| PookyNMR wrote on Wed, 19 December 2007 09:25 |
I dislike the lack of a social system that Ron Paul is advocating. However, I do like his ideas on foreign policy, fiscal policy, and sticking to the constitution.
IMHO, whether or not you agree with him, he's one of the much better thought out candidates.
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He is consistent with his arguments, and I know that appeals to a lot of people.
I suspect that his beliefs in limited (read: non-existent) government are rooted in his rural background, where the population is thin and the services a government might provide aren't strictly necessary. In other words, if you want a road, you build it; if you want water, you dig a well.
Contrast that with urban populations, where infrastructure requirements necessitate a government that can impose order.
Put simply, what works for Ron Paul out in the sticks simply won't work in urban areas, and the suburban and exurban areas whose residents commute to those cities.
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A kid (27) here at work, who always wears Bob Marley t-shirts, was ranting in support of Ron Paul yesterday. He likes Paul's position regarding the war in Iraq (and frankly, who doesn't?) but he also believes in the idea of abolishing the IRS and replacing the income tax with a sales tax.
Arguments about the sales tax' regressiveness falls on deaf ears. He even spouted the line about "if we get rid of the IRS, all of that bureaucracy is eliminated!" Of course he forgets that an agency will be needed to implement and enforce the sales tax. Even worse is the proposal for some sort of tax rebate for low-income citizens, which will require even more red tape. Naturally other exceptions will turn up and basically you end up back where you were.
Nobody in the Fair Tax game mentions the extra burden placed on all retail businesses, who will be responsible for collecting and remitting the sales tax. Already they complain about the possibility of sales taxes on Internet purchases; this will force that to happen and will be far worse. Also, will business-to-business transactions be taxed at the same rates as consumer purchases? Will resellers and OEMs still be able to get a sales-tax exemption?
My co-worker also argues that if you eliminate the income tax, all of the things it funds (by which he means the war) will have to stop, but of course he ignores the fact that whether the tax comes from your paycheck or at point-of-purchase, money still flows to the government coffers where it will still be spent on things with which one doesn't agree.
Finally, there's the very real concern that a sales tax would put a huge wet blanket on our consumer-driven economy. While most people look at their pay stub and go, "Where did all that money go?" I think that seeing a 35% or 40% sales tax* on every purchase will send a real shock through the consumer mind. That flat-screen HDTV was almost OK at $1000 but what about at $1400? The $20k vehicle was affordable but $28k is not. Will a bank lend the extra $8k? In case of losses, will insurance cover the vehicle at $20k or $28k?
Certainly, consumers will have more money in their pockets at every pay period because no taxes are deducted. But that won't mitigate the shock of a substantial increase in the cost of consumer products.
Suffice it to say that if consumer spending is reduced then our economy is well and truly hosed.
-a
* while the "Fair Tax" proposals seem to talk about tax rates of 23%, most reasonable economists think that number is too low. And don't forget that many jurisdictions already impose a sales tax (8.1% here in the desert). And those jurisdictions that impose an income tax indexed to the federal tax rate (like we do here in the desert) will need likely convert to a sales tax.
