Gravel: Replace IRS With a National Sales Tax.

Austin American-Statesman

 

MANCHESTER, N.H. — The road to Saint Anselm College is marked with long Burma Shave strands of political placards. The name I see most is Biden. But all the Democratic Party candidates for president will be there. A two-hour debate between candidates starts within an hour.

As I approach the campus, I see another kind of sign. It's for an idea, not a candidate. The signs say "FairTax."

That's why I'm here. One of the candidates favors the FairTax. It's the proposal that would abolish the Internal Revenue Service and replace the income, corporate and employment taxes with a single, flat national sales tax.

This is not an idea you hear from Joseph Biden, Hillary Clinton, Christopher Dodd, John Edwards, Dennis Kucinich, Barack Obama or Bill Richardson. They are the conventional candidates to lead the Democratic Party back into the White House.

The FairTax is a major part of the platform of Mike Gravel. He is the darkest horse in the race. He is the Ross Perot of 2008, except that he is running as a Democrat and that CNN paid more attention to Ross Perot than it pays to the former senator from Alaska.

I watch the debate on a large flat-screen TV, sitting high on a gymnasium bleacher bench.

Around me, a group of nearly 20 bloggers taps away on glowing laptops. They have been gathered by CNN to post minute-by-minute commentary during the debate. Major Media wants no more Howard Dean surprises. It is already clear that what might be called "legacy media" will suffer some crowding out by YouTube and the broad assault of Web 2.0.

But that's another story.

The debate tells us that the war in Iraq will be ended quickly if the Democrats take the White House. Only the exact schedule varies. It tells us that the Bush tax cuts will expire. It tells us another major change in health care is coming, one that will combine the ubiquity of government management with the compassion of insurance.

It tells us that energy companies will be punished for raising the price of gasoline and oppressing a nation of innocent SUV drivers. It tells us that 12 million illegal immigrants face years of uncertainty as Democrats declare that there is no opportunity in America while trying to control the unending flow of those crossing our borders to seek it.

Government spending beyond Bush war spending is virtually unmentioned. True government obligations go completely unmentioned. Social Security and Medicare are barely referenced. The dilemma of our young — Generation Debt, as one writer calls it — is mentioned only in relation to education loans.

The debate reminds me of an incident in the Carter era when a newspaper headline accidentally made it to print.

"More mush from the wimp," the headline read.

The darkest horse in the race speaks no mush. Gravel offers a new deal. It is Internet new and Jeffersonian old. It is at once populist and libertarian. The new deal trusts us more and manipulates us less.

Here are the main elements:

•A national initiative much like state referendums to allow Americans to bypass Congress and vote on federal issues, sometimes called the "Let the people decide" movement.

•The FairTax, a national sales tax that would eliminate the wretched tax system we now have and replace it with a single national sales tax. The new tax would be supplemented with a rebate to reduce the burden of the tax on lower income households.

By taxing consumption, rather than just a portion of income, the FairTax would vastly increase the tax base. It would draw significant new revenue from wealthy people who spend their capital on consumption.

•A Social Security fund invested in a low-cost global index fund, not IOUs, which would work as well for young people as for old people.

•Universal health care vouchers that would guarantee health care to all Americans while putting the choice of how it is received back in the hands of the individuals.

These are real ideas, worthy of real debate and offering real change.

I'm ready for it. I'm sending Gravel some money. I hope you do, too.

If we send enough, maybe Wolf Blitzer will give Mike Gravel the time of day.

And that, friends, means we would hear less mush.

Scott Burns

http://www.statesman.com/business/content/business/stories/personalfinance/06/10/10burns.html

Comments

info

http://www.devvy.com/notax.html

If you need all the information on why America does not need an income tax.

Taxing the rich...

I've been thinking about it and I've finally realized that taxing the rich is not the answer. It is just not fair and equal, at all. I've always thought it made since to make them pay more since they make more, but it actually doesn't. Why should the rich be penalized just because they make the most money? They should be punished for it? That's ridiculous. A national sales tax makes much more since. Those that choose to spend more, pay more. If a rich person chooses to save their money rather than spend it then good for them. They deserve the ability to save as much as anyone else. The idea that people will suddenly stop buying things is absolutely ridiculous. This is America, people will always buy things. Even if a rich person chooses to buy cheap items, then they deserve to save the money. Frankly I don't believe they will. People are used to a certain quality of life and they will not change that just because they pay their tax in sale and not income.

FairTax

Those of you with questions or concerns about the FairTax should go to http://www.fairtax.org  They have tons of info there!

Incentives?

I love what Mike has to say and finally I'm excited about a candidate. That said, doesn't the FairTax creative an incentive to *not* spend your money in our markets? Will this tax policy cover foreign purchases, say, made over the internet? Incentive is a powerful tool, and you have to be careful about the incentives that a program creates. The last thing America needs right now is more money flowing to foreign markets.

Please, correct me if this is mistaken.

Federal Sales Tax

Sorry, but about the nicest thing I could say is that sales tax is the most regressive form of tax there is, i.e., everyone pays the same % on a dollar, which takes a proportionately larger bite from low income than high. Now, if it could be added to luxury items (furs, yachts, lux cars, cruises, etc.) only I'd be willing to consider further. 

What the government giveth the government can also taketh away, which makes exceptions changeable from one Congress to the next and far from a sure thing. I agree the IRS is nobody's idea of a good day, but there has to be another way.

You obviously haven't really read the fair tax initiative

It is progressive. Unlike a Sales tax, the Fair Tax has a Rebate that is paid back to all American citizens regardless of income (this greatly reduces the need for a large organization to track who gets it and who doesn't). Now to make it easier for me to figure the math I will use 25% instead of 23% so don't take my numbers literally just go to fairtax.org for more specific example. A tax payer spent 20,000 for the year he/she will have paid 5,000 in taxes and a multi-millionaire spent 2,000,000 for the year he/she will have paid 500,000.

Just for giggles let us say that the Government decided that 20,000 dollars was poverty rebate. Government would give back 25% of 20,000 which is of course $5000 paid over 12 month. So the person making 20,000 would get the 5000 back eventually thus their tax rate would be 0%. On the other, hand the multi-millionaire would get $5000 back, but remember he/she paid 500,000 in taxes. After rebate that comes to $495,000 for the year and if we reverse the math that reduces the millionaire's tax rate to 24.75% - a whopping .25% decrease. whose getting the better tax deal - the 20,000 a year spender. The more you spend the more progressive the tax becomes. The website, fairtax.org, does a heck of a job explaining it - better than myself. Not only is the Fair Tax progressive but used items are not retaxed (in other words there is no tax on used items). This allows the poor to shop frugally thus reducing their tax burden. It is possible that a low income person could make a little extra from the rebate if they buy used items (which a lot of low income people do anyway). Of course the Fair Tax helps to reduce government by eliminating the IRS. Switching to the Fair Tax system might not be easy but change never is but it will be worth it in the long run.

This is a very raw and quick example of how the fair tax works. However, it does illustrate, on a basic level, how it is a Progressive Tax - not Regressive. For a more thorough explanation please visit the Fair Tax website. The other impressive thing about this site is that the group supporting Fair Tax is not afraid to publish the accusations against fair tax right on their website. They often will give rebuttals to these accusations. Its a great website.

I consider myself more conservative than liberal (I have never been hard Left or Right) but Mike Gravel is the first Democrat that has been speaking my language such as: Get us out of Iraq quickly, Fix a broken economic system starting with our crazy Tax system, create a Universal Healthcare system (I like the voucher system - even when the Republicans supported the Education version which was similar but not as broad covering, in other words, less strings attached), and last but not least - better care for Veterans.

 

"The best thing about the future is that it comes only one day at a time."

Abraham Lincoln

Two thumbs up for a consumption based tax

A consumption based tax with a break on essential items is as fair as it gets.  There is no way you are going to come up with a scheme for taking money from the rich and giving it to the poor.  Not only is it impossible to do, but it's not right to attempt it.  With a consumption based tax, the more you spend on things, the more you fund our government.  With essential items getting a break, this gives the poor (who are more likely to only spend on essential items) a break.  For the rich, this gives them incentive to save and invest rather than spend (although I am sure they will still be doing plenty of spending).  We need to do more saving and investing if we are going to dig ourselves out of the financial hole our country has fallen into.  Our current system provides a way for the rich to funnel the tax burden back to the middle class and the IRS is the agency that supports this.  This is not fantasy, this is sound, economic truth.  The main reason this has not changed is there is great wealth behind keeping things the way they are.  If you were rich, would you want things to change?  Of course not.  And who has the most influence?  Since dollars buy influence, that would be the rich.  I was so happy to discover Mike and see a candidate who speaks for the people and common sense, now I just pray that in time enough of us can look past media propaganda (funded by... you guessed it, big money) and vote into office someone like him who would make a big step towards giving this country what it really needs; a way out of the financial and social mess we have gotten ourselves into.

He's saying that EVERYTHING

He's saying that EVERYTHING that is bought gets taxed, NO EXCEPTIONS... cause once you make exceptions rich people exploit the exceptions.

If rich people wanna go to a Harlem grocery store to buy the essentials, then why stop them? Will they do it? No. They will continue to go after their big and expensive things and shops, because even the rich have peer pressure, actually they have more then the middle class do.

With faith, victory is assured.

I read that...

I read that it was "newly manufactured goods and services" which I understood as, second-hand goods would be tax free.

I LIKE MIKE

If you like Mike try posting to http://groups.yahoo.com/group/txfairtax/ .   They have been promoting the FairTax for a very long time.  See if you can get them to send some support our way.

 Hey, that's a pretty good campaign slogan.  "I LIKE MIKE".  Put that on your bumper.

Boston Globe

Hi, this is a great article that also appeared in The Boston Globe. This guy must have some clout. Hopefully, the MG campaign staff will contact him and leverage this supporter.

Ideas are Bulletproof

 

I told my district representative in the house to support the Fair Tax legislation and heard back that he believed American's deserved a fair and simpler tax code, but was concerned the Fair Tax would take away the deductions and things that protect lower income families from taking the brunt of tax burden.

I wasn't sure how to respond at the time, but now I realize, how can this be??

If people are getting to keep their entire pay check, and getting back the amount they pay in sales tax on the basic necessities in a check each month, than they are able to choose in effect to not pay any taxes at all!

(even individuals who are out of work will still get that amount that the average person's is paying in sale's taxes on the basics back each month and have some money flowing in.)

How is this bad for anyone facing hard-times?

Everyone pays by choice (and plenty of people with money to spend will choose to do so, and generate plenty of tax revenue*), so what's the worry?

The only worry I'm aware of is that of the legislative branch being concerned about not having CONTROL over how the taxes are coming from THE PEOPLE'S pockets into their budget.

Hey, maybe there is something I don't know.I'm just not seeing it.

Come on, people are ALWAYS buying. Do they think the marketers are going to suddenly stop doing what their doing? Wrong, they'll be able to offer better prices and put more money into marketing with this setup.

So the career legislators can rest assured. Their budgets not going anywhere.

 

 

 

The Internet is the People's Media. And now it's Our turn to Frame the Conversation.

Finally, somebody trying to solve some problems!

Cheers to you Mr. Gravel!   The Fair Tax and the national referendum concepts are the most exciting ideas we've had in decades for this country!  Thank you for embracing both of them so boldly!  While you're at it, how about a simple concept like a national holiday on election day, so more people will vote!  It's hard to vote on a Tuesday when you've got four kids and a 12 hour work day.  Memorial Day, Independence Day, Labor Day, Election Day..........I wonder if it was put to a national vote, who would vote against this???  probably politicians.....    

EXACTLY!

I have always wondered about that! I mean, so many people work such different hours and all of that... if making it a holiday wouldn't work (because many people still have to work on holidays, my mom was a food server, I know!) and going into teaching I've been told to expect to work from 6 to 6 everyday for at LEAST the first few years. And alot of people don't like going to vote before work because of how long the lines can get. I say as long as you bring in some proof that you were at a voting station doing your civic duty, your employer cannot punish you for tardiness. How about a push in each of the states to make the hours of operation from midnight to midnight? That way, no matter what your schedule is, you can go down and vote!

National Initiative Drumbeat

Right on, Austin American Statesman!

If i may make a suggestion: Mike now that your name is out and known to the cognoscenti, n the time has come to start a drumbeat at the debate for the National Initiative. Why not answer every single question at every debate (for which you get a chance to give an answer) by tying it in to the NID and explaining how your proposal for an NID would help solve the problem addressed by the question? People's attention span is limited and too many mindless candidates are cluttering up the stage at the debates. If viewers of the debates can take away from the debates the short phrase "Mike Gravel=NID=Universal solution to all the problems of bad government", you will have accomplished a whole lot, IMO.

gopher1

An excellent idea!

It may be easier said than done considering how limited the time given for answers is. However, if possible, it would be good to throw into the response the National Initiative as a universal solution to most problems.

The only problem I see with that is some will want more explanation on HOW the National Initiative can do that. And that is not easy to give a sound bite response.

DON

Only democracy will save us!

Simple enough.

If they are interested all they have to do is go to www.NationalInitiative.us .. Mike is always sure to mention it when he talks about the NI... they just need to go to the website.  What I want is a debate where anyone can send a question to the candidates.. Get them all asked what they think about the NI.... Let they speak against it, say how they don't think the American People are fit to decide for themselves and see how much support they lose then... we need to find a way to force that issue.