Thread: FairTax and Trade

Originally Posted by johnwk

Well, that answers why you also support the socialist friendly "fairtax".

Originally Posted by Judy

Well, if you want to call exempting FairTaxes for necessities up to a poverty amount "socialism", then you're free to do so. I would call it lowering the effective FairTax rate for American citizens and legal residents.

John seems to take the libertarian position that if you don't earn it, you should curl up by the roadside and die. But Judy is so compassionate that she would give away the store!

Judy's FairTax tries to be compassionate, much as the Income Tax Code does, but I see too few safeguards against abuse with that system.

Originally Posted by jtdc

John seems to take the libertarian position that if you don't earn it, you should curl up by the roadside and die. But Judy is so compassionate that she would give away the store!

Judy's FairTax tries to be compassionate, much as the Income Tax Code does, but I see too few safeguards against abuse with that system.

There are plenty of safeguards, more than with the income tax. With the FairTax, in 45 states, where the states are collecting from the retail businesses, you'll have both the state and the feds on your case if you try to cheat. It won't be pretty.

Originally Posted by jtdc

John seems to take the libertarian position that if you don't earn it, you should curl up by the roadside and die.

Your post indicates you do not engage in charitable giving. My position has nothing to do with a libertarian position. It has to do with charitable giving vs tyranny, and the purpose for which our federal government was created. But don't listen to me. Let us review the words of one of our forefathers:

"Under a just and equal Government, every individual is entitled to protection in the enjoyment of the whole product of his labor, except such portion of it as is necessary to enable Government to protect the rest; this is given only in consideration of the protection offered. In every bounty, exclusive right, or monopoly, Government violates the stipulation on her part; for, by such a regulation, the product of one man's labor is transferred to the use and enjoyment of another. The exercise of such a right on the part of Government can be justified on no other principle, than that the whole product of the labor or every individual is the real property of Government, and may be distributed among the several parts of the community by government discretion; such a supposition would directly involve the idea, that every individual in the community is merely a slave and bondsman to Government, who, although he may labor, is not to expect protection in the product of his labor. An authority given to any Government to exercise such a principle, would lead to a complete system of tyranny."

See Representative Giles, speaking before Congress February 3rd, 1792


JWK

Originally Posted by Judy

There are plenty of safeguards, more than with the income tax.

More Snake-Oil? You downplay the number of opportunities there are to cheat. You point to the retailers, but there is opportunity from the manufacturer/importer through the entire chain.

Granted the Income Tax system is burdensome. But that is a necessity. Our computers could be efficient, but we have to add on security programs to protect from dishonest people. A space ship could be relatively simple, but we build in redundancy and monitoring systems, just in case. If everybody was honest, IRS wouldn't have to do audits. But that's not the real world.

With the Income Tax system, your employer declares what you earned. IRS can match that up with what you report that you earned. If one business takes a deduction, the business selling to them reports the transaction so IRS can verify the legitimacy of that deduction.

Your sales tax has virtually no records. So when it comes to the Rebate, they must give it to everybody because there is no record for them to determine who needs it.

Originally Posted by Judy

With the FairTax, in 45 states, where the states are collecting from the retail businesses, you'll have both the state and the feds on your case if you try to cheat. It won't be pretty.

Like they are keeping out illegal aliens? Like they have done away with crime syndicates? They may have the will, but they have shown that they are incapable!

Originally Posted by johnwk

Your post indicates you do not engage in charitable giving.

Try reading it again. I was talking about you!

Originally Posted by johnwk

My position has nothing to do with a libertarian position. It has to do with charitable giving vs tyranny, and the purpose for which our federal government was created.

Your position is about going back to a system from long ago. When this country began, there were 13 independent states. Each was its own independent system. The federal government was small. It only administrated disputes between the states.

Later, the federal government put together a standing military complex. So they needed more money. The system you advocate was no longer sufficient, and it isn't. In fact, early on, landowners were the only ones with "rights". As the country grew , it changed. Many politicians decided to finance those who could not take care of themselves. Welfare was born. This amounted to major wealth transfer. That was the generosity that has put us in debt.

Where tariffs alone could finance the government at the start, that cannot work today.

Originally Posted by johnwk

But don't listen to me. Let us review the words of one of our forefathers:

Only one? The Constitution is a compromise between several people. And that is what we live by.

Originally Posted by jtdc

Only one? The Constitution is a compromise between several people. And that is what we live by.

Ok. Let a number our our founders explain the validity of the rule of apportionment to you . . . a vital protection to insure equal taxation whenever the federal government taxes the people directly:

Pinckney addressing the S.C. ratification convention with regard to the rule of apportionment :

“With regard to the general government imposing internal taxes upon us, he contended that it was absolutely necessary they should have such a power: requisitions had been in vain tried every year since the ratification of the old Confederation, and not a single state had paid the quota required of her. The general government could not abuse this power, and favor one state and oppress another, as each state was to be taxed only in proportion to its representation.” 4 Elliot‘s, S.C., 305-6

And see:
“The proportion of taxes are fixed by the number of inhabitants, and not regulated by the extent of the territory, or fertility of soil”3 Elliot’s, 243,“Each state will know, from its population, its proportion of any general tax” 3 Elliot’s, 244 ___ Mr. George Nicholas, during the ratification debates of our Constitution.

Mr. Madison goes on to remark about Congress’s “general power of taxation” that, "they will be limited to fix the proportion of each State, and they must raise it in the most convenient and satisfactory manner to the public."3 Elliot, 255

And if there is any confusion about the rule of apportionment intentionally designed to insure that the people of each state are to be taxed proportionately equal to their representation in Congress, Mr. PENDLETON says:

“The apportionment of representation and taxation by the same scale is just; it removes the objection, that, while Virginia paid one sixth part of the expenses of the Union, she had no more weight in public counsels than Delaware, which paid but a very small portion”3 Elliot’s 41

JWK


If, by calling a tax indirect when it is essentially direct, the rule of protection could be frittered away, one of the great landmarks defining the boundary between the nation and the states of which it is composed, would have disappeared, and with it one of the bulwarks of private rights and private property. POLLOCK v. FARMERS' LOAN & TRUST CO., 157 U.S. 429 (1895)

Originally Posted by johnwk

Pinckney addressing the S.C. ratification convention with regard to the rule of apportionment :

“With regard to the general government imposing internal taxes upon us, he contended that it was absolutely necessary they should have such a power: requisitions had been in vain tried every year since the ratification of the old Confederation, and not a single state had paid the quota required of her. The general government could not abuse this power, and favor one state and oppress another, as each state was to be taxed only in proportion to its representation.” 4 Elliot‘s, S.C., 305-6

Sounds like the financing of the United Nations!

Originally Posted by johnwk

And see:
“The proportion of taxes are fixed by the number of inhabitants, and not regulated by the extent of the territory, or fertility of soil”3 Elliot’s, 243,“Each state will know, from its population, its proportion of any general tax” 3 Elliot’s, 244 ___ Mr. George Nicholas, during the ratification debates of our Constitution.

And there is the flaw in your proportional tax. With each state taxed based on its population, there is an inequity. Originally the thirteen Colonies/states were economically equal. But as time went by and new states were added, this formula created great differentials. In a state like Texas, where the natural source of oil is plentiful, but the number of people is sparse, the per-capita income is high. Other states may have similar population but per-capita income is much lower. Under this plan people in states with lower per-capita income would be paying maybe twice the percentage of their income to finance the federal government as people in a rich state. With either a sales tax or an income type tax, the amount of tax is geared to the local economy.

Originally Posted by jtdc

Sounds like the financing of the United Nations!

And there is the flaw in your proportional tax. With each state taxed based on its population, there is an inequity. Originally the thirteen Colonies/states were economically equal.

That is not true. And there is no flaw in the founder's agree upon rule for direct taxation and representation, both to be based upon population which boils down to an equal per capita tax if laid directly upon the people. I see nothing wrong with "representation with a proportion financial obligation". Of course our socialist crowd and free government cheese crowd fear equal taxation with a passion.


JWK

Originally Posted by jtdc

Under this plan people in states with lower per-capita income would be paying maybe twice the percentage of their income to finance the federal government as people in a rich state. With either a sales tax or an income type tax, the amount of tax is geared to the local economy.

You forget our Constitution's original tax plan, as intended by its framers, was to raise Congress' primary revenue from imposts, duties, and excise taxes on consumption. The direct tax was only to be used to extinguish and annual deficit, or if an emergency arose.

At least learn the founder's plan before talking about it.


JWK

Originally Posted by johnwk

That is not true.

Quoting from your quote:
" and not a single state had paid the quota required of her."
That's the same complaint about the United Nations!

Originally Posted by johnwk

And there is no flaw in the founder's agree upon rule for direct taxation and representation, both to be based upon population which boils down to an equal per capita tax if laid directly upon the people.

Again, a direct tax per capita means higher taxation in low income states, based on the percentage of income, versus lower taxation in high income states, based on percentage of income!

Originally Posted by johnwk

I see nothing wrong with "representation with a proportion financial obligation".

But I do!