# Bush 2005 - no more IRS, income tax



## MisterMike (Aug 4, 2004)

http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=39762

Read GOP lips: 
No more IRS
Hastert hints of Bush's secret plan to end income tax in his 2nd term

"In his upcoming book, "Speaker: Lessons from Forty Years in Coaching and Politics," Hastert says the bold move  sure to be immensely popular with voters  will be the centerpiece of President Bush's domestic agenda in a second term."

What do you think? If this comes up on the campaign, would it seal the deal for anybody?

I think it would be a big hit. Leveraging a national sales tax instead of an income tax is a step away from socialism and leverages our capitalist market.

Comments?


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## MisterMike (Aug 4, 2004)

Some more info, but this guy is not "holding his breath."

http://boortz.com/nuze/200408/08032004.html#fairtax


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## rmcrobertson (Aug 4, 2004)

Embarassing realities:

1. Americans pay less of a percentage of their income as tax than anybody else in the industrialized world.

2. The primary motives behind abolishing the IRS and income tax--like the primary motives behind Bush's, "tax cuts--" are right-wing politics; in "cutting the government," all these folks are going to be cutting welfare, medicaid, education, Head Start, and every other program you ever heard of. In other words, what this is really all about is an attack on the poor, the working class, and the lower middle class.

3. It might be good to seriously consider what's going on when extremely wealthy types like George Bush (who has never done a plain day's work in his life) his VP, and the rest of the guys push for tax cuts on the grounds that tax cuts help the economy. 

4. It is understandable that the wealthy and powerful would push these agendas. It is understandable that so many folks who would be totally screwed by them also  push these agendas.

5. If this happens, wave bye-bye to: public parks; after-school programs; mail service; state parks; cheap school lunches; home nurse visits; vaccination programs; college scholarships and cheap loans and work-study programs; emergency rooms available to everybody...the list is endless. Which suits the guys pushing this stuff, because the real point is to alter, to abolish, or to corporatize all these things. And guess who will be making money off the changes?

6. Oh well. Never happen anyway, though I hope the Prez tries.


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## michaeledward (Aug 4, 2004)

A looney idea from the least effective Speaker of the House in the history of the United States. That this topic is even being discussed (by others, not we) demonstrates the victory of sound-bite over substance.

Go Denny Go!


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## PeachMonkey (Aug 4, 2004)

MisterMike said:
			
		

> http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=39762What do you think? If this comes up on the campaign, would it seal the deal for anybody?


 Only for the extremely wealthy, and the extremely ignorant.



			
				MisterMike said:
			
		

> I think it would be a big hit. Leveraging a national sales tax instead of an income tax is a step away from socialism and leverages our capitalist market.


 Such a program is the ultimate regressive tax structure, designed to eliminate all societal benefits, guarantee the dominance of wealth over all other factors, eliminate the so-called "American Dream", and lead eventually to revolution.

 When people such as yourself demonstrate such a fawning worship for the "capitalist market", I often wonder if you really think out the consequences of a purely market-driven society.  Adam Smith himself cautioned against the dangers of handing too much power to capitalists.


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## MisterMike (Aug 4, 2004)

PeachMonkey said:
			
		

> When people such as yourself demonstrate such a fawning worship for the "capitalist market", I often wonder if you really think out the consequences of a purely market-driven society.  Adam Smith himself cautioned against the dangers of handing too much power to capitalists.



LOL...OOOK..forget I eeeeeven asked...LOL


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## PeachMonkey (Aug 4, 2004)

MisterMike said:
			
		

> LOL...OOOK..forget I eeeeeven asked...LOL


 I'm not quite sure what this statement means.  Is it a): "Capitalism is such an obviously great thing that no criticism of it can be brooked, and since you seem to believe there are flaws to it, we cannot have a discussion", or is it b): "I'm not really equipped to enter into an intellectual discussion about societies and how they can best be supported"?


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## Mark Weiser (Aug 4, 2004)

The Major Problem with Government is People run it. By reconginzing this as the main problem you can move forward in establishing a system that is fair to everyone(LOL) this will never happen in the history of mankind anyone in the seat(s) of power will do whatever is neccessary to maintain or solidify his or her base of power. 

If You or I were in those same shoes as the elitist. We would be doing the same thing.  I for one am waiting for the ballon to pop on our economy here in USA and God Help Us when it does. 

Sincerely,
Mark E. Weiser


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## Cryozombie (Aug 4, 2004)

PeachMonkey said:
			
		

> When people such as yourself demonstrate such a fawning worship for the "capitalist market"...
> 
> ...I'm not quite sure what this statement means. Is it a): "Capitalism is such an obviously great thing that no criticism of it can be brooked, and since you seem to believe there are flaws to it, we cannot have a discussion", or is it b): "I'm not really equipped to enter into an intellectual discussion about societies and how they can best be supported"?



Monkey... I think that was C) Since you resorted to a silly personal attack instead of discussing the issue, I am blowing you off.


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## Cryozombie (Aug 4, 2004)

Back onto topic...

While I dislike the IRS and taxes in General... Doing away with them will, In my opinion, Hurt us more than it would help us.

Those taxes, while silly and extravagant in many cases, are neccessary to keep the machine oiled.


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## PeachMonkey (Aug 4, 2004)

Mark Weiser said:
			
		

> this will never happen in the history of mankind anyone in the seat(s) of power will do whatever is neccessary to maintain or solidify his or her base of power.
> 
> If You or I were in those same shoes as the elitist. We would be doing the same thing.


 This is a pretty bleak view, Mark... I think no matter where people stand on capitalism/socialist, tax/no tax, if we can't at least agree to try and make things better *somehow*, we're hosed.


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## PeachMonkey (Aug 4, 2004)

Technopunk said:
			
		

> Monkey... I think that was C) Since you resorted to a silly personal attack instead of discussing the issue, I am blowing you off.


 Technopunk,

 Point well taken.  

 MisterMike,

 I apologize for the implied personal attack.  My frustration with our society's unwillingess to actually examine the flaws and amoral nature of lassez-faire capitalism often gets the better of me, and I took it out on you.


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## MA-Caver (Aug 4, 2004)

Reading that topic heading I thought to myself : *CAUTION: Bush's Intelligence is Showing!*
I hate taxes as much as anybody else, but like most people I can see how important they are in maintaining our country. 
I argued the fact with someone (younger than me, who was whining about it) that if we didn't have taxes, we wouldn't have good roads, good police and fire protection and most importantly... no military to protect this country from all invaders foreign and domestic. All that among other things.
Some taxes are ridiculous but many are necessary. We need to get rid of the fools that abuse the tax system and make those who avoidance to pay up. The rich need to pay up just as much as the working class does. 
The Government needs to quit over-spending and get into _sensible_ spending (no $400 hammers or $800 toilet seats and so on.)
There's a better way to do taxes... the present system isn't it.


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## MisterMike (Aug 4, 2004)

PeachMonkey said:
			
		

> I'm not quite sure what this statement means.  Is it a): "Capitalism is such an obviously great thing that no criticism of it can be brooked, and since you seem to believe there are flaws to it, we cannot have a discussion", or is it b): "I'm not really equipped to enter into an intellectual discussion about societies and how they can best be supported"?



Well,



> When people such as yourself demonstrate such a fawning *worship* for the "capitalist market",...



OK, right there I didn't need to read much further to tell you assume way too much from my first post. I'd personally rather not get too engaged in a string of emotionally charged thread drift. But if you can point out where I expressed that I'm game.



> ...I often wonder if you really think out the consequences of a purely market-driven society.



Sure, but can ANYONE tell what that road leads down to? If someone has the clarevoyancy, please step forward. Is it really the "elimination of the American Dream and Revolution?" 

But I'll say this, if we have to have taxes, I'd rather it be on my expenditures, rather than my earnings before I can spend it.

So if you would tell me then, since regressive tax schedules will only batter the poor deeper back into their caves, how far whould your ideal dream of progressive taxation go? 75%?

Even I can realize there has to be a balance. We are not 100% capitalist nor 100% communist. There has to be a balance on individual freedom and social responsibility. The arguing tends to come in when it gets politicized and the inevitable differences on where to draw the line.


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## MisterMike (Aug 4, 2004)

PeachMonkey said:
			
		

> MisterMike,
> 
> I apologize for the implied personal attack.  My frustration with our society's unwillingess to actually examine the flaws and amoral nature of lassez-faire capitalism often gets the better of me, and I took it out on you.



Not to worry. I get it all the time 

I also posted up above while you were writing this response, so now maybe we're even


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## JAGMD (Aug 4, 2004)

A national sales tax system would be much more equitable than the current income tax based system.  Based on this nation's GDP, a 10% national sales tax on non-grocery items would actually increase tax revenue, and therefore no reduction in your precious programs would be necessary.  Futhermore, prior to this administration 55% of all tax revenue was paid by only 5% of the population.  (It's a fact, look it up)  So much for the "rich" not paying their "fair share" and all that BS liberal rhetoric.  BTW I have a negative net worth after factoring my student loans and I am one of the "rich" people they are talking about.  (no my student loans aren't tax deductible either because I am "rich").  By making it a sales tax system, the tax burden is spread equally to those who participate in the overall economy.  It would also eliminate the tax shelters that the ultra-rich use to pay less taxes, so you should love it.  Then if we could just eliminate all of the inefficient government programs you love so much we could eliminate the deficit.  Then we could drill for oil in 10 acres of vast 'tundra' aka frozen wasteland in Alaska and largely eliminate our foreign dependence on oil.  Then the Saudis couldn't use our $$$ to fund terrorism.


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## Trident (Aug 4, 2004)

Great if it would happen, but I'm not holding my breath.  There would have to be a major marketing push to sell it to the public & offset the high pitched whine that would eminate from the media.

Maybe he should take 1 preliminary step to generate public support:  stop withholding income tax from people's paychecks.  If everyone in America had a write a quarterly or monthly check to the federal government to pay their taxes, I predict there would be a huge uproar.  That would be the push necessary to really  get the income tax system changed.

Mike


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## PeachMonkey (Aug 5, 2004)

JAGMD said:
			
		

> A national sales tax system would be much more equitable than the current income tax based system.


 If you define "equitable" as: "percentage of individual wage-based income", then yes, it would be more equitable.  However, this "equity" provides no real balance and fairness, and provides no support for a social contract.  Rather than repeat myself on these issues, I refer you to the following post:

http://www.martialtalk.com/forum/showthread.php?p=255507#post255507



			
				JAGMD said:
			
		

> Based on this nation's GDP, a 10% national sales tax on non-grocery items would actually increase tax revenue, and therefore no reduction in your precious programs would be necessary.


 It would also increase the tax burden of the lower and middle classes.  This is, in and of itself, unacceptable.  In addition, since they will have less disposable income, these classes will reduce their consumption and spending.  How is any of this a good thing?



			
				JAGMD said:
			
		

> BTW I have a negative net worth after factoring my student loans and I am one of the "rich" people they are talking about. (no my student loans aren't tax deductible either because I am "rich").


 My heart bleeds for your negative net worth, truly, but do you ever wonder if you're going to be able to eat the next day?  Do you have to decide between rent and medicine for your kids?  Just curious.

 And if we reduce taxes as you propose below, how do you think your student loans would ever have been funded?



			
				JAGMD said:
			
		

> By making it a sales tax system, the tax burden is spread equally to those who participate in the overall economy. It would also eliminate the tax shelters that the ultra-rich use to pay less taxes, so you should love it.


 I've already commented on your ideas of "equality". In addition, eliminating the tax shelters you describe is meaningless... the shelters won't be necessary since the wealthy will pay *even less* than they do now under your system.



			
				JAGMD said:
			
		

> Then if we could just eliminate all of the inefficient government programs you love so much we could eliminate the deficit.


 Can you provide figures which back up these claims of inefficiency?  Say, comparing a number of social welfare programs to businesses?  Feel free to include the Pentagon in your descriptions of "inefficient government programs"... how many TRILLIONS of dollars can they not even account for?  How many social programs would that pay for?

 Also, can you please tell me exactly how much of the deficit could be eliminated by eliminating "inefficient programs"?  Welfare, for instance, accounts for less than 1% of government expenditures.



			
				JAGMD said:
			
		

> Then we could drill for oil in 10 acres of vast 'tundra' aka frozen wasteland in Alaska and largely eliminate our foreign dependence on oil. Then the Saudis couldn't use our $$$ to fund terrorism.


 Sorry for the thread gankage, but you brought up ANWR.

 Where exactly do you get your numbers from?  The USGS claims that in a best-case scenario, ANWR would provide less than 1% of US domestic oil production over its 50-year lifespan.  The region would take 10 years to become productive, and another 15 to reach maximum production.  ANWR *proponents* recognize that _2000_ acres would need to be touched, and this doesn't include the roads and pipelines constructed between the 35 oil areas to be used in ANWR and Prudhoe Bay.

 See: http://www.ucsusa.org/global_environment/archive/page.cfm?pageID=780

 This refers to US Geological Survey factsheets for additional reference.

 It seems to me that requiring automakers to adjust light truck and SUV fuel economy is a far more productive way to reduce US foreign oil dependence.  Moreover, kicking the President whose family has decade-old ties to Saudi oil might be an even quicker way to get US money out of terrorism's pockets.


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## michaeledward (Aug 5, 2004)

JAGMD said:
			
		

> Then we could drill for oil in 10 acres of vast 'tundra' aka frozen wasteland in Alaska and largely eliminate our foreign dependence on oil.


You forgot the prepositional phrase at the end of this sentence ... "for six months". (it's a fact, look it up).

Thanks for contributing. Mike


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## MisterMike (Aug 5, 2004)

I do not think this would be more of a burden on the lower class because being in the lowest tax bracket they would take home more money each week and if the sales tax was set up right, there wouldn't be tax on food, rent or clothing anyways.

And if we want to talk about fair, a flat sales tax is a lot fairer than a tiered one based on income.


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## PeachMonkey (Aug 5, 2004)

MisterMike said:
			
		

> I do not think this would be more of a burden on the lower class because being in the lowest tax bracket they would take home more money each week and if the sales tax was set up right, there wouldn't be tax on food, rent or clothing anyways.


 There already isn't sales tax on food and rent, at least everywhere I've lived.  The sales taxes paid on all other items, however, would increase.



			
				MisterMike said:
			
		

> And if we want to talk about fair, a flat sales tax is a lot fairer than a tiered one based on income.


 Another misconception.  Current income taxes are not tiered based on income as a whole, but on *wage income*.  The majority of the income of the wealthy comes from non-wage sources, and as such, is taxed less (or not at all).

 Moreover, why isn't it fair for those who have best taken advantage of society's benefits to contribute more to that society?  Why isn't it fair for those who have more to give more, particularly since they still have so much left over even after giving more deeply?


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## MisterMike (Aug 5, 2004)

PeachMonkey said:
			
		

> There already isn't sales tax on food and rent, at least everywhere I've lived.  The sales taxes paid on all other items, however, would increase.



What types of other items do you see that the poor need that would then be out of reach for them if there was a 20% sales tax? Mind you, they would be keeping about 15% more of their wages. You said this would affect the poor but I'm kind of narrowing it down monetarily, not in the presumed cut in social services.




			
				PeachMonkey said:
			
		

> Another misconception.  Current income taxes are not tiered based on income as a whole, but on *wage income*.  The majority of the income of the wealthy comes from non-wage sources, and as such, is taxed less (or not at all).



I would disagree or perhaps you are talking about the top 2-5% in this case. It is tiered, and if you do not know how to make deductions, it will be taxed at 35%. Let's say most of the top 2-5% make a majority of their money off stocks. If you let them set for 18 months, it's no longer a short term gain. There are lots of other places to stash your cash, but by letting it stay in the system, isn't that a benefit back to society as well?

I don't think the people between the 10% and the 35% brackets are making their money off stocks. Why do they pay a higher rate of their wages?



			
				PeachMonkey said:
			
		

> Moreover, why isn't it fair for those who have best taken advantage of society's benefits to contribute more to that society?  Why isn't it fair for those who have more to give more, particularly since they still have so much left over even after giving more deeply?



I think they are contributing more. If someone made a $million, and paid 20%, that's more than 20% on the next guy's 100k. Fair (percentage-wise), and they gave more to society. So the have-mores CAN still give more even with a flat tax. Why isn't it fair to still give more ontop of more? Because they earned it. Who are we to say who has 'so much left over' or 'too much left over'?


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## michaeledward (Aug 5, 2004)

MisterMike said:
			
		

> I would disagree or perhaps you are talking about the top 2-5% in this case. It is tiered, and if you do not know how to make deductions, it will be taxed at 35%. Let's say most of the top 2-5% make a majority of their money off stocks. If you let them set for 18 months, it's no longer a short term gain. There are lots of other places to stash your cash, but by letting it stay in the system, isn't that a benefit back to society as well?
> 
> I don't think the people between the 10% and the 35% brackets are making their money off stocks. Why do they pay a higher rate of their wages?


Capital Gains has very little to do with the cash flow generated from stock ownership. Companies pay dividends to share holders, regardless of how long a stock is held. 

Dividends are taxed at 15%. 
Dividends are not taxed as wages from labor (contribution to the economy).
The correct question is not 'Why should workers pay more than this?' but rather, 'Why is this source of income taxed less?' To which the answer is, because the Bush Administration cut this source of income, directly benefitting those who have.

The sale of a share of stock that was held for longer than 12 months (18?), is taxed at a Capital Gains rate, which is also lower than wages from labor. One of the issues with this, is that the wealth can be transferred from one generation to the next without the gain being taxed at all. As long as the share of stock is held (and not transferred), no taxes should be assessed. But when it changes hands, taxes are paid (or losses deducted). Why should the gain or loss be valued differently than wage income?

And why, when generational transferrs occur, do we allow all the gain from generation 1 to be tax free when generation 2 sells the stock?

Mike


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## MisterMike (Aug 5, 2004)

michaeledward said:
			
		

> Capital Gains has very little to do with the cash flow generated from stock ownership. Companies pay dividends to share holders, regardless of how long a stock is held.
> 
> Dividends are taxed at 15%.
> Dividends are not taxed as wages from labor (contribution to the economy).
> ...



You're probably right on most of what happens to moneys in stocks. But how is this unfair? Everyone has the ability to invest and be taxed at the same rates. (Unless you are poor or don't work))


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## rmcrobertson (Aug 5, 2004)

A few more embarassing realities:

a) Businesses tend to oppose sales taxes. Why? Because they believe, with some support from reality, that the higher the sales tax, the less people buy.

b) Sales taxes are identified as, "regressive," taxes because they disproportionately  affect the very people least able  to afford paying them--i.e. the poor, and the working class, and the lower middle class.

c) The demands to abolish income tax, as always, rest upon the fantasy that, "everything would be fine," if we just cut welfare, cut programs such as Head Start--you know, everything that, "they're," getting--and just let capital run amuck.

d) These demands are always tied to other right-wing dreams--getting rid of environmental legislation, for example--and bring out the fact that the real agenda involves letting the irresponsible do whatever the hell they please at the expense of everybody else.

e) It would be easy to get off our dependency on foreign oil....especially since Jimmy Carter explained exactly how over twenty years ago. We need to get rid of gas-guzzling cars like SUVs, and raise the old home thermostat to, say, 76 degrees in the summer and lower it to, say, 68  in the winter. We need to stop what Wendell Berry called, "our idiotic attempt to illuminate the entire outdoors." We need to get rid of many of our, "labor saving devices," and even more importantly, all the endless Christmas lights, motorized elves, etc., with which we try to fill up empty lives. We need to walk, bike, take public transport.

f) We will do none of these things. Why? Because it's easier to stamp our little feet, screw our eyes shut, and claim that reality isn't there. Because it's easier to blame, "the environmentalists." Because we refuse to engage in rational city planning, transportation planning, or anything else. Because we've always got away with  it so far, and we refuse to face the facts that times have changed. Because we refuse to look at the science of these questions (global warming, anyone?); because we've systematically undercut science education because somebody might teach evolution and reason; because it's easier to act like spolied children and drunken sailors on shore leave, and simply grab what we want when we want it. And, of course, because we've built our economy around selfishness and waste.

g) But hey, keep blaming those wacky environmentalists. What have they to do with taxes? Well, our present economy, building habits, work patterns, etc., are unsustainable. And we throw enormous amounts of money at trying to pretend otherwise. So, it's a lot easier to--for example--endlessly rebuild houses in the Florida Keys that shouldn't be there in the first place, or keep extending cities into burn areas out here in California, or keep constructing freeways--which we pay for--than it is to sit down, make plans as a society, and behave like grown-ups. 

h) Not going to happen any time soon. Taxes are a great alibi.


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## michaeledward (Aug 5, 2004)

MisterMike said:
			
		

> You're probably right on most of what happens to moneys in stocks. But how is this unfair? Everyone has the ability to invest and be taxed at the same rates. (Unless you are poor or don't work))


A 'single' laborer earning $50,000.00 per year is taxed at 27%.
A 'single' stock-holder earning $50,000.00 per year in dividends is taxed at 15%.

27% = 15%    <<<  that doesn't look like a true statement to me.

After drawing out living expenses, how much, and for how long, do you suppose the single laborer would have to invest to transfer his income from labor to dividend? 

During this time, the stock-holder, is not laboring at all, yet continues to earn his lower-taxed dividends. 

Who among our two hypothetical persons is contributing to society more?
Who among our two hypothetical persons is benefiting more?

The plan works great if you have hundreds of thousands of dollars sitting in dividend paying stock. The rest of us schmucks will get there in a couple of hundred years.

Thanks - Mike


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## MisterMike (Aug 5, 2004)

michaeledward said:
			
		

> A 'single' laborer earning $50,000.00 per year is taxed at 27%.
> A 'single' stock-holder earning $50,000.00 per year in dividends is taxed at 15%.
> 
> 27% = 15%    <<<  that doesn't look like a true statement to me.



Yea but you left out that the $500,000 he made in wages before the he invested it as stock money was taxed at 35%.

35% of $500,000 != 27% of $50,000

it's actually a lot more.


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## Feisty Mouse (Aug 5, 2004)

I just wanted to say that this has been a very interesting thread, and I have been lurking and reading.  I hope the discussions continue.

I happen to be of the opinion that a flat tax is indeed unfair.  

:lurk:


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## michaeledward (Aug 5, 2004)

MisterMike said:
			
		

> Yea but you left out that the $500,000 he made in wages before the he invested it as stock money was taxed at 35%.
> 
> 35% of $500,000 != 27% of $50,000
> 
> it's actually a lot more.


Except he never earned $500,000.00 as wages. He inherited from his grandmother the AT&T stock she had purchased in 1923 ... 

Now, because grandmother died before selling the stock, there was no capital gain paid to the US Department of Revenue on all of that unrealized profit. The grandson can now value the stock at the price when the transfer occurred ... so any sales will realize a *much smaller* capital gain.

.... OR ....

Grandma bought the stock at $1.00 per share (yes she paid income tax on the wages used to invest).
Over the Grandma's life, the stock split three times and now is worth $51.00 per share, (the original $1.00 dollar investment is current worth $408.00)
Grandson inherits stock at $54.00 per share in 2000.
Grandson sells 1000 shares stock in 2004 at $51.00 per share, realizing a $3,000.00 *LOSS*, which he uses to offset the 15% dividend income tax on his $50,000.00 dividend.
Grandson spends all his time posting to Martial Talk about how eliminating the IRS is a good thing.

Ok ... I'm kidding. Actually, the Grandson owns multiple radio stations in which he hosts right-wing talkshow hosts, and contributes to conservative 'Think Tanks'.

Thanks for Playing this weeks episode of ... You Bet Your Life's Income. 

Mike


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## PeachMonkey (Aug 5, 2004)

MisterMike said:
			
		

> Everyone has the ability to invest and be taxed at the same rates. (Unless you are poor or don't work))


 Very few people are actually in the position to ever invest enough of their income that they will be able to derive significant dividend income.

 Moreover, even if your statement were correct, why is it fair to tax this particular kind of income at a lower rate than wages?


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## Cryozombie (Aug 6, 2004)

I know a lot of places don't...

But here in Illinios there is a Tax on food.

I dunno about rent, but I pay a couple K a year in taxes on my Mortgage.

Minnesota doesnt (or didnt, the last time I was up there) have a Sales tax on clothing.  That was pretty cool.

Hey...  What if they eliminated all the BS extra taxes, and ONLY taxed our incomes?  Nah... Id only see 10% of my check!


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## MisterMike (Aug 6, 2004)

PeachMonkey said:
			
		

> Very few people are actually in the position to ever invest enough of their income that they will be able to derive significant dividend income.
> 
> Moreover, even if your statement were correct, why is it fair to tax this particular kind of income at a lower rate than wages?



Well, if it's only a few people I don't see what the big deal is.

I think getting into why the tax rate is fair for one thing and not for another is beyond my original intent on this thread but I'd be more upset with the rates on say, gasoline and lottery winnings.

Ever look at the amount of tax and "fees" on your telephone bill?

The gov't has it's hand in every pot you got, and it's just too much. Their programs are bloated with bureaucracy and waste and perhaps cutting taxes will make it rethink its spendthrift philosophy and lack of efficiency. Not likely though.


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## michaeledward (Aug 6, 2004)

MisterMike said:
			
		

> Well, if it's only a few people I don't see what the big deal is.
> 
> I think getting into why the tax rate is fair for one thing and not for another is beyond my original intent on this thread but I'd be more upset with the rates on say, gasoline and lottery winnings.
> 
> ...


Michael, thank you for continuing to play ... 

The big deal about dividend tax rates is the stratification of society. One of the founding principles of our country is that 'All men are created equal' ... not meaning equality of goods, but rather equality of opportunity. Each of us, by our industrious behavior, have the chance to acquire and succeed. This is distinctly different than the societies we left behind in Europe, where your lineage dictated what opportunities were available to you.

When the effects of lower dividend taxes, and the elimination of the estate tax (I know, new topic) have on society, we begin to see the creation of a self-perpetuating upper class, which has most, and with every passing generation acquires more. While recognizing that our society is not a zero-sum gam, such stratification has always led to the destruction of society.

Oddly, lottery winnings are taxed as wage income - were that they were taxed as dividends.

Gasoline is a straight regressive tax, it affects lower income people more. However, if we examine the results in the economy of automobiles on whole, we may find that they have a negative effect, in which case, a higher tax would be better, to discourage the use of automobiles.

The Telephone Service in Rural America is really one of the greatest triumphs of American History. You can pick up a phone and call anyone, anywhere. Pretty cool. Back before deregulation, it made those taxes pretty easy to understand.

While I appreciate your sentiments that 'the government' (which as you know, is us) inserts itself, via taxation, into too many areas of our life. I remind you that our system of governance is based on 'Taxation *with* Representation'. Run for office ... I'll even send in a donation to your campaign. 

I do agree, that it is painfully difficult to end a bureaucracy, (Massachusetts Turnpike Authority?). We should be able to do that more often. The premise, I guess, is that not all taxes are evil.

Mike


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## MisterMike (Aug 6, 2004)

michaeledward said:
			
		

> Michael, thank you for continuing to play ...
> 
> The big deal about dividend tax rates is the stratification of society. One of the founding principles of our country is that 'All men are created equal' ... not meaning equality of goods, but rather equality of opportunity. Each of us, by our industrious behavior, have the chance to acquire and succeed. This is distinctly different than the societies we left behind in Europe, where your lineage dictated what opportunities were available to you.
> 
> When the effects of lower dividend taxes, and the elimination of the estate tax (I know, new topic) have on society, we begin to see the creation of a self-perpetuating upper class, which has most, and with every passing generation acquires more. While recognizing that our society is not a zero-sum gam, such stratification has always led to the destruction of society.



OK, so the bottom line is that you think we should keep taxes high on the rich so the money can be put back into society to help the lower class still have an equal shot at "success." I think most of the taxes goes to government spending and government jobs. Not much to the social programs designed to help the lower class.

I'm just seeing way too many variables in this so to continue I'm probably going to have to pick up about 5-10 books on economics/capitalism.


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## PeachMonkey (Aug 6, 2004)

MisterMike said:
			
		

> I think most of the taxes goes to government spending and government jobs. Not much to the social programs designed to help the lower class.


 This is a result of the choices made by elected officials, rather than the inherent nature of a tax-funded society.  That "government spending" employs "government jobs" primarily to support the Pentagon and to pay interest on debt from previous government borrowing.  Shifts in how those funds are spent (as well as greater equality in how they are collected) could dramatically help social programs and help all of society, not just the lower classes.

 Social programs that help people survive, get healthy, become educated, and in so many other ways help people improve their lives don't just benefit those individuals.  *Everyone* benefits from a more educated, healthier society.  *Everyone* loses, in the end, when things become more stratified and the wealthy classes segment all benefits of society for themselves.


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## michaeledward (Aug 6, 2004)

MisterMike said:
			
		

> OK, so the bottom line is that you think we should keep taxes high on the rich so the money can be put back into society to help the lower class still have an equal shot at "success." I think most of the taxes goes to government spending and government jobs. Not much to the social programs designed to help the lower class.
> 
> I'm just seeing way too many variables in this so to continue I'm probably going to have to pick up about 5-10 books on economics/capitalism.


I don't think I made any statement concerning how 'high' taxes are supposed to be. Clearly, the tax changes initiated by the Bush Administration are tilted heavily to those who have more money; but the issue was pushed as a benefit for *everyone*. 

Because society requires 'rules' to function, taxation is required to establish and enforce those rules. The rules, and the taxation should be equitable to all. I am not certain that 'equitable' and 'equal' are interchangable.

Perhaps the discussion can best continue by substituting the word 'Services' for 'Taxes': I am for lower services; I am in favor of more services. I want to cut services. 

As for books about economics and capitalism; I might suggest "The Myth of Ownership", it's a good read, in favor of a balanced society; in which the authors conclude progressive taxation is not unjust.

Mike


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## Makalakumu (Aug 7, 2004)

Feisty Mouse said:
			
		

> I just wanted to say that this has been a very interesting thread, and I have been lurking and reading.  I hope the discussions continue.
> 
> I happen to be of the opinion that a flat tax is indeed unfair.
> 
> :lurk:



I've been out of town and have skimmed this thread.  Forgive me if this has already been discussed, but what is so bad about a flat tax rate?

Has anyone ever thought about tax reform? Real tax reform? For instance, why do we need loopholes and tax brackets and automatic deductions ect. Is it possible to have one tax rate and work on running the government from that? For instance, let say I pay 10% (arbitrary figure) of my income in federal taxes. Is it too much to ask that a poor person or a rich person pay the same? Why should anyone get out of paying their fair share?

Take a look at what this has done for Ireland. They reformed their tax rate in the 90s and now MN outsources jobs to them. Meanwhile every citizen has health care, education (including post secondary), good roads, ect...

upnorthkyosa


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## Flatlander (Aug 7, 2004)

It's a good start.  But I believe that it's important to have some minimum threshold beneath which no taxes are paid.  For those living in poverty, that little bit helps, and it doesn't take a lot extra from the higher wage earners to make up for it, in terms of percentages.


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## michaeledward (Aug 7, 2004)

upnorthkyosa said:
			
		

> . . . Is it possible to have one tax rate and work on running the government from that? For instance, let say I pay 10% (arbitrary figure) of my income in federal taxes. Is it too much to ask that a poor person or a rich person pay the same? Why should anyone get out of paying their fair share? . . . .
> 
> upnorthkyosa


The discussion becomes one of defining 'fair share'. Good people can come to disagreements about what constitutes 'fair share'.

The discussion concerning a single rate tax is that it is a 'regressive tax'. This means, it affects in a more negative way those with lower incomes. If we assume a consistant 'cost of living'; the value of 'one dollar' for a person making 10,000 per year is considerably more than a person making 100,000 per year. 

Person A pays $1,000.00 under the flat 10% plan.
Person B pays $10,000.00 under the flat 10% plan.

Person A now has to provide for himself and his family on $9,000.00.
Person B can provide for himself and his family on $90,000.00.

Both persons have to pay the same price for a gallon of milk, a gallon of gas and any other necessities in life. Who struggles more under the 'flat tax'?

Also, assuming that Person B in the above situation purchases a 'nicer' home, and 'nicer' car ... one of the functions of government is to protect both persons from foreign invaders. Taxes are collect to provide this protection to both citizens. Because Person B has 'more' (or 'nicer') property to be protected, the argument can be made that his portion of the taxes used to protect his property from foreign invaders should be higher? 

These two discussions can be considered when thinking about taxation strategies. They are two of the reasons our Federal Income Tax has a 'Progressive Structure'. 

Thanks for listening. Mike


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## Makalakumu (Aug 7, 2004)

My arguments for a flat tax rate would be as follows...

1.  There are already regressive taxes that come right out of our paychecks.  FICA and Medicare are two of them.  These taxes have income limits that weight the burden of paying toward those that can least afford it.  A flat federal rate would erase these taxes and replace them with a rate that would be more affordable and more equitable for all citizens.

2.  A flat tax rate would hold all citizens equally accountable for their country.  It is my belief that all citizens of this country should be obligated to pay taxes.  From the richest to the poorest, no one can escape their social responsability for the price of living in this country.  A flat tax rate demands equal sacrifice from all citizens.  For instance, a person who make $1,000,000 dollars, taxed at a 10% percent rate, would owe $100,000 dollars in taxes on that income.  A large bite no matter how you cut it, but fair considering that they would not have had the opportunity to become so successful if they did not live here.  At the same time, a person who makes 10,000 dollars should also be expected to give up an equal portion of their income.  

3.  The tax rate, under a flat tax system, would fall for the poor and rise for the rich.  Comparitively, I envision the tax system of this country as a pyramid.  Those in the lowest brackets pay the higher rates, while those in the higher pay the lower.  This pyramid system is a regressive tax structure because the burden to the standard of living falls mostly on those with the least, while the burden to the standard of living is less for those with the most.  A flat tax rate would even this out.

4.  The overall tax rate for the middle class would fall.  As the rich are made to pay an even rate with the poor and the middle class, enough money would roll into the government coffers that they would be able to support governmental functions at a lesser rate for the middle class.  This is, in essence, a tax cut for the middle class.

5.  Adjustments to the tax code would be far easier for the average citizen to understand, making the legislative process more transparent.  As it stands now, the tax laws of this country fill thousands of pages.  Naturally, this leads to some clever evasions by those who have influence over the legislative process.  A flat tax rate with no escapes and no loopholes would make doing taxes an exercise in simple mathematics and it would make reporting on changes in the rate extremely easy in this sound byte based society.  

6.  Does anyone else agree with this?  Can you think of other benifits?  I could go on, but I have poopy diapers to change. 

Respectfully

upnorthkyosa


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## CanuckMA (Aug 8, 2004)

As pointed before, the problem with flat taxes is that the burden is greater for those at the lower end of the spectrum. It has been pointed before. While no one can argue that the person earning 1,000,000 will pay more in taxes than the person earning 10,000, the higher earner is left with considerably more. I believe that the best system would have a bracketed system like we currently have, but it should also include some portion that one must pay regardless of deductions. Or the elimination of most deductions and loopholes in conjuction with a lowering of rates. Everybody should be able to deduct an amount equal to the poverty line. After that, it's taxed.


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## Makalakumu (Aug 8, 2004)

The tax system is broken in this country. There are regressive taxes everywhere that are not included into the numbers that the middle class pays in income tax. Meanwhile, the upper brackets escape from these taxes or they do not affect them as much. I have seen numbers when they are all added together that show the average middle class person paying up to 30% to the federal government! And when you add state taxes ontop of this its a miracle anyone can put food on the table, put their kids through college and own a home. Meanwhile the upper brackets find shelter after shelter for their income. Their contributions to some government programs are income capped, forcing the little guy to pay the lion's share...Take a look at the book "Nickled and Dimed to Death" and you'll see just how badly the middle class is getting screwed in this country.

This has got to stop. We need to burn this system to the ground and install something that everyone can understand, something that treats everyone equally and holds everyone equally accountable rich and poor. Then and only then can we can talk about what we actually want to fund for government services.

Take a look at what this would do for MN. As it stands now, there are huge loopholes that have allowed corporations, which are just groups of people, to shelter large portions of their income. They are setting up one room offices in other countries and claiming that they have off shore bases and the state is losing millions in revenue. If we closed all of the loopholes and slammed one rate down that everyone had to pay, that money would come pouring in. 

I think that we are underestimating just how much taxes the upper bracket slide away from. I own a martial arts studio as a side business and I just cracked a threshold of income that puts me into the business owner catagory. I can now write off my vehicles because I use them for traveling to tournaments and for further training. I can write off any expenses I pay for further training including hotel rooms, food, and fees. I can write off my house because I have a space inside of it where I train students and where I can practice my own skills. Anything, Bucket, anything, if I can tie it to my business, I can write it off. 

Now I want you to imagine a person like my uncle, who made 33 million dollars in three months from his investments. He has an office in his mansion, takes business clients on business trips in one of his four boats, uses all of his vehicles...the lexus, the escalade and the porche to travel for this business. Ect...

I am just learning about this so please correct me if I'm wrong about any of it, but, I believe that if these kind of things exist for me, that and more exist for someone like my uncle. Its absolutely rediculous and the average joe is getting screwed beyond all belief. 

Closing ALL loopholes and slamming down a flat tax rate fixes this problem, in my humble opinion.


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## michaeledward (Aug 11, 2004)

This report from the CNN website:
http://money.cnn.com/2004/08/11/news/economy/election_bush_tax.reut/index.htm?cnn=yes



> *NICEVILLE, Fla. (Reuters) - President Bush said Tuesday that abolishing the U.S. income tax system and replacing it with a national sales tax was an idea worth considering. *
> "It's an interesting idea," Bush told an "Ask President Bush" campaign forum here. "You know, I'm not exactly sure how big the national sales tax is going to have to be, but it's the kind of interesting idea that we ought to explore seriously."
> 
> Republican economists who speak regularly to the White House have said that the Bush campaign has been mulling the idea of an overhaul of the tax code as part of an agenda for a second term should Bush win reelection.


I find it interesting that it is being considered as part of the second term this late in the election cycle ... less than 100 days to the election, and they are only now talking about 'seriously' exploring the idea. 

This leads me to believe a 2nd Bush term has *no ideas* which should be considered more seriously than this late season despiration pitch.

Also, it is convenient that Bush is only willing to 'explore seriously' the idea of abandoning the IRS after primary season. A primary season, by the way, in which many of the Republican primaries were cancelled. Taking away the right to vote for many Republicans across the country.

Mike


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## PeachMonkey (Aug 14, 2004)

upnorthkyosa said:
			
		

> Closing ALL loopholes and slamming down a flat tax rate fixes this problem, in my humble opinion.


 Closing loopholes is a potentially laudable idea, but we've already covered, ad nauseum, just how bad a flat tax rate is for everyone except the wealthy.


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## PeachMonkey (Aug 14, 2004)

More fun information on why replacing income and other taxes with a national sales tax is completely moronic:

 Estimates Show 60% Sales Tax Needed:
http://www.brook.edu/views/papers/gale/20040812.htm

 Even a Pro-Social-Security-Privitization Republican Group Has Data On Sales Tax Insanity:
http://www.ncpa.org/edo/bb/2004/20040809bb.htm


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## Makalakumu (Aug 14, 2004)

PeachMonkey

I'm not totally sold for or against a flat tax.  The only way I would even consider it is if all loopholes were slammed shut and all regressive taxes were eliminated.  There would be no income capped taxes, no more sales tax, or user fees.  I wonder if that would balance the system out?

upnorthkyosa


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## PeachMonkey (Aug 15, 2004)

upnorthkyosa said:
			
		

> I'm not totally sold for or against a flat tax. The only way I would even consider it is if all loopholes were slammed shut and all regressive taxes were eliminated.


 The thing is, flat taxes are *inherently* regressive.  Take a second to think about it, using a completely pulled-out-of-my-rear-end percentage of 20%.

 If you tax a preschool teacher making $20K (not that many make anything like that much, but what the heck) 20% of her income, she takes home 16K to pay bills, consume like a good capitalist worker bee, and save (har har).

 If you tax Billy Bigwig who makes $100 million a year 20% of his income, he takes home... wait for it... $80 million dollars.

 The gap here between what both people need to spend to survive and what they have left over should illustrate to you the inherently regressive nature of such a taxation scheme.

 Now, of course, I'm sure we'll see the question: "Why should wealthy people pay a higher percentage?  That's not _fair._"

 At the risk of over-simplifying thousands of years of societal development, historic progress, and simple social justice, here's why:

 The wealthy can afford to be taxed far more and still retain all the monetary advantages of being rich and special.  Moreover, since those wealthy people who actually *earned* their wealth rather than inheriting it or winning it did so because of the advantages provided by our society, they have a responsibility to contribute to said society in proportion to their success.


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## Feisty Mouse (Aug 15, 2004)

> The wealthy can afford to be taxed far more and still retain all the monetary advantages of being rich and special. Moreover, since those wealthy people who actually *earned* their wealth rather than inheriting it or winning it did so because of the advantages provided by our society, they have a responsibility to contribute to said society in proportion to their success.


 :cheers:   Well said.


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## rmcrobertson (Aug 15, 2004)

What can one expect?

The whole point of abolishing the IRS has absolutely  nothing to do with fairness, improving the economy, or any of the other claptrap that Bush and his cronies--and the idiot libertarians--keep bringing up.

It has to do with abolishing any and all regulatory controls on what the swine are up to, and with abolishing any and all social justice.

Just think of it. No FDA. No EPA. No Social Security, Head Start, Congesssional Budget Office...no monitoring of Wall Street. No CDC.

Bush and his cronies--the guys who brought us Enron and Iran/Contra and ITT/Chile--free, free at last, Great God Almighty, they's free at last. 

Gee, what a nifty idea. Especially given the ongoing oppression of Texas oil millionaires.

And after all, we all KNOW how much this would benefit working people.


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## Makalakumu (Aug 15, 2004)

A lot of people forget that FICA (medicare and social security), user fees, and sales taxes are also taxes.  When all of these taxes are added into what the middle class pays, the percentage rises dramatically.  Meahwhile, the upper brackets find all of these loopholes to weasle out of their social responsibility.  The IRS claims that the upper brackets pay 33%.  The Center for Tax Reform shows that, after all of the deductions and loopholes, this figure is more around 3%.

Take a look at some of the numbers.  First of all, social security is taxed at around 6.5%.  This number is capped at 87,500 dollars.  Every dollar above that figure reduces the percentage.  At one million dollars this figure approaches nill.  This goes the same with medicare, user fees and sales taxes.  And ALL of these are sneaky ways the government has shifted the tax burden to the middle class.

Lets go back to your flat rate of 20%.  The middle class is already paying more then this when everything is added in.  The upper brackets are FAR below this after all of the deductions and loopholes.  Tax reform in this fashion would hand some suprising tax bills to the middle class and the upper brackets.  The tax pyramid would finally be reversed and all Americans would finally pay what they owe.  The upper brackets would pay more and they would pay at the same rate as the lower brackets, taking away their ability to complain.  

A flat tax rate (and reform) would lower taxes on the middle class and effectively hand the upper brackets a 17% tax increase.  What do you think?

upnorthkyosa


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## michaeledward (Aug 15, 2004)

upnorthkyosa said:
			
		

> A flat tax rate (and reform) would lower taxes on the middle class and effectively hand the upper brackets a 17% tax increase. What do you think?
> 
> upnorthkyosa


Still against it ... Still regressive.

Certainly, there are other ways to clean up the discrepencies you point to (eliminate the cap on FICA & Medicare contributions - tax dividends as income - restore the Estate Tax).

And I am concerned that, while the original discussion may include the elimination of all federal taxes in favor of a National Sales Tax on goods *and services* (doctor visits), during negotiations the IRS is eliminated, but FICA and other ancillary taxes are not. So we end up with the worst of both worlds.

Mike


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## Brother John (Aug 15, 2004)

JAGMD said:
			
		

> A national sales tax system would be much more equitable than the current income tax based system.  Based on this nation's GDP, a 10% national sales tax on non-grocery items would actually increase tax revenue, and therefore no reduction in your precious programs would be necessary.  Futhermore, prior to this administration 55% of all tax revenue was paid by only 5% of the population.  (It's a fact, look it up)  So much for the "rich" not paying their "fair share" and all that BS liberal rhetoric.  BTW I have a negative net worth after factoring my student loans and I am one of the "rich" people they are talking about.  (no my student loans aren't tax deductible either because I am "rich").  By making it a sales tax system, the tax burden is spread equally to those who participate in the overall economy.  It would also eliminate the tax shelters that the ultra-rich use to pay less taxes, so you should love it.  Then if we could just eliminate all of the inefficient government programs you love so much we could eliminate the deficit.  Then we could drill for oil in 10 acres of vast 'tundra' aka frozen wasteland in Alaska and largely eliminate our foreign dependence on oil.  Then the Saudis couldn't use our $$$ to fund terrorism.


THAT is exactly IT!!!!
Thanks for bringing this forth.

Your Brother
John


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## rmcrobertson (Aug 15, 2004)

Waaal, ah don't know much 'bout no tax code. And them eck-o-nomics....but I do have one teeny question.

What exactly is it, anywhere in the careers of President Bush and Dick Cheney, that you find such convincing proof of their deep commitment to helping ordinary people? Where precisely is it that you see so much as anything that they have done, at any point, to help working people?

In other words, where exactly is all this faith that these guys wanna revise the tax system Just To Help Us Out coming from? 

By the way--the reason that your student loans are so hard to pay off is that, under Reagan, a) the interest rates were increased radically (my college loans were at 2%; my grad school loans cost around 4%), b) grant programs got cut; c) the tax code was changed so that, for example, tuition wavers were for the first time counted as income. And back then, incidentally, you did not have to pay for a parking permit on National Forest land. Hm.

But I'm sure these guys Know What's Best.


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