From: cmk@athena.mit.edu (Charles M Kozierok)
Subject: Re: Death of Canada (Was: Death of America) [long]
Organization: Massachusetts Institute of Technology
Date: Mon, 14 Dec 1992 22:30:26 GMT

In article <1992Dec14.180502.6147@mdivax1.uucp> robinson@mdd.comm.mot.com (Jim Robinson) writes:
>Charles M Kozierok (cmk@athena.mit.edu) wrote:
>
>>i don't know about that. i *do* remember being in ontario and hearing
>>the retailers absolutely SCREAM about the extra cost and red tape required
>>to have two separate taxes on their sales registers and to administer
>>the extra tax.
>
>The provinces can harmonize their PSTs with the GST whenever they want.
>Mostly for political reasons they have chosen not to do so.

ah, but we were discussing Gary's claim that the GST had some beneficial
aspects to retailers. whether it is the federal or provincial governments
that made the retailers lives miserable makes no difference to me, nor
did it to them. i know for a fact that the ontario government made it
*very clear* to ottawa that they would not co-operate, in advance of the
GST.

>> i also remember them worried, justifiably,
>>about consumers choosing to deal with their spending power
>>reduction of 7% (actually 7.5% to be technical) by reducing their
>>spending by a like amount. why do i need to read a book on retail price
>>composition? hardly seems relevant.
>
>If memory serves, the 7% GST is taking in about $18 billion per year. The
>13% (or thereabouts) *hidden* MST used to take in somewhat less (one or two
>billion).

now if that was Gary saying that, i'd not be surprised, because he has done
this once too often. i'll assume you weren't trying to mislead the readers
(as Gary is). if the old tax was $1-2 billion, and the new tax is $18
billion, the old tax did not take in "somewhat less" -- the new tax is
between 800% and 1700% higher than the old tax, depending on if you
use the $2B or $1B figure. and this was my essential point in response
to Gary's lame attempt to justify the GST as a replacement for the MST, 
a line he quoted directly from the government bureaucracy, and dropped
like a hot potato after i forced him to try to defend the math.

>Thus, there was no 7% reduction in purchasing power.

sorry -- you can't refute my argument by redefining the laws of math.
maybe it isn't 7% -- maybe it's 7% times $16 billion over $18 billion.
so? 6%?

>I believe
>that line or reasoning was merely a propaganda ploy exploited by the
>Liberals and the NDP.

the math speaks for itself (not that i support either of those two
abominations): if the government takes in more money, consumers have
less to spend. it's really no more complicated than that.

>IMHO, replacing the MST with the GST was a necessary
>tax update which reflects that changing nature of the post-industrial
>economy.

close. it was necessary to support the federal government's outrageous
social spending agenda. i have already posted numbers to this effect.

>It is also a more "honest" tax in that, unlike the old MST, it is
>not (usually) hidden in the price of the good or service.

i agree with this, except for one thing. the "honesty" part only
applies to the money collected by the new tax which replaces the old.
so the first $2B of the $18B can be attributed to replacing the old
tax. the remaining $16B was a *dishonest* piggyback job.

>That is not to say that Canada is being run in a fiscally responsible
>manner (although is was worse in the last years of Trudeau's government).

that is an astute observation, IMO. he really started this mess, from
what i know.

>However, the GST is probably one of the fiscally sane, although immensely
>unpopular, things that the PCs did. If you want the goodies, you have to
>pay for them, and the GST is a better method of paying for them than the
>MST was.

that's more like it!
"paying for goodies" is right. *not* "reflects the changing nature od
the post-industrial economy".

>The question that still needs to be answered is which goodies
>Canadians are willing to pay for. That question will remain unanswered as
>long as politicians can get away with chronic deficit financing on a
>massive scale.

exactly. and as long as the politicians keep phrasing it as: "well we know
the deficit is a 'challenge', but you don't want to give up any of
your social programs do you? we thought not. oh well, up goes the deficit",
we'll never get anywhere. and the real problem is that the people who
are getting the goodies are not always the ones who are paying for them --
why should they say no?

note to Gary: look above for some more points i have "not made"...

--
charles
Newsgroups: talk.politics.misc