Tuesday, August 3, 2004
 TAX REFORM ... FINALLY?
I'm certainly not holding my breath here, but House Speaker Dennis Hastert is
indicating that Republicans will put tax reform --- complete tax reform --- on
the front burner next year. Those of you who listen to me know that I am a
long-time supporter of the idea of replacing the federal income tax with a
national retail sales tax. It is the ONLY tax reform plan out there that
allows for the complete removal of the IRS from the national landscape and for
the complete elimination of the income tax.
It just happens that I'm toying with the idea of a book on the Fair Tax
plan. Now seems to be as good a time as any to run just one chapter by
you. Here's a chapter entitled "But What About the Poor?"
Let me know what you think.
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BUT WHAT ABOUT THE POOR*?
OK ... let's put on our sensitivity hats for a few minutes here and
think of the consequences of the Fair Tax Act on our nation's poor,
poor, pitiful poor. After all, they can hardly afford a 23% sales
tax when they're living paycheck-to-paycheck in the first place,
right? We're actually going to forget, just for now, that poverty
is largely a behavioral disorder and consider how they would survive
under the fair tax.
We begin with a reality check. Right now, for the most part,
those whom we define as "poor" aren't paying any income tax
anyway. In fact, many of them are getting checks from the
government. The absurdly named Earned Income Tax Credit, for
example. So right now the government is actually supplementing their
income. How can they endure a 23% sales tax?
The implementation of the Fair Tax would fail in short order if, as
the question presupposes, the net effect on the poor would be the that
they would be paying today's prices for a gallon of milk or a loaf of
bread, plus a 23% sales tax. But ... that would be far from
the reality under the Fair Tax. Under the Fair Tax the poor won't
only survive, they'll positively thrive! The Fair Tax could turn
out to be the best poverty-fighting tool devised in this country since
the concept of hard work.
Let's begin by considering two realities.
First, remember, please, that the poor, along with everybody else,
will no longer have Social Security taxes or Medicare taxes withheld
from their paychecks. Whatever they earn, they get on
payday. For most of them this means an immediate 10 to 15%
increase in their earnings.
Second. Don't forget the 22% in imbedded taxes.
It's lurking there in virtually everything poor Americans have to
buy. As soon as the competitive forces of the free market work
their magic these people will be paying 20% or more less for virtually
retail purchase, including the basics of food, clothing, shelter and
transportation. Yes .. they'll have to pay the new national sales
tax, but when you factor in the lower prices caused by the disappearance
of the embedded taxes you'll see that the total price paid for consumer
goods will remain very nearly the same.
So ... just considering these factors, the Fair Tax delivers a
winning hand to people living in or near to what we call poverty.
They get every penny they earn on payday, and when you factor in the
Fair Tax and the lower prices, they're actually spending less of their
money for a retail purchase than before.
Pull out the calculators. Say that a single mother with two
children spends $45 a week on groceries. The removal of the 22%
embedded tax would bring the price of those groceries down to
$35.10. The sales tax would be $8.07. This brings the total
price to $43.17. That's less than would have paid under today's
tax system. This single mother, whom we'll consider
"poor," has just received a 10% to 15% increase in her weekly
paychecks, and she's paying less at the grocery story for her basic
necessities.
Well, at this point you should be thoroughly convinced that the Fair
Tax would actually benefit, rather than harm the poor. But, then
again, maybe not. So, here's the clincher.
The Rebate
Under the Fair Tax plan every consumer will receive a check from the
federal government every single month equal to the sales tax that person
would be expected to pay on the purchase of the basic necessities of
life for that month. The size of the monthly payment will be based
on the government's published poverty levels for various sized
households.
Here's an example of how the rebate payments would have worked in
2003.
Let's say you're a married couple with two children. The
Fair Tax Act sets forth a formula for computing the poverty level, based
on government figures, which negates any marriage penalty. Under
the Fair Tax Act in 2003 you would have been granted an annual
consumption allowance of $24,240. This is what the government
would assume you would have to spend during that one year to buy the
basic necessities of life for your family. The sales tax on this
amount would equal $5,575. The government will rebate this amount
to you in 12 equal monthly installments of $465. What about a
single woman with one child? Her monthly rebate in 2003 would have
been $232. The lowest payment would be to a single person with no
dependents. That person would receive $172 per month.
Now ... bear in mind, this rebate isn't only paid to the poor.
It is paid to everyone, rich and poor alike. The purpose here is
to make sure that no American has to pay the Fair Tax sales tax on the
basic necessities of life. Unlike the present income tax system,
the Fair Tax treats each and every person in this country exactly the
same. This, of course, presents somewhat of a problem to
politicians who like to use the tax code to foment class distrust or
outright warfare.
OK ... let's add it up for America's lower income citizens:
- They get their entire paycheck.
- Even with the sales tax, and considering the drop in prices,
they'll be paying essentially the same for everything they buy.
- They get a check from the federal government every month to rebate
any sales taxes they had to pay.
Though their tax returns aren't that complex, let's also
include the time these the poor (all of us, really) will save by not
having to keep tax records or file tax returns.
So, my friends, if you're looking for some reason to oppose the Fair
Tax plan, you're going to have to find a better excuse than its effect
on the poor.
*Please note that I titled this chapter "But what about the
poor?" and not "But what about the less-fortunate?"
Look, I can't be expected to write this entire book without getting in a
few digs at the language of political correctness, can I? To say
that the poor are poor because of a lack of good fortune presupposes
that those who aren't poor were just lucky. Sorry, but for the
vast majority the benefits of an affluent lifestyle aren't a matter of
luck, they're the result of attention to education, hard work and good
decision making. Luck counts on the Las Vegas Strip, not Main
Street.
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AL QAEDA PLANS FOUR YEARS OLD?
Some news outlets are reporting this morning that those newly-discovered al
Qaeda plans to blow up some New York and Washington office buildings may be as
much as four years old. If that's the case, the Democrats now have some
new ammunition for their charge that yesterday's terror alert was politically
motivated. We'll watch this one.
sKERRY SAYS BUSH MAKES TERRORISTS MAD
Yesterday, campaigning in Michigan, The Poodle accused President Bush of
encouraging terrorist recruitment with policies that have made the world angry
at the United States. So ... Kerry thinks that fighting terrorists makes
them mad. Wow! I guess we would be a lot better off appeasing them,
wouldn't we? Where was Kerry when we needed him in World War II? If
we had just not fought back against the Germans and the Japanese who knows how
many American lives we would have saved!
The Poodle also said Bush hasn't reached out to other countries and the Muslim
community. What is he talking about? Does he not count Saudi Arabia,
Kuwait, Jordan, Turkey and Qatar as Muslim countries? What about Great
Britain, Australia and Poland? Did we not reach out to those
countries? Oh yeah...I get it. Just because Russia, France and
Germany aren't on board with Iraq, we haven't "reached out" to
them. I guess we're also supposed to reach out to terrorist regimes like
Iran and Syria.
Then, unbelievably, Kerry's spokesperson said "It was not a mistake to
remove Saddam," it was just a mistake to do it the way George Bush did
it. When is John Kerry going to tell us just how HE would have done
it? The Poodle continues to want it both ways...he's for the war, but he
would have done it better, and had it been him in charge, he - and only he -
could have reached out to the magical 'foreign leaders' to get more support.
Don't forget that both Johns voted for the war in Iraq.
THE POODLE'S NEW BOOK
 The Kerry/Edwards campaign is releasing a new book. It is 250 pages long
(don't worry, apparently it has lots of pictures, so those of you 'educated' in
government schools should be able to read it.) In it, The Poodle fleshes
out his campaign proposals of what he would do, should he be elected (let's hope
not.)
The first chapter apparently is about his plans to stop terrorism and and
improve domestic security. It's probably more of the same garbage we've
heard thus far, which seems to be a policy of appeasement. You see,
Islamic terrorists are really good, misunderstood people. If only we would
reach out to them, then we could better understand their grievances, and resolve
our differences with them. That's the way these leftists think....they
don't believe as George Bush does, that Islamic terrorists are a cancer on the
Earth that should be destroyed.
The Poodle is also making a big deal out of embracing all of the recommendations
of the 9/11 Commission. Sorry, but more government bureaucracy wouldn't
have stopped the attacks on 9/11 and it isn't going to stop any attacks now.
The only way to fight terrorism is to attack and destroy them until they either
abandon their plans or there aren't enough left to implement them.
Why is that so hard for some people to understand?
FOUR MORE YEARS OF HELL? SIGN ME UP
The Poodle and his Keeper were speaking at a campaign stop in Milwaukee, when
some Bush supporters showed up with a megaphone and started shouting 'four more
years!' into it. Well, as you can imagine, the Kerry campaign didn't like
this one bit. The Poodle himself said "I would like to thank George
Bush for sending the goons here tonight to excite us to do a little more
work." Whatever.
What was more interesting was what his Keeper, Tereeeeeeeeeeeeeza Heinz Kerry
had to say when introducing her husband: "They want four more years of
hell," said her Highness. Four more years of hell? You
bet. Sign me up.
Four more years of hunting down bloodthirsty Islamic terrorists and making them
pay with their lives, four more years of tax cuts that give people back more of
their hard-earned money, four more years of the same economic growth we are
currently experiencing.....sounds peachy to me.
For the left to be successful, they have to sell this notion of doom and
gloom...where everybody is doing without and they need the heavy hand of
government to help them.
I thought The Poodle said he was going to run and optimistic campaign? I
guess not.
BUT PAUL REVERE SAID "NO."
Boston has quite a number of character actors who earn a living playing the
role of revolutionary Americans. Last week Democratic conventioneers hired
some of these actors for their parties and for other purposes? Other
purposes? Well ... for example, one advocacy group tried to hire the guy who
plays Paul Revere. They wanted him to ride through the streets of Boston
around the convention center yelling "The assault weapons are coming!
The assault weapons are coming!" Thankfully, he said no.
Clever people, those anti-Second Amendment types, don't you think?
COME ON NOW ... AREN'T YOU EMBARRASSED?
You're driving down the street in your Ford Explorer or your five-year-old
Olds. You cruise to a stop at the traffic light. As you sit there at
that traffic light those gleaming chrome rims on your car just keep on
spinning. Yup! You have Sprewells! You notice that people are
looking at you, and you sort of lift your head and puff out your chest a
bit. You're cool! You're hot! Your spinnin' Sprewells are telling
the 'hood that you're the baddest of the bad.
Sorry .. you have this just a bit wrong here. Yes, people are staring
at you; but they're not staring at you because they're impressed. They're
not staring because you are cool beyond all reason and they just really want to
be you at that very moment. They're staring at you in amazement because
they really can't bring themselves to believe how incredibly stupid you
are!
Those people gawking at you know what you paid for those symbols of
ignorance. What was it? Twelve thousand? Fifteen
thousand? More? Car dealers just love idiots like you. If your
ride is new the dealer probably made about $1,500 on the sale of the car, and
another $5,000 on the rims. He was watching you go as you drove off the
lot thinking "What an idiot. As long as there are fools like that out
there I'll never go broke." Tell me ... you went to that particular
dealer in the first place because he was running a TV ad which said "all
credit applications accepted," didn't you!
So ... go ahead and strut. We're getting a big kick watching your
bad selves run around town with those spinning symbols of ignorance. Good
show!
GUEST TODAY
Today at 11AM ET Neal will talk with Donald Rumsfeld.
Seen on Wisconsin Highway 38. Submitted by Don.
READING ASSIGNMENTS
The
journalist that The Poodle's keeper told to 'shove it' is still suffering
from the Democratic Attack Machine. He correctly points out that she still
didn't answer his question.
Speaker
of the House Dennis Hastert says Bush has a secret plan to end the income
tax in his second term....if it's true, he should be talking about it now.
House Democratic Leader Nancy
Pelosi has met with a group tied to Hamas....looks like the terrorists have
a friend in the Democratic leadership.
Nancy
Reagan has endorsed George Bush for re-election...so much for the Democrats'
dream that somehow because of Ron Jr., the Reagan family was backing The Poodle.
Looks like the Democratic National Convention
not only did not help The Soufflé, but actually helped Bush! The left
may just give up over this one.
Kerry feels entitled to the presidency, but hasn't done anything in his twenty
years in the Senate to really earn it. William
Kristol has more.
The networks are already showing their bias: they think the terror alerts are
nothing more than the Bush administration playing politics. The
Media Research Center is there.
Al Sharpton is a good fit for Democrats....he believes people need the heavy
hand of government to achieve anything, says
Star Parker.
The speech given in prime time by a 12-year-old at the Democratic Convention was
telling...liberals don't like to distinguish between adults and children. Dennis
Prager fills us in.
Everybody gets a bounce out of their political convention....even candidates
that are big losers. But
not The Poodle, says Joel Mowbray.
John Kerry seems to be telling people not to judge him by his actions, but by
what he is telling us right now. David
Limbaugh tackles the Poodle's acceptance speech.
Thomas Sowell talks about the lawsuit lottery -- class action lawsuits where
the lawyers get rich and everybody else gets the shaft.
Why is the Hildabeast so popular? Matt
Towery says she could've easily beat Bush this year, and there's no way she
wants the Johns to win.
Frenchman crowned world champion snail spitter.
Take a peek inside Belinda's house, the kitchen to be specific, without being arrested.
Atlanta area listeners, Neal judges the final show of Gimme the Mic Aug. 3 at 8 p.m. on WSB-TV Channel 2. |
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