More on the FairTax

Aside from the obvious*, let's have a little more explanation on the FairTax and why it would work better than an income tax.

DEMAND

Some Economics 101: "Demand" is a term economists use to describe the amount of some given thing people are willing to buy. The cheaper that thing is, the more people want to buy it. The more expensive the thing is, the less people want to buy it. Most people are already either explicitly or intuitively familiar with this concept.

Income tax systems are FUNDAMENTALLY FLAWED because they effectively RAISE THE PRICE of jobs/work, rendering labor MORE EXPENSIVE. If there was no income tax, the price of labor would go down, quantity demanded would go up, and job creation would be encouraged rather than discouraged.

SPENDING VS. INVESTMENT

Continuing with Econ 101, there are basically two things people can do with their own money: they either spend it or they save it. Economists call this a "trade-off" between saving and spending, because more of one thing automatically translates to less of the other, and vice versa.

Unless you live in a cabin in the woods in Montana, you probably aren't going to save your money under a mattress -- there is a tendency for savings to correlate directly with INVESTMENT. Investment is a good thing. Investment promotes long-term growth. Investment makes for a favorable balance of trade, as opposed to a trade deficit. Investment means you're making interest instead of paying interest. Surplus is preferable to debt. Investment is what makes capitalism capitalism. Investment is the key to prosperity.

The problem is, spending is fun! Investment is dull. Investment is broccoli, spending is chocolate cake. Since Clinton left office, America has been on the chocolate cake diet.

Now, given that there is a trade-off between spending and investment... if the government were to tax spending (see above re: demand) spending would go down. When spending goes down (see above re: the trade-off between spending and investment) investment goes up.

BASIC NECESSITIES

But what about the things we all have to spend money on anyways, such as housing, food, clothes, medicine, etc.? The FairTax includes a monthly prebate to offset the taxes paid towards spending on these essentials. It establishes an effective base level of exemption, of money that you don't get taxed on -- what economists refer to as a "progressive" tax scheme.

CONCLUSIONS

This is why I advocate for the FairTax -- it streamlines the taxation system by using the already-existing, proven method of a sales tax. It levels the playing field by getting rid of the loopholes rich people and corporations use to avoid paying taxes. It promotes job creation, rather than discouraging it. It encourages investment. And it cuts poor people some slack by allowing for tax-free spending on basic necessities.

This is also one of the main reasons I will be voting for Gary Johnson in the upcoming presidential election.

Learn more at FairTax.org!

--Dan Colgate

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* Which is: that the current tax code is obviously broken; it unfairly burdens the middle class while letting the super-wealthy off the hook; it's tens of thousands of pages long; it wastes tons of taxpayer time and energy; and it really isn't any good for anybody, except elected officials who use it to hand out favors to special interests and the tax accountants/IRS agents whose jobs depend on it.

Income Tax R Stupit

Here's what R-money SHOULD be saying on the subject of income taxes:

"Our taxation system in this country is COMPLETELY STUPID IF NOT INSANE! It's so complicated, you need a degree AND a certification to understand it; it's got more pork in it than a 73,000-page Polish sausage; it's a colossal drain on the economy; and at the end of the day, it effectively PUNISHES (a) businesses for hiring and (b) laborers for working!

"Our taxation system is basically the equivalent of the bloated behemoth that was the Ptolemaic astronomy system in the mid-1500s -- it's so obviously wrong and broken, it's ridiculous. Hey, here's a brilliant idea: What if the EARTH revolved around the SUN?"

Learn more about the Fair Tax!

--Dan Colgate

Irreconcilable Differences

Here is a link to a piece by a Belgian person about the problem of Islam. The author makes a good point that when we in the West talk about "freedom of religion," we tend to make assumptions based on our own paradigm about how religion and basic rights work which Muslims don't share.

The way we see it in the West, some guy made some stupid movie and now all these stupid crazy terrorists are flipping out about it and they all just need to chill out and stop being so stupid.

The way these Muslims see it, our government is EVIL because it effectively promotes blasphemy (by refusing to take measures to censor it), and they therefore have a HOLY OBLIGATION FROM GOD to attack us and either kill us all or die trying.

In the West it is assumed that every person is born with his or her unalienable rights, but of course those rights only extend up to the point where they interfere with other peoples' rights.

For these militant Muslims it isn't really a question of rights so much as divine justice -- a crime against God has been committed, and God demands that his followers exact retribution from those responsible.

When does this sort of "chronic misunderstanding" become "irreconcilable differences"? I'd say about as soon as an American embassy is stormed by an armed mob and innocent people are injured and killed.

US Ambassador Chris Stevens
April 18, 1960 – September 11, 2012

--Dan Colgate

2012 Special Interest PowerScores™

Thanks to the Internet, it's now a well-known fact that money wins elections and the same sources fund both of the biggest political parties in the United States today.

As we approach November, I highly recomend perusing the numbers for yourself on OpenSecrets.org, which offers various splendid breakdowns of who and how much.

We took things a step further by running some analysis of our own. Without further ado, here are Objectable Content's Official 2012 Special Interest PowerScores™!

Power Score™	Industry	Total $ (D)	Rank (D)	Total $ (R)	Rank (R)
3	Retired	$34,522,643	1	$30,817,811	2
5	Securities & Investment	$20,354,223	4	$32,315,629	1
6	Candidate Committees*	$21,355,124	3	$22,700,740	3
10	Lawyers/Law Firms	$28,788,670	2	$6,756,603	8
10	Real Estate	$10,534,319	6	$15,433,911	4
14	Business Services	$9,747,151	7	$6,882,632	7
15	Misc Finance	$6,844,029	10	$10,026,734	5
21	Computers/Internet	$9,043,030	8	$3,715,783	13
21	Health Professionals	$6,299,333	11	$5,581,600	10
24	Misc Business	$6,280,898	12	$3,890,431	12
28	Misc Manufacturing & Distributing	$2,972,711	19	$6,525,101	9
34	Pharmaceuticals/Health Products	$2,725,515	20	$3,702,030	14
35	Retail Sales	$3,175,434	17	$2,803,487	18
36	Casinos/Gambling	$3,706,827	16	$2,763,154	20

All data comes from here and here.

The way this works is by comparing at each party's top 20 funding sources by industry and then combining their respective ranked positions across the board. I put an asterisk next to "Candidate Committees" because, although it is a major source of funding, it isn't really a special interest.

Based on these PowerScores ™, we're predicting that no matter who gets elected this year, you'll see the same pandering toward the usual suspects: old people, Wall Street, big business, construction/housing, lawyers, the bloated health care industry... but keep an eye out for tech on the up and up!

It's interesting to note that the two parties may not be as similar as they used to be -- there were a few sectors that only appear on one party's top 20 contributors list, so if you're looking for some REAL differences between these otherwise mostly policy-homogenous parties, follow these dollars:

Republican Top 20 Only	Total	Rank
Oil & Gas	$7,964,368	6
Insurance	$4,681,181	11
Automotive	$3,425,962	15
General Contractors	$3,303,560	16
Leadership PACs	$2,942,122	17
Commercial Banks	$2,777,533	19

Democrat  Top 20 Only	Total	Rank
TV/Movies/Music	$12,454,427	5
Education	$7,125,520	9
Non-Profit Institutions	$4,564,087	13
Printing & Publishing	$3,833,955	14
Lobbyists	$3,729,644	15
Civil Servants/Public Officials	$3,072,970	18

--Dan Colgate