that the average person making under a certain amount of income will never really pay the tax.
However, the temptation of politicians to inflate the size of those rebate checks higher and higher will be ever-present, and it could turn into a welfare check like Ara describes.
2) I'm afraid Kevin is missing a point. A national sales tax would largely be collected by vendors. Therefore you really only need one party to cheat: the business that collected the tax. If I pay a tax on my car, that doesn't prove that the car dealership sent the check to the dealer.
So you really still do only have one party who needs to cheat.
Having said that, however, enforcing this would be much easier. Businesses by and large are already used to this stuff because of payroll taxes, which they would be relieved of having to do. In the meantime, policing businesses who seem to be underpaying their taxes is a lot easier than policing 300 million individuals.
>>Gah! Did you ever see the movie Brazil? That's my picture of the future under this plan.
Ara,
I have never seen Brazil.
>>Why can't we just cut taxes?
Ara,
I am for tax cuts, too; but tax cuts will last only so long as one party remains in power. You can bet your bottom dollar that Democrats will raise taxes the first chance they get.
Cutting marginal taxes, especially capital gains taxes and dividend taxes, is one great idea. Although, Democrats will always demagogue either of those tax cuts as tax cuts for the rich. Well… no shit Sherlock! Just who in the hell do you think pays 50%-90% of the taxes anyway? You cannot cut taxes on people who do not pay any taxes. Therefore, the best place to look when cutting marginal tax rates is where the majority of income tax revenue originates.
Unfortunately, when Democrats begin talking about the “rich” paying their fair share “rich” seems to creep down the income ladder each time. Now, rich people are those EARNING over $50,000. Please excuse me if I am wrong, but earning $50,000/year does not make you rich. I consider you well off if you earn at least $200,000/year. I am sure you and other Dems will disagree. Imagine this horrific scenario.
Democrats remove 50% of Americans from the Income Tax rolls. If they ever successfully accomplish this, then America will become tax cut proof since over ½ of the voters will not pay any Income Taxes anyway. Then anybody left paying Income Taxes will be automatically titled “rich.” That will probably around the $40,000 yearly income level. Currently about 45%-48% of Americans do not pay income taxes.
Currently Republicans control more votes in both the Senate and House. If Democrats want to do this, they must win more elections first. Democrats are the minority at every level of government, thank God! The only ones stopping Democrats from accomplishing this are the Republicans.
You can bet this will be preceded by beaucoup class warfare argumentation. Democrats may even throw some class warfare arguments, too. In short, the Income Tax is one perfect way for politicians to pit one American against another, one class against another, one profession against another, etc. Obscenely clamoring this way for votes is one permanent, pandering campaign technique. You can always make one constituency group happy at the expense of another. We must stop pitting American against American this way.
To sum up Ara, cutting taxes is fine; but it is impermanent because it relies on politicians. Fundamental tax reform is the only way to stop politicians from socially engineering our society. The Fair Tax is not perfect. However, it is better than relying on politicians for our future.
Here's the far more likely "horrific" scenario:
You correctly pointed out 45%-48% of Americans do not pay income taxes.**
What if the GOP decide that this is not fair? Wouldn't it be good politics to re-work this so that more middle and low income families pay their fair share?
..........................................
**Doesn't this poke a hole the GOP contention that we all want tax reform? Look, the majority of tax filers don't even itemize. How complicated are their taxes? How badly do they need tax simplification?
We're even seeing surveys showing the majority of respondents don't care about tax cuts in a time of war and deficits.
I don't see how anyone could find that scenario likely, Ara. Republicans have been talking about cutting payroll taxes, which is what lower income people like myself primarily pay, and no one in that party has said a word about raising taxes on anyone anywhere.
Our family income is currently right on the edge, so I pay almost nothing in income taxes, but lots and lots of payroll tax. I don't know when I'll be given the free choice to put some of that money in my own account (thanks, Democrats) but I would be willing to bet you five bucks I get a cut in the payroll tax. Which I could very much use, thank you very much.
As for surveys showing that a majority of people don't particularly want tax cuts: yeah, but a majority are not strongly opposed to it, either. Fact of the matter is that a lot of us want tax cuts, badly, and will punish Republicans for not giving them to us.
Who will punish the Republicans for giving them to us? No one. The only people who will angrily vote against Republicans because of tax cuts -- all five of you -- are people who wouldn't vote Republican anyway.
As Zell Miller, the Voice Of Sanity for the Democratic Party, has put it: tax cuts are good politics and good policy.
>>However, the temptation of politicians to inflate the size of those rebate checks higher and higher will be ever-present, and it could turn into a welfare check like Ara describes.
Dean brings up a good point here. I often hear this objection regarding the Fair Tax. I also have a solution for it. Remember Republicans passed some legislation about eight years ago requiring a super majority vote to increase taxes. This will cover the Fair Tax, too. Republicans need to pass such legislation if it is not already covered. Statutory legislation can easily mitigate this.
The Fair Tax will base the size of this rebate upon General Accounting Office figures. Whatever the GAO establishes as the subsistence income level will determine the rebate amount. In addition, everybody will receive this rebate if one poor person receives this rebate. Therefore, if politicians attempt to socially engineer this program, they will simply be increasing welfare for every American since every American will receive this rebate check. This will seriously mitigate the social engineering further Mr. Rubyan mentioned.
>>2) I'm afraid Kevin is missing a point. A national sales tax would largely be collected by vendors. Therefore you really only need one party to cheat: the business who collect the tax. If I pay a tax on my car, that doesn't prove that the car dealership sent the check to the dealer.
Dean,
You overstate the scale of this problem. I also have just the Rx for this malady. Let’s first assay this objection rationally and common sensically. Remember, forty-five states already collect sales taxes. All retailers will send their Fair Tax portion to each respective state revenue department.
This means retailers cheating on the Fair Tax will stick out like a sore thumb. If retailers cheat, as you believe, state governments will see it in their tax receipts. All you have to do is apply first year algebra to determine the total tax liability for any retailer by multiplying, the say 6% MI portion, by total sales and adding that to sales. Then add this amount to the 23% national Fair Tax portion to properly compute total tax liability. You see, any retailer automatically reports himself to THE tax authorities i.e., state tax authorities, whenever he cheats on his taxes. Now, that leaves only five states and the inevitable (moronic) tax cheaters who will inevitably cheat.
The simplest remedy for this is to simply pay a bounty to anybody who correctly reports a tax cheater not accurately reporting his proper 23%. Finding tax evasion is further simplified since the only tax evaders left will be retailers not paying their 23%. The exact statutory language is not important here. You can pay this bounty to individuals, state governments, or whomever you choose. You can easily work out these minor details later. Please remember, I did state before there WILL be tax fraud with the Fair Tax. It is not perfect. No tax system is.
However, the amount of tax evasion will be less than with the Income Tax. I personally believe Americans will be more willing to pay the cost of government using a tax system they perceive is fair. This is fairer than what we now have. Therefore, tax fraud will be less. Cato calculated over $65 BILLION annually in uncollected income taxes. Catching tax cheats will be simpler using the Fair Tax; and the Fair Tax will be cheaper to administer overall than the Income Tax, as well. Help us in making April 15th just another day. Visit http://www.fairtax.org.
Importune my humble self with your next supplication please, drum roll.
>> You correctly pointed out 45%-48% of Americans do not pay income taxes. Doesn't this poke a hole the GOP contention that we all want tax reform? Look, the majority of tax filers don't even itemize. How complicated are their taxes? How badly do they need tax simplification?
Ara,
The reason most people do not itemize is that the infernal revenue code is so complex. The IRS gives incorrect answers 46% of the time to people preparing their income taxes. Even the IRS does not understand the internal revenue code for God’s sake. There is no way to save this monstrosity. John Linder is absolutely correct. The only thing we can do is to tear the current tax system out by its roots and start all over again.
You stand an excellent chance of being audited if you are rich and choose to itemize. How many people rich or poor want to bother with that? Hell, everybody is afraid of the IRS! A national group called the National Audit Defense Network exists to help common people with their income tax issues. The NADN consist of FORMER IRS auditors who know from personal experience that the IRS bullies people into paying more taxes than they actually owe. You can reach them at 1-888 AWAY IRS, or http://www.awayirs.com/.
The IRS pays its auditors a percentage of the taxes they collect. It is called a percentage, a bounty. The IRS looks more every day like the corrupt, old Roman tax collectors that Jesus protested in the Old Testament. I do not blame even the IRS for this. Politicians force IRS employees to deal with this refuse of their own creation. That's what you get for placing your future in the hands of politicians. You simply cannot reform this tax system. All you can do is round file it.
>> You correctly pointed out 45%-48% of Americans do not pay income taxes. What if the GOP decided that this is not fair? Wouldn't it be good politics to re-work this so that more middle and low-income families pay their fair share?
Ara,
You know exactly what would happen if Republicans tried to do this. All Democrats will raise holy hell. All liberal news hosts will report greedy Republicans paying off their fat cat contributors. Any liberal radio talk show hosts left will preach Marxist class warfare.
President GWB went through all this to get his measly, paltry tax cut passed one year ago. Bush's eviscerated tax cut had no impact since it was too small and did not go to the right people paying the most taxes. Democrats simply torpedoed this tax cut to spite President Bush and emasculate his tax cut. Democrats will accuse Republicans of taking food out of the mouths of poor people for increasing poor people's tax burden and imposing a regressive tax system on the poor. It will be a mess. That is why I believe the only hope Americans have lies in fundamental tax reform.
Politicians never mention that all tax systems are either regressive or progressive. It is unavoidable. This leaves politicians in an ideal position to demagogue any tax issue to death from either side. Does that not make you a demagogue yourself?
Also, what is a “fair share?” You ideally couched your vagary nicely here. What is “fair” to me is not “fair” to you. What is “fair” to you is not “fair” to me. This imprecise language is just the nonsense Clintonistas exploited the past ten years dividing Americans, pitting them against one another. I believe it is time to end this tomfoolery. This imbecilic class warfare ends where the Fair Tax will begins.
It is time somebody led. Democrats obviously cannot do this leadership thing. They chose Clinton and Gore to lead them the past twelve years after all. They chose bad leadership.
All new ideas currently originate with conservatives anyway. The Fair Tax will mitigate this unnecessary invidious junk. Help us make April 15th just another day. Visit http://www.fairtax.org. You can also reach them at phone 1-888-FAIRTAX.
Fifty geek points to anybody who can name the person who said this: “The most complex thing in the entire universe is the Income Tax.”
I can't name that, but I can give you a similar quote.
Many of us have heard the phrase, "A nation that can put a man on the moon can surely [fill in the blank]."
What was the first use of it? It was from a commentator who said, "A nation that can put a man on the moon can surely find a way to get rid of the income tax." Drat it, I wish I could remember his name.
Dean and Kevin:
I don't see how anyone could find that scenario [lower and middle-income earners paying more tax] likely, Ara. Republicans have been talking about cutting payroll taxes, which is what lower income people like myself primarily pay, and no one in that party has said a word about raising taxes on anyone anywhere.
First off, the most important Republican of all is against a payroll tax cut: George W. Bush.
And BTW, this is an idea that has been consistently floated by Democrats from day one.
Second of all, if you think "no one in that party has said a word about raising taxes on anyone anywhere" you haven't been paying attention.
The whole thing kicked off on Nov. 20, when the WSJ printed an editorial called "The Non-Taxpaying Class" [can't provide the link,
sorry.]
Right around then there was an article put up on
the web by the
Heritage Foundation written by
Congressman Jim DeMint.
In those pieces, they posit the many reasons why a scenario like this is desirable.
Those articles were quickly followed by articles in the
Washington Post,
Salon,
MSNBC, and
Slate.
There are other articles too but you get the point.
You really ought to be more open to the idea that the GOP has a tax agenda that may not be in your best interest.
I know it's hard to fathom, but stranger things have happened.
Well, it is unfair that people making two or three times what I do pay five or six times as much in income tax. And, it's also true that lower-income earners like myself have already gotten a very big tax cut from Bush--far bigger than any other group, in fact. So might they want some of that back? Perhaps.
But call me a skeptic. I suspect the press is playing up rumors here, and that this is exceedingly unlikely to happen.
A scenario that strikes me as more likely is that the Bushies will propose something that flattens rates--a very, very good idea--and it winds up raising rates very slightly on lower income earners like myself. But what I would expect to see in the end is that Bush will (as he always does) outmaneuver Democrats so badly they don't know whether to shit or go blind. He will propose tax changes that he knows they and some Republicans will never go along with, just so he can "give" them special tax credits and exemptions that will reduce the overall burden on the lower income levels.
And he'll wind up laughing all the way as he, once again, gets 80% of what he wants by "giving" Democrats things he was already planning to give them. While we wait for it to happen, Democrats will bray that they are "saving the poor from the evil Republicans," and we'll all get to spend a few months wondering if that ever-expanding blood vessel in Paul Krugman's brain will finally explode.
You can go ahead and say "I told you so" if I'm wrong. I'll even post a big "Ara was right, Dean Was Wrong" article if I'm wrong. How's that for a bet?
I liked the spin the Post put on it, though. Preparing "sophisticated" tables to make it "appear" that the poor are paying less. Fancy that. Will they be preparing sophisticated tables to make it appear that fat people weigh more, too?
---
As for Bush opposing a payroll cut tax: Word I've heard is that the White House is simply holding back on the payroll tax cut in order to give it to the Democrats in exchange for other things. There are plenty of Republicans in congress who are open to it, and it seems to be a primary goal for Democrats. Most Washington observers think this is going to happen.
To be honest I think it's a lousy idea; they should let us put the money in private accounts instead, to help us move out of the current ripoff system. That would be a far, far greater gift to the poor than any tax cut. Indeed, it would be a greater gift to the poor than any President has managed to deliver in my lifetime.
Dare to dream, eh?
...the Bushies will propose something that flattens rates...and it winds up raising rates very slightly on lower income earners like myself.
...Bush [then] will outmaneuver Democrats so badly they don't know whether to shit or go blind.
The Democrats get out maneuvered? I'd say in light of the above, it's you that got outmaneuvered, my trusting friend.
[shrug] I don't think so, for reasons I won't bother repeating.
>>Fifty geek points to anybody who can name the person who said this: “The most complex thing in the entire universe is the Income Tax.”
It was none other than Mr. Albert Einstein himself." The word universe was key to getting this one right.
>>First off, the most important Republican of all is against a payroll tax cut: George W. Bush... BTW, this is an idea that has been consistently floated by Democrats from day one.
Ara,
I do admire your persistence. You actually take time to think through a position before posting. We will have to agree to disagree on this one however, as we have throughout this posting.
This payroll tax cut is one consistently proposed by Democrats from day one. I doubt that GWB will let Democrats to outmaneuver him on this tax cut business by a long shot, though. It is just not their issue. Remember, Democrats cannot talk taxation, taxes, or tax cuts with any real credibility. Democrats’ propensity is to consume, consume, and spend, spend. The same is true regarding Republicans and race. Every time we Republicans talk race we get burned because it is not our issue. We would be smart to just allow Democrats to get all the points they like on the race issue and move on to something else. That is better than allowing your opponent to beat you up all over again on the same issue scoring more points against you in the court of public opinion.
When Democrats use the tax issue they are simply expressing the class warfare divide and conquer strategy again by other means. Democrats know they cannot stop Bush from speeding up his measly tax cut from last year. They also know they cannot stop Bush from ramming through a more meaningful one this year. A good, strong capital gains tax cut is just too central to Bush’s plans for a healthy economy in 2004. Without a real strong capital gains tax cut the economy will likely flounder putting Bush’s 2004 reelection in doubt. The only reasonable option Democrats have left is to deflect some of the credit for this inevitable tax cut on to them. They can then campaign for a tax cut for the workingman thereby positioning themselves as the workingman’s representatives in Washington.
This is a smart idea. Democrats know they cannot control any agenda items since they do not control either the executive branch or the legislative branch in Washington. Voters do not even trust Democrats to control the majority of state legislatures. The Democrats attempted Marxist class warfare in 2002 positioning themselves as the minority party for the foreseeable future at every level of government nationwide. Now, the only card they have left is to play the “me too” card.
That is where the payroll tax cut comes in. Democrats are positioning themselves as the “me too, I’m for the Bush tax cuts" party for the next two years. Despite this, they still cannot relinquish all Marxist class warfare tendencies. Democrats demand ONLY a payroll tax cut to benefit the poorest. I guess old habits die hard. Or, perhaps Democrats simply forgot how sound economies operate.
Bush will have none of this. He will go along with the payroll tax cut in the end, Ara. He may oppose it now; but do not expect GWB to do so for long. He will toss the Democrats a bone and the two parties will agree on a good quid pro quo. Hopefully, Democrats will not get as much mileage using this payroll tax cut strategy as they wish. Bush just might eat their lunch again…hopefully.
This gamesmanship is why I so strongly support The Fair Tax fundamental tax reform. For as long as we have an Income Tax, we will have politicians who exploit it using Marxist class warfare. Why do you think Karl Marx proposed a highly progressive income tax in the Communist Manifesto? It is necessary for creating invidious class jealousies exploited by socialists.
This gamesmanship is tearing America apart. We cannot forever prosper pitting American against American, class against class. I believe this is one element of the race issue exploited by Democrats. Ending the Income Tax will mark the beginning of the end of this garbage.
I see CNN is already politicking against a GWB tax cut. Democrats still haven’t realized how Marxist class warfare argumentation cost them in 2002. But then again, that might just be good.
Hopefully GWB will have the stones to adamantly propose a good, strong capital gains tax cut and an abolition of capital gains taxes. A strong tax cut is central to Bush’s plans for a healthy economy in 2004. Without a real strong capital gains tax cut the economy will likely flounder putting Bush’s 2004 reelection in doubt.
Kevin:
Just out of curiosity, could you provide specifics on CNN's campaign "against a GWB tax cut."
What did they say? Who said it?
Please be specific.
>>Fifty geek points to anybody who can name the person who said this: “The most complex thing in the entire universe is the Income Tax.”
It was none other than Mr. Albert Einstein himself." The word universe was key to getting this one right.
I must point out with some bemusement that Professor Einstein also bragged about not knowing his own phone number ("Why should I? I can always look it up in the phone book.")
Ara,
Here is the link to the story: http://www.cnn.com/2003/ALLPOLITICS/01/02/bush.economy/index.html
It is linked in Rosemary’s posting: Bush to Unveil Economic Package Next Week (Rosemary)
The implication is rather subtle. But this lead implies that GWB is admitting to having an already healthy economy while simultaneously stating the economy needs stimulating. CNN is clearly trying to make GWB look dense for tacitly stating a contradiction. Here is the introduction along with the dateline.
Thursday, January 2, 2003 Posted: 6:56 PM EST (2356 GMT)
CRAWFORD, Texas (CNN) -- Even as he expressed his faith in the underlying strength of the American economy, President Bush said Thursday he will unveil an economic stimulus package next week with a focus on creating jobs.
>>It was none other than Mr. Albert Einstein himself." The word universe was key to getting this one right.
>>I must point out with some bemusement that Professor Einstein also bragged about not knowing his own phone number ("Why should I? I can always look it up in the phone book.")
Ara,
Can you look up the Infernal Revenue Code in the book, too? Einstein was obviously making the point that he could care less about trifles. He was probably interested totally in his work. If you ever see a photograph of him you will see Herr Einstein also cared less about fashion. So, I suppose you can also make the case that he did not know where the local Sears store was either. He could always match up all his clothes using Granimals.
But I believe Mr. Einstein was making the credible point that our Income Tax was excessively complex in the 1950’s. If that was true fifty years ago, then it is truer now than ever. Please remember over 50,000 pages have been added to the Internal Revenue Code since tax simplification in 1987.
I found a good introduction to the history of the Fair Tax on this web site: http://www.azfairtax.org/facts.htm. It is the Arizona web site for the Americans for Fair Taxation. This page gives anybody a good introduction to the Fair Tax movement explaining how the movement started and includes some important details on how the Fair Tax will work. It answers many of the questions you asked earlier.
Kevin:
I read the article from CNN. The lead sentence contained three words that told me what I needed to know: "Bush... faith...strength."
Why would you object to that?
Ara,
It is not the use of the three words Bush…faith…strength in the lead sentence to which I object. It is the condescending tone that begins the article. The media still hasn’t over the “Bush is stupid” yet after losing the 2000 Presidential election. Bush is not stupid; and yes, Bush really did win the 2000 Presidential race.
Yet still, the big media repeatedly tries to paint the Yale and Harvard graduate as being two quarts low. This time CNN cleverly interposes this subliminal message in the lead sentence by juxtaposing an apparent contradiction in the lead. Bush wants to stimulate an economy that he himself admits is strong.
CNN completely omits any economic reasons. Everybody knows this economy is ailing and investors need some encouragement to begin investing to expand this economy. They do not even attack the supply side argument any more. I am waiting for a good Keynesian-Monetarist debate that won’t happen.
So. Recent news proves that this stuff about Bush raising taxes on poor people was, indeed, nonsense all along. And the newly proposed tax cuts shift even more of the overall tax burden on high-income tax earners.
What a shock. ;-)
Dean,
So, what's new? The media are nothing more than Democratic Party shills. They pander to the worst Democratic rhetoric and scrutinize every last Republican misstatement. Do you think the average television watching American will ever wisen up?