Talk:FairTax/Archive 6

message: why is the criticism of this radical tax shift SO minutely covered in the article, when it is NOT minute in the world of economics and politics?
This article is one long, very clear, very biased, yet intelligently argued, argument for the "fair tax".  It is not an article discussing the argument for fair tax, and its counter arguments.  it is, essentially, a partisan article.
This needs to be fixed.  —Preceding unsigned comment added by 64.229.31.198 (talk) 06:07, 29 November 2007 (UTC)
replies: text: There is criticism throughout the article.  If there is criticism for a particular area that is missing and you have a reliable source for it, then please present it and we'll consider inclusion. Morphh  (talk) 14:02, 29 November 2007 (UTC)
thread_title: No criticism?

message: I have never been so disappointed in Wikipedia or its peer review process. To award "featured article" status to this piece is to overlook, and implicitly sanction, its many biases, as well as its intellectual deficiencies (for one, as others have pointed out, there are far too many bold claims with citations to op-ed pieces). I made a few small corrections in the introductory section in order to try to introduce a little more balance in the language of the article. (E.g.: the tax proposals defenders included "many mainstream economists and tax experts"--alert, weasel words!--whereas the opponents were nothing more than "critics.")
I would very much like to point to one salient deficiency that I was not able to correct, short of deleting an entire passage. The problem is this: at the end of the second paragraph, broad arguments in favor of consumption taxes in general are introduced, while the rebuttal is only addressed to certain operational limitations in collecting this particular tax. Of course the argument between consumption and income taxes is broad and far-ranging, and in not recognizing the breadth of this argument, particularly from the point of view of the critics of consumption taxes, this article gives short shrift to the intellectual weight of the opponents of this tax.
Finally I would like to see a heading on controversy over the very name of this tax, which was obviously a PR move from the start. This may be what the tax is called from the point of view of its supporters, but its hardly a title worthy of entering into serious intellectual debate. Good grief indeed.Right honorable dr. zombie (talk) 20:58, 28 November 2007 (UTC)
replies: text: The statement of "many mainstream economists and tax experts" is a direct statement from Money Magazine, so it is not a weasel word.  Nothing more than "critics"?  What is the definition of "critic"?  Seems you take this as some derogatory term or something.  Keep in mind that this is only a summary of the article.  If you have sources for more general opponent arguments for a sales tax that can easily be seen as applying to the FairTax, the I have no problem with including them in the appropriate section.  Some of the changes are inaccurate, such as saying it "would" make it highly regressive as such is depending on income, spending, and timeline.  So it "could" make it regressive on income, which in itself is a distortion and false use of the term regressive since income is not the tax base but anyway... As far as the name, it is the title of the bill but I'd be fine with making mention of the issue in the second sentence of the legislative section, where we discuss the name.  "Fair" is certainly a subjective term. Morphh  (talk) 14:20, 29 November 2007 (UTC)

text: I'll see what I can dig up on the statistics.  The sources we have are fine for the content for Wikipedia secondary sources, but we can always try to find more sources or direct statements for the content (I'd like to get them as well).  If you have something from the Committee on Ways and Means (like Chris Trowell) that criticizes the FairTax, then that would be fine for sources.  I'm sorry but Amazon book reviews won't cut it (I'm sure this was in jest). :-)  Morphh  (talk) 2:20, 17 July 2007 (UTC)

text: I have no problem with the citation. The Washington Times is legitimate and Bruce Bartlett is fine.  I removed it for undue weight and its placement was deceptive.  It certainly wasn't anything that would go into the lead.  The placement gave the impression that the FairTax movement was led by the Church of Scientology, which it is not.  The statement said "of a few radicals, led by the "church" of Scientology", which I believe he was probably referring to Jack Trotter, Bob McNair, and Leo Linbeck, though I have no idea if they are with the Church.  The idea that the FairTax was led by the CoS was refuted by Linder (also published in the Washington Times).  If we can confirm who Barlett was talking about, we could add it to the AFFT article that discusses these businessmen if you'd like. Morphh  (talk) 16:25, 17 July 2007 (UTC)
thread_title: Economic Effects

message: Recently, user Old Hoss added a couple templates to the article ( that he created and the other  that I had created).  I didn't put it on this article as I did not think the formating fit well and I didn't see that it added anything to this particular article.  I find the template works best in the main articles to help direct to the other related articles, particularly to less known topics but do not find that the reverse is as important.  If it was a smaller article with few images, I could see it fitting well but I think it does more to distract and overload in this FA article.  To the other template, this is a good faith template and I appreciate someone taking the time to do it, but I'm not sure it was necessary - the main articles has sections on each of the things listed with main tags to those sections.  The sub articles have these listed in the See also but I sort of like it on the subs.  Not sure I like it on the main article.  Seems like overload.  Thoughts... Morphh  (talk) 1:51, 10 June 2007 (UTC)
replies: text: I believe I've fixed the formating issues.  However, I'm still not sure I like the  template on the main article - might be confused for a TOC, though I sort of like it on the subarticles.  Thoughts? Morphh  (talk) 1:39, 12 June 2007 (UTC)
replies: text: I edited the template to make it look less like a TOC by adding "FairTax subarticles" above them. Morphh  (talk) 12:46, 12 June 2007 (UTC)
thread_title: Templates

message: I see a discussion above in which it is noted that the IRS would be abolished and replaced by a National Sales Tax Bureau, and administration costs will be reduced by more than 70%.  How exactly are the administration costs for this NSTB being calculated in these studies?  I didn't find this in the article, I apologize if it's already there.  I would imagine it's difficult to classify administration costs before something has begun-- is this being based on other countries' experiences?  Is the IRS being abolished a central part of the Fair Tax plan that absolutely cannot be taken out? Bills always get negotiated and changed before they're passed.  Have any critics of the Fair Tax proposal mentioned the possibility of the IRS remaining (possibly for capital gains taxes or inheritance taxes, maybe as a compromise with Democrats who seem to mostly oppose this bill, to get it passed) and then Americans paying both kinds of taxes? I read a criticism similar to this on another website, which led me here to see if that was a possibility and I found no discussion of this.--Gloriamarie 17:09, 25 June 2007 (UTC)
replies: text: Removing the IRS is central to the FairTax and I don't think it would ever come out of the bill.  This is probably one of the biggest crowd pleasers when politicians promote the bill.  I have not heard of anyone arguing to keep the IRS.  I'm sure it will be debated but Wikipedia should not speculate on changes that could be made - Wikipedia is not a crystal ball.  Criticism regarding the IRS has been that the FairTax just renames it - That the NSTB is the IRS with a new name arguing that any federal tax agency consitutes the "IRS".  But the legislation does elliminate the agency and has them destroy all income tax records.  The NSTB would be much smaller as it only needs to administer and provide oversite to the states (and collect other taxes that are not repealed such as excise). Here is the Beacon Hill study - you might be able to understand it in all that math. Paying both the FairTax and some form of income taxation is discussed in relation to repealing the 16th Amendment. Morphh  (talk) 20:24, 25 June 2007 (UTC)
thread_title: Abolition of IRS

message: I saw it argued earlier that it's questionable whether or not the FairTax would be revenue neutral. Given that there is a broader base (whether or not many drug dealers will buy used), that the cost of compliance which is very high and increasing  would  be greatly reduced. Trillions of dollars which are out of country (estimated to be  at 11 trillion) will become repatriated, according to Greenspan, within a few months. That money will most likely be invested or spent. 
It may be that the people who are most against the Fair Tax are CPA,s many of whom will lose their jobs.
It could be argued, given the above, that it will make it easier to fund SS, Medicare, Medicaid, and so forth. It has been argued that it will be harder for politicians to spend necessary monies. Brian Pearson 01:38, 29 July 2007 (UTC)
replies: text: Brian, I'm not sure I understand your question.  Morphh  (talk) 13:00, 30 July 2007 (UTC)
replies: text: I'm not sure it turned out to be a question, but I was suggesting that if the Fair Tax were not revenue neutral -- that if we took in more than the current tax system -- it wouldn't be a bad thing at least temporarily. It could be adjusted down, later. Brian Pearson 16:14, 30 July 2007 (UTC)

text: Seems to me it would be more streamlined. With less waste and less cost, plus what I mentioned earlier -- 11 trillion dollars returning to the country -- why wouldn't it be more than enough? I'm not worried about the country. Brian Pearson 22:17, 30 July 2007 (UTC)
replies: text: Yes, what you mentioned would fall under economic growth, which has not been factored into any of the rate studies.  They were all static as oppose to a dynamic scoring analysis.  Most economists and tax experts believe there would be positive economic growth from a consumption tax and removing taxes from business.  However, the studies have not include evasion - so this is one of those aspects (along with a few others) that proponents feel would balance out.  In the long run (5 years out), I think even the most pessimistic studies show economic growth.  It is believed that a consumption tax will provide a much stronger base as the baby boomer's move out of the workforce but continue to consume (taxation of wealth shown in Kotlikoff's studies).  From the CPA's that I've spoken with, I haven't met one that was fearful of their job.  Many thought it would favor them as they could focus on other areas (savings, investment, business) rather then taxes.  The southeast director of Americans for Fair Taxation (Phil Hinson) is a CPA (GeorgiaTex has spoken with him).  Morphh  (talk) 0:59, 31 July 2007 (UTC)
replies: text: It is good to hear that CPA's won't be losing their jobs. I also would agree that though there may be some evasion, it won't be significant. I do think there would be growth but I think there'll be a nice kick at the beginning, over and beyond what is expected from lower prices and the like. I'm very glad to see your input on this. Brian Pearson 04:29, 31 July 2007 (UTC)

text: I was just re-reading the article. Under Distribution of FairTax burden I noticed that virtually all studies ignored one factor or another. Particularly interesting was the Treasury Department's refusal to disclose their figures and methodology. I wonder if the latter could provide an opportunity to take advantage of the Freedom of Information Act. Brian Pearson 00:11, 5 August 2007 (UTC)
replies: text: Yes - I know Kotlikoff has requested it many times and has discussed using the Freedom of Information Act to try and get the methodology.  He is quite certain they botched it up pretty bad to get such numbers.  I'm sure it is being pursued by AFFT.  If you think about it... they got a 25% rate (inclusive on income taxes alone, which is half the income tax base) so it would be something like 50% to cover all taxes.  Exclusively that would be 100%.  So if we're really taxed at almost 100% on all consumption (most of GDP), then we have some very serious tax visibility issues. Morphh  (talk) 0:29, 05 August 2007 (UTC)
thread_title:  Revenue neutral question 

message: Reub2000, I don't agree that this is significant enough to recieve its own section.  Could you explain why you think an article of this size and with the different areas it covers, that we should devote a section to three sentences on the 2008 election candidates?  Morphh  (talk) 10:58, 03 August 2007 (UTC)
replies: text: You do have a point. I wanted to separate the 3 sentences from the legislative history, because I don't consider support during a campaign as part of it's legislative history. Reub2000 06:23, 4 August 2007 (UTC)
replies: text: I've tried to work this into the lead and the section on Grassroots.  I've removed the header but left the statement as a separate paragraph.  Morphh  (talk) 11:46, 04 August 2007 (UTC)
thread_title: 2008 presidential election

message: Does anyone have any good information or sources on the FairTax tent at the Ames Straw Poll? Any good pictures that could be included in the article?Reub2000 07:51, 13 August 2007 (UTC)
thread_title:  Ames Straw Poll 

message: I'm not clear on why the FT would have to increase the tax in order to make up for tax revenue from the AMT. I went to the AMT site and got even more confused when I learned that there was an AMT for companies as well as individuals. Also there were several alternative ways suggested about dealing with problems with the AMT.
Anyway, we are talking about two different tax bases, here, when talking about evasion -- There's already a certain percentage of evasion with the current tax, and it's probably higher than what the FT would see, IMO. That there are two tax bases also applies to the AMT. Does Gale use the GDP as a guide?
Is all of this clear to ya'll? If so, it may be that many of you are already experts in economics and tax theory, or have done a lot more study compared to the casual reader. Brian Pearson 23:52, 17 August 2007 (UTC)
replies: text: Well, it is my understanding that the AMT provides a steady tax increase every year.  So each year the current tax base gets larger (since the AMT has little decutions or exemptions) and collects more as a percentage.  In Gale's revnue neutral study, if you calculate in a static way the tax rate for each year for the next 10 years, your going to end up with an increased rate every year because it has to make up for replacing the AMT tax increase that is projected.  Of course no one expects we'll have the AMT over this time period as both parties seem to be in agreement that something needs to be done, but Gale calculated for it.  The only thing that bothers me is that the ten year figure is the one that is often quoted without any qualification.  Of course the 10 year period is very speculative and does not take into account any economic effects.  I don't know what he uses as a guide.  Morphh  (talk) 12:41, 18 August 2007 (UTC)
replies: text: Yes, I think he is assuming we'll need the increase whether we keep the old system or go to the FairTax. BTW, I remember reading that it would be easier to keep the AMT -- using it as a base to work on -- and get rid of the rest of the current income tax. They'd have to tinker with the AMT. Brian Pearson 22:43, 18 August 2007 (UTC)
thread_title:  Gales comments on AMT 

message: I've been thinking about the book cover that is the main image of the article since fair use was brought up at the FAR.  I think I've addressed the fair use issues that were brought up, but this got me thinking a little more.  In the past, the image has been brought up as a bias advertisement for the book and Boortz.  I've argued that it is the most widely known image of the FairTax issue, since the book was a NYT bestseller and concensus was to keep.  At the time, it was a good image for the top right corner as we had nothing else.  However, now we have the U.S. taxation template that could serve as some article decoration and we provide a wikilink to the book (which didn't exist in the past).  So to get to my question, what are the thoughts on this image?  Does it give the first impression of bias?  Does it add anything to the article anymore?  Would the article be better with it or without it?  Thanks Morphh  (talk) 14:39, 21 August 2007 (UTC)
replies: text: I think it's perfectly valid to have it there...but that it will cause claims of bias for as long as it is. I just had a quick look at the article with the template alone, and it's not bad, but not great either. Ideally, some other decent main image could be used...but there isn't one (unless we use a photo of the bill itself, or something, but that's rather boring). I think my conclusion is one of indecision, which isn't much help :) J.Winklethorpe
talk 17:19, 21 August 2007 (UTC)

text: I bought that book when it was on the NYT best seller list.  I was already a supporter of the Fair Tax Act.  I really didn't care for the book and hated that image.  To me it makes the claim we are not going to be enforcing tax collection any longer, but then we find that we are going to be enforcing tax collection, which makes the thing sound like a scam.  I say get rid of it.--I Use Dial 10:11, 25 August 2007 (UTC)
replies: text: I didn't have a negative view of the image, either for the book or the article. Nor did I have the connotation that the FairTax was a scam, certainly not because there's an enforcement aspect to it. Brian Pearson 02:04, 29 August 2007 (UTC)
thread_title: Book cover

message: Is this tax really progressive? Rebates are not truly progressive since not all people apply for them and they don't really directly correlate with increases in income.
Charles Carroll 01:52, 18 September 2007 (UTC)
replies: text: Any citizen that wants the rebate can get it (which I'm sure all low and middle income families will), so I don't see that as a point of contention.  There are many options in economics that could make a tax progressive besides a stepped marginal rate on income.  Flat taxes often exempt a certain amount of income to make a plan progressive.  Progressive essentially means a tax imposed so that the effective tax rate increases as the amount to which the rate is applied increases (the rich pay a larger effective percentage).  Effective rates are determined when all other government tax offsets or payments are included (which includes the rebate), divided by the tax base. As far as directly correlating with increases in income - you are correct here.. however, you are defining a consumption base tax and using income as your base of reference, which is an arbitrary correlation.  You use a consumption base in determining the effective rate (not income).  Correlating to income is playing with the definition by defining the base to something other than the tax base.  If you hear a regressive statement by an economist such as William Gale, he'll say something specific like "the percentage of income taxed is regressive", which is pseudo-accurate as he defined the base.  So comes the conflict in definition - regressive on income or progressive on consumption.  What is more accurate, a better indicator, and what does it mean?  You could be taxed on 100% of your income (regressive on income) but pay an effective rate of 0% after the rebate (progressive on consumption).  Using income as the base also assumes a cross section time, so the assumption that you never spend any savings.  Income also is limited as a measurement as it doesn't include wealth.  The progressive / regressive point is debatable and is discussed in the section Distribution of tax burden and in more detail under the sub-article in the section Progressive / regressive debate.  In this article, we define the base being referenced and present both views. Morphh  (talk) 13:26, 18 September 2007 (UTC)
thread_title:  Sales Tax Not Progressive 

message: There are three cites supporting the $1 to $3 trillion dollar shadow economy . The first link may have changed, since there is no mention of the underground economy. The second one suggests a figure close to $1 trillion, so I'm guessing the third one -- a paper source -- has a figure for the $3 trillion? Brian Pearson 13:09, 31 October 2007 (UTC)
replies: text: I updated the link to the first ref, which states $3 trillion.  The third ref, the book, uses a percentage of GDP to state the underground economy, which I think also calculates to $3 trillion.  Morphh  (talk) 15:49, 31 October 2007 (UTC)
replies: text: Thanks! My problem now is figuring out why I was looking at that stuff... Brian Pearson 00:31, 1 November 2007 (UTC)
thread_title:  re Effects on tax code comliance 

message: This entry was added and I object to the conclusion presented in the statement.
:An article in The Economist on Mike Huckabee condemned the Fair Tax as "horribly regressive" and called it a "non-starter"., for that and other reasons.
The article does not condemn the Fair Tax as "horribly regressive".  It is making a statement about a sales tax with a 30% rate being horribly regressive, which both proponents and opponents agree.  The next statement is that "Mr Huckabee says he can solve that problem by giving monthly rebate cheques to those who need them."  Not sure what the "those who need them" bit is about - an inaccuracy.  Also, the next sentence is completely false - "But to track Americans' income month by month would require a bureaucracy nearly as intrusive as the one Mr Huckabee hopes to abolish by repealing the income tax."  Who the heck is tracking income - this is completely false and based on the prior inaccuracy.  No wonder it's a "non-starter", the author doesn't know what the heck he's talking about.  But anyway.. I don't see that it states the conclusion being presented here.  A 30% sales tax is "horribly regressive" but then it goes on to mention the difference with the FairTax, of which it does not comment on regressivity.  Morphh  (talk) 14:38, 29 November 2007 (UTC)
replies: text: They're laying out the plan - "he proposes a federal sales tax".. "Calculated the way sales taxes usually are, the rate would have to be at least 30% and possibly much higher. This would be horribly regressive."  True and True "Mr Huckabee says he can solve that problem by giving monthly rebate cheques".. The first statement does not include the aspect of "rebate cheques" as they are setting up the aspect of the plan that is intented to make the plan progressive.  They are discussing a federal sales tax at a rate of 30%, being regressive but Huckabee (the FairTax) can solve that problem with rebate cheques.  They don't say "the FairTax" and they don't say "Huckabee's plan".  They say "this" refering to a 30% federal sales tax, and then go into the rest of the plan ment to address regressivity.  I don't see that the article supports the statement. If you did happen to take it to mean the FairTax, then the statement would be false as they don't specify the tax base (ment to change it from the normal definition).  Even in the case of specifying an income base, such is dependent on spending, income, and timelines examined (the assumption that savings is never spent).  Now if you want to say that a sales thx at 30% is horribly regressive, I have no issue but that is already stated in the article.  With all the facts they got wrong in that small paragraph, I'm not sure we should even consider this source as reliable.  They offer nothing in regard to the statements.  Seems like inaccurate pot shots, with "sound bite" quality.  Not sure that it is in the best interest of an encyclopedia.  Morphh  (talk) 15:30, 29 November 2007 (UTC)
thread_title: Economist article

message: I am wondering why the article doesn't include a per person required expenditure in the article.
Current annual government spending:  about $2.5 trillion.  Annual cost of prebate: about $0.5 trillion.  Total annual government spending under Fairtax: about $3 trillion.
Since there are approximately 100 million families in the US, that works out to a tax obligation of approximately $30,000 per family per year.
That would require an annual taxable per-family expenditure of approximately $130,000 per year.  ($130,000 x .23% = $30,000). And, of course, since many expenditures are not taxed, (i.e., used cars, existing homes, foreign travel, business expenditures, education) that probably translates to an actual required expenditure per family of around $260,000.
I think this would be useful information to include in the article.  Particularly since the census bureau reports that the average income per family is about $60,000.
Just a thought. 63.166.114.11 00:18, 1 December 2007 (UTC)
replies: text: Do you a source for the study?  I'm not entirely sure what it is trying to say.. is this an opponent argument for revenue neutrality?  Since taxable income is a smaller base then the FairTax's consumption, this would show a higher income or tax rate under the current system.  This also does not consider foreign visitors and such.  If you have a reliable source that states this, I'll take a look and see how we can include it.  Morphh  (talk) 13:44, 02 December 2007 (UTC)

text: I understand what you're saying and I agree that normal math would not need a source.  However, this is math that could include many variables that are not considered here (such as including the debt, visitors, etc.).  We are also drawing conclusions to back up a position, otherwise the math is meaningless.  If you don't consider the FairTax component, the argument could still be made that it is impossible to collect $3.2 trillion when the mean family income is around $60,000.  Very odd indeed.. where do we get all that consumption?  Interesting question aside, Wikipedia has a policy called no original research, which refers to unpublished facts, arguments, concepts, statements, or theories. The term also applies to any unpublished analysis or synthesis of published material that appears to advance a position.  This would fall under that policy as it tries to use facts to make an unpublished argument using a synthesis of published material.  I do like the argument though - nice one.  I'd like to see it posted to one of the groups.. let me know if you do. :-)  Although, it somehow reminds me of that riddle where three guys pay $10 each for a hotel and the bell boy gives back $5, which asks the end question of "where's the missing dollar"?  Morphh  (talk) 19:30, 03 December 2007 (UTC)
replies: text: After thinking about this last night, Government and Business also have final consumption.  Also if you took the tax base of 9.7 trillion and divided it by the families, it would be lower then what was presented above.  This would also exclude foriegn, with is about 1/7th the base - 50 million.  So if you took that tax base with both families, gov, and business... it would be lower.  Anyway.. if revenue neutrality were that easy, it wouldn't be debated.  Morphh  (talk) 14:22, 04 December 2007 (UTC)
thread_title: Per Person Expenditures