Comments on: #787 http://www.upsidaisium.com/2007/04/26/787/ Fri, 19 Mar 2010 12:59:05 +0000 http://wordpress.org/?v=2.0.1 by: JediBear http://www.upsidaisium.com/2007/04/26/787/#comment-3370 Sat, 28 Apr 2007 21:40:31 +0000 http://www.upsidaisium.com/2007/04/26/787/#comment-3370 The "prebate" is all well and good, but it doesn't make the concept progressive. It just shifts the point at which it becomes regressive upward somewhat. I'm all for a massive entitlement program subsidizing every family in America more-or-less equally (the "prebate" is eerily similar to the Basic Living Stipend you'll see in more socialist countries,) but it doesn't really solve the FairTax's problems. On a microeconomic level, saving is good, for all the reasons you could probably mention (it also has potential drawbacks, but we won't dwell on that here.) On a macroeconomic level, saving is potentially bad. Saving (including stock "investments" and the like) tends to stagnate the economy. Investment (that is, spending) is what drives the economy. It is the /only/ driver. Things don't get produced if noone can afford to buy them, because eventually noone will be able to afford to produce them. Simultaneously, if things aren't getting produced, people aren't getting employed. This is how you get things like the Great Depression. The FairTax is a double-whammy for encouraging saving over investment. Firstly, it /penalyses/ investment. Second, its regressive nature puts a greater percentage of the economy in the hands of the people with the greatest existing tendency to save it. I'm not saying it won't work, and as I said, I actually like sales taxes and massive entitlement programs. I just worry about the likely economic effects (upheaval and stagnation) The “prebate” is all well and good, but it doesn’t make the concept progressive. It just shifts the point at which it becomes regressive upward somewhat. I’m all for a massive entitlement program subsidizing every family in America more-or-less equally (the “prebate” is eerily similar to the Basic Living Stipend you’ll see in more socialist countries,) but it doesn’t really solve the FairTax’s problems.

On a microeconomic level, saving is good, for all the reasons you could probably mention (it also has potential drawbacks, but we won’t dwell on that here.) On a macroeconomic level, saving is potentially bad. Saving (including stock “investments” and the like) tends to stagnate the economy.

Investment (that is, spending) is what drives the economy. It is the /only/ driver. Things don’t get produced if noone can afford to buy them, because eventually noone will be able to afford to produce them. Simultaneously, if things aren’t getting produced, people aren’t getting employed. This is how you get things like the Great Depression.

The FairTax is a double-whammy for encouraging saving over investment. Firstly, it /penalyses/ investment. Second, its regressive nature puts a greater percentage of the economy in the hands of the people with the greatest existing tendency to save it.

I’m not saying it won’t work, and as I said, I actually like sales taxes and massive entitlement programs. I just worry about the likely economic effects (upheaval and stagnation)

]]> by: Hecatomb http://www.upsidaisium.com/2007/04/26/787/#comment-3354 Sat, 28 Apr 2007 18:01:08 +0000 http://www.upsidaisium.com/2007/04/26/787/#comment-3354 At the risk of offending tons of people (like that ever stops me!), there is far more evidence of alien life than evidence of the existence of God. At the risk of offending tons of people (like that ever stops me!), there is far more evidence of alien life than evidence of the existence of God.

]]> by: Peter http://www.upsidaisium.com/2007/04/26/787/#comment-3324 Sat, 28 Apr 2007 08:35:03 +0000 http://www.upsidaisium.com/2007/04/26/787/#comment-3324 "I set up Google Analytics yesterday. (Heard about it from Ung, who seemed to be enjoying it.)" Hahahaha. I just love the top keywords section, especially when I get really strange hits like the ones I've posted. “I set up Google Analytics yesterday. (Heard about it from Ung, who seemed to be enjoying it.)”

Hahahaha.

I just love the top keywords section, especially when I get really strange hits like the ones I’ve posted.

]]> by: hjo3 http://www.upsidaisium.com/2007/04/26/787/#comment-3260 Fri, 27 Apr 2007 21:42:17 +0000 http://www.upsidaisium.com/2007/04/26/787/#comment-3260 Also, re: alien sentience: Isn't it weird how closely the issue parallels the atheism debate? I find it really strange how you often see people who declare their "certainty" in the existence of E.T. intelligence and also identify as atheists. Isn't there a logical conflict there? In both situations, no one has enough information to be sure. Also, re: alien sentience: Isn’t it weird how closely the issue parallels the atheism debate? I find it really strange how you often see people who declare their “certainty” in the existence of E.T. intelligence and also identify as atheists. Isn’t there a logical conflict there? In both situations, no one has enough information to be sure.

]]> by: hjo3 http://www.upsidaisium.com/2007/04/26/787/#comment-3258 Fri, 27 Apr 2007 21:31:39 +0000 http://www.upsidaisium.com/2007/04/26/787/#comment-3258 Re: FairTax/low-income: The system accounts for this. There is a "prebate" that individuals or families receive each month that provides compensation up to the poverty line. As for penalizing consumption, <i>that's</i> way more helpful to the poor than the current system (which primarily penalizes production). The FairTax plan incentivizes earning, saving, and conservation -- the key steps to becoming financially secure (or escaping debt/poverty). Why would you want to tax savings? That would encourage people to live with as little savings as possible, making them more likely to become insolvent when they encounter a major unplanned expense. Re: FairTax/low-income: The system accounts for this. There is a “prebate” that individuals or families receive each month that provides compensation up to the poverty line. As for penalizing consumption, that’s way more helpful to the poor than the current system (which primarily penalizes production). The FairTax plan incentivizes earning, saving, and conservation — the key steps to becoming financially secure (or escaping debt/poverty).

Why would you want to tax savings? That would encourage people to live with as little savings as possible, making them more likely to become insolvent when they encounter a major unplanned expense.

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