No Personal Tax. Only Consumption Tax

[Steelplate]

Exactly dontbestupid...

This is why Supply Side Economics does not work. You need demand to dictate supply, not the other way around. In order to create demand, you need to cater to the people who buy the products and services that make business owners wealthy. Not pander to the business owner at the expense of the people who buy their products and services.

Trust me... if people have money in their pockets, they will buy. If people buy, businesses make money, if businesses make money there will be more hiring. That's the way you grow an economy.. not give really rich folk more tax breaks and take services away from the people that need it. That's only going to....

A. Encourage Big Business and Wall Street to do even less. I mean, why invest in the country if they don't have to?

B. Put even MORE of a hurting on the working and Middle Class...which will make even MORE of their money unavailable for spending.

It's stupid...

 

[uscitizen]

Less spending and more saving is exactly what we need.

Fascinating rant you had there and I'm sure your Econ teacher loved it. However, we live in the real world and in the real world, businesses are not hiring and not expanding due to low consumer demand. And with 9% unemployment, there is no wonder why we have low consumer demand.

Even less spending by consumers is not what we need.

Faltering consumer spending to weigh on growth | Reuters

The Commerce Department said on Tuesday consumer spending slipped 0.2 percent, the first decline since September 2009, after edging up 0.1 percent in May. Adjusted for inflation, spending was flat after a 0.1 percent decline.

Incomes rose just 0.1 percent.

"If the recovery is ever going to gain speed, it will have to come from households deciding they want to spend money again," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.

There are few signs that consumers are willing to do that just yet. Companies from a wide range of U.S. industries told stories on Tuesday of slowing sales and bleak outlooks.

But don't listen to those businesses or reports. Keep telling yourself even less consumer spending, and therefore less revenue to business, is just what we need more of.

At least another decade of stagnant life in America and more if we do not start doing something right.

 

[uscitizen]

Exactly dontbestupid...

This is why Supply Side Economics does not work. You need demand to dictate supply, not the other way around. In order to create demand, you need to cater to the people who buy the products and services that make business owners wealthy. Not pander to the business owner at the expense of the people who buy their products and services.

Trust me... if people have money in their pockets, they will buy. If people buy, businesses make money, if businesses make money there will be more hiring. That's the way you grow an economy.. not give really rich folk more tax breaks and take services away from the people that need it. That's only going to....

A. Encourage Big Business and Wall Street to do even less. I mean, why invest in the country if they don't have to?

B. Put even MORE of a hurting on the working and Middle Class...which will make even MORE of their money unavailable for spending.

It's stupid...

the law of supply and demand in it's current US form.
Those who have the supply can demand what they want.

 

[ShackledNation]

Less spending and more saving is exactly what we need.

Fascinating rant you had there and I'm sure your Econ teacher loved it. However, we live in the real world and in the real world, businesses are not hiring and not expanding due to low consumer demand. And with 9% unemployment, there is no wonder why we have low consumer demand.

Even less spending by consumers is not what we need.

Faltering consumer spending to weigh on growth | Reuters

The Commerce Department said on Tuesday consumer spending slipped 0.2 percent, the first decline since September 2009, after edging up 0.1 percent in May. Adjusted for inflation, spending was flat after a 0.1 percent decline.

Incomes rose just 0.1 percent.

"If the recovery is ever going to gain speed, it will have to come from households deciding they want to spend money again," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.

There are few signs that consumers are willing to do that just yet. Companies from a wide range of U.S. industries told stories on Tuesday of slowing sales and bleak outlooks.

But don't listen to those businesses or reports. Keep telling yourself even less consumer spending, and therefore less revenue to business, is just what we need more of.

I'm not going to waste my time on you. I put forth a thought out argument, and you respond with ad hominem. You say it is wrong with absolutely no explanation, and then make a claim supported only by opinions of other people who happen to agree with you. Neither you or those other people even attempt to explain why your opinions are correct.

I can't refute your incorrect assumption that falling consumer demand is not the cause of the recession because it would require dismantling so many fallacies that each would require their own topic. If you actually care about understanding where people are coming from and what reality is truly like, you will read this article.

Here is an excerpt from the article.

The consumer-demand theory sounds very appealing at first. If consumers are active, this is said to be a good sign for economic health, if consumers do not spend enough then it is seen as a bad. Surveys of business activity show that during a recession, businesses emphasize lack of consumer demand as the major factor behind their poor performances. This framework regards consumer’s psychological disposition as the driving force of an economy. If consumers are optimistic and happy with the economy, no recession can occur--so it is believed.

In the real world, consumer optimism is important, but by itself it will achieve nothing. Production must precede consumption. It is necessary to produce useful goods that can be exchanged for other goods. Thus when a baker produces bread, he doesn’t produce everything for his own consumption. Most of the bread he produces is exchanged for the goods and services of other producers, implying that through the production of bread the baker exercises his demand for other goods.

To put it differently, his demand is fully covered i.e. funded by the bread that he has produced. Demand therefore, cannot stand by itself and be independent, it is limited by prior production, which serves as means of securing various goods and services. What thwarts individuals' demand for goods and services, is the availability of means to appropriate all the goods and services individuals want.

These means do not spring "out of thin air"; they have to be produced. The production of goods and services is constrained by the real pool of funding: the resource available to provide sustenance to the economic process. The pool of funding is the quantity of goods available in an economy to support future production. If it requires one year of work for a man to build a tool, but he has only enough apples saved to sustain him for one month, then the tool will not be built-and the man will not be able to increase his productivity.

You focus so much on demand and consumption you forget about production. Production is complicated. The structure of production and capital is dependent on time preference. I know plenty about Keynesianism and his ideas, but I doubt you have ever even read a single article about economics from the Austrian perspective. If you want to ignore an entire opinion on economics, fine. Your mind is closed, and discussing anything with you will be fruitless.

 

[uscitizen]

I think a pure flat personal income tax on ALL income with no deductions is the best route.

 

[DontBeStupid]

I'm not going to waste my time on you.

Oh thank god!

I put forth a thought out argument, and you respond with ad hominem. You say it is wrong with absolutely no explanation, and then make a claim supported only by opinions of other people who happen to agree with you. Neither you or those other people even attempt to explain why your opinions are correct.

Except of course the fact that I posted real word evidence supporting my opinion.

I can't refute your incorrect assumption that falling consumer demand is not the cause of the recession

/sigh

I never said it was the cause of the recession. Clearly it wasn't. It is, though, the reason we are not at pre-recession levels.

Here is an excerpt from the article.

That article is funny. It seems to suggest that if you build it, they will come ... and buy it. I don't buy that! Just because someone makes something doesn't mean that something will always be purchased. If yo honestly believe that, then make very, very cheap razor-sharp kids toys and let me know how that works out.

You focus so much on demand and consumption you forget about production. Production is complicated.

No. Not really. If there is demand for a good someone will make that good, sell it and make a profit. If there is no demand, then no one will make it. If anything, I 100% trust companies to always act like companies. They will always make something if they think they can sell it for a profit. You apparently don't believe this. You seem to think companies need to be coaxed and encouraged to try and make a profit. That makes no sense to me.

 

[Charles_Main]

A person who earn $80,000 per year. If this person spends $50,000 per year, this person will pay $5000 as consumption tax.

A super-rich person spends $500 million per year, this person will pay $50 million consumption tax.

That is your problem right there

The person earning $80,000 a year will spend a large proportion of his earnings on housing, electricity, gas, food, medical care, education, transportation

That super rich person can spend millions on the same and only touch a small percentage of their earnings/wealth

It automatically shifts more tax burden to those who have to spend more to stay alive

Not if you exempt Utilities and things like Unprepared Foods from the Tax.

I Definitely think we should have some form of Consumption/National Sales Tax (exempting necessities like Groceries and Utilities) The Rich are the ones who have more money to spend, and do things like eat out all the time, and buy more Stuff. So they would pay more in a Sales tax, and you would also get tax revenue from the 50Million plus Tourists who visit the US every Year.

The Problem to me is that we will never see a Consumption/Sales tax that is actually offset if cuts to Income Taxes. Nope our Government will probably pass a Vat or Consumption tax, but it will not be replacing any taxes, it will be a new tax in addition to everything else we already pay.

 

[Avorysuds]

That is your problem right there

The person earning $80,000 a year will spend a large proportion of his earnings on housing, electricity, gas, food, medical care, education, transportation

That super rich person can spend millions on the same and only touch a small percentage of their earnings/wealth

It automatically shifts more tax burden to those who have to spend more to stay alive

I dare you to give us a in dept answer as to how you would make things "fair."

Or wait, you're that absolute partisan hack that that lives in the land of hypocrisy by supporting and voting for some of the richest people in the world as long as they are Democrat who manage to give themselves billions in Tarp/Stimulus money and extend tax cuts that they campain against... You know, their actual record VS the bullshit talking points they lure weak minded people in with?

Tell us all how you plan on taxing the rich, to pay for the middle class and the poor's entitlements when we currently run a 1.6 trillion dollar deficit a year deficit. How high do taxes have to be on the rich (and be specific) to pay for the GROWING entitlement programs consumption rate? This means ending wars along won’t answer the question, not that you support such an idea but how much more revenue will be needed this year AND how much will be needed in say ten years even without the wars?

Own up RW, it's all on you....

What is fair to me is the money someone earns working in a sewer is taxed at the same rate as money earned in the stock market

What is fair to me is returning to tax rates prior to the Bush/Obama tax cuts until we have paid off our debt

What is fair to me is ending wars in Afghanistan and Iraq before you start asking Americans to start sacrificing vital services

And yet you have said you will be voting for Obama... So "fair" is only importantant if you can use it to attack Republicans even when Democrats (Obama too!) share the same policies that you believe to be un-fair?