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Robert Reich
NationofChange / Op-Ed
Published: Saturday 22 October 2011
“Simple fairness requires three things: More tax brackets at the top, higher rates in each bracket, and the treatment of all sources of income (capital gains included) exactly the same.”

The Flat-Tax Fraud, and the Necessity of a Truly Progressive Tax

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Herman Cain’s bizarre 9-9-9 plan would replace much of the current tax code with a 9 percent individual income tax and a 9 percent sales tax. He calls it a “flat tax.”

Next week Rick Perry is set to announce his own version of a flat tax. Former House majority leader Dick Armey – now chairman of Freedom Works, a major backer of the Tea Party funded by the Koch Brothers and other portly felines (I didn’t say “fat cats”) — predicts this will give Perry “a big boost.” Steve Forbes, one of America’s richest billionaires, who’s on the board of the Freedom Works foundation, is delighted. He’s been pushing the flat tax for years.

The flat tax is a fraud. It raises taxes on the poor and lowers them on the rich.

We don’t know exactly what Perry will propose, but the non-partisan Tax Policy Center estimates that Cain’s plan (the only one out there so far) would lower the after-tax incomes of poor households (incomes below $30,000) by 16 to 20 percent, while increasing the incomes of wealthier households (incomes above $200,000) by 5 to 22 percent, on average.

Under Cain’s plan, fully 95 percent of households with more than $1 million in income would get an average tax cut of $487,300. And capital gains (a major source of income for the very rich) would be tax free.

The details of flat-tax proposals vary, of course. But all of them end up benefitting the rich more than the poor for one simple reason: Today’s tax code is still at least moderately progressive. The rich usually pay a higher percent of their incomes in income taxes than do the poor. A flat tax would eliminate that slight progressivity.

Nowadays most low-income households pay no federal income tax at all – a fact that sends many regressives into spasms of indignation. They conveniently ignore the fact that poor households pay a much larger share of their incomes in payroll taxes, sales taxes, and property taxes (directly, if they own their homes; indirectly, if they rent) than do people with high incomes.

Flat-taxers pretend a flat tax is good public policy, for two reasons.

First, they say, it would simplify paying taxes. Baloney. Flat-tax proposals don’t eliminate popular deductions. (I’ll be surprised if Perry’s plan eliminates the popular mortgage-interest deduction, for example.) So most tax payers would still have to fill out lots of forms.

Second, they say a flat tax is fairer than the current system because, in Cain’s words, a flat tax “treats everyone the same.”

The truth is the current tax code treats everyone the same. It’s organized around tax brackets. Everyone whose income reaches the same bracket is treated the same as everyone else whose income reaches that bracket (apart from various deductions, exemptions, and credits, of course).

For example, no one pays any income taxes on the first $20,000 or so of their income (the exact amount depends on whether the person is married and eligible for tax credits like the Earned Income Tax Credit of the Family Tax Credit.)

People in higher brackets pay a higher rate only on the portion of their income that hits that bracket — not on their entire incomes.

So when Barack Obama calls for ending the Bush tax cut on incomes over $250,000, he’s only talking about the portion peoples’ incomes that exceed $250,000. He’s not proposing to tax their entire incomes at the higher rate that prevailed under Bill Clinton.

Republicans have tried to sow confusion about this. They want Americans to believe, for example, that if the Bush tax cut ended, small business owners with incomes of $251,000 a year would suddenly have to pay 39 percent of their entire incomes in taxes rather than 35 percent. Wrong. They’d only have to pay the 39 percent rate on $1,000 – the portion of their incomes over $250,000.

Get it? We already have a flat tax – flat within each bracket.

The real problem is the top brackets are set too low relative to where the money is. The top-most bracket starts at $375,000 a year. People with incomes higher than that pay 35 percent – again, only on that portion of their incomes exceeding $375,000.

This is absurd. It means a professional who’s making, say, $380,000 a year pays the same income-tax rate as a plutocrat pulling in $2 billion or $20 billion.

Our current flat tax at the top is treating the nation’s professional class exactly the same as it treats super-rich plutocrats. My doctor pays the same rate as Steve Forbes.

Actually, it’s worse than that because the plutocrats get most of their income in the form of capital gains, which are taxed at only 15 percent. That’s why America’s 400 richest people – who earned an average of $300 million last year, and who have more wealth than the bottom 150 million Americans put together – now pay at a 17 percent rate (according to the IRS).

The Republicans’ push for a flat tax masks what’s really going on.

Remember: The top 1 percent is now raking in over 20 percent of the nation’s total income and owns over 35 percent of the nation’s wealth. Under almost anyone’s view of fairness, these are grotesque portions. They’re especially large relative to what they were as recently as thirty years ago, when the top 1 percent raked in under 10 percent. And these huge portions at the top continue to increase.

Meanwhile, the top tax bracket is now 35 percent — the lowest it’s been in three decades. Between the end of World War II and 1980 it never fell below 70 percent. 

Simple fairness requires three things: More tax brackets at the top, higher rates in each bracket, and the treatment of all sources of income (capital gains included) exactly the same.

Not only fairness demands it, but also fiscal prudence. A truly progressive tax would bring in tens of billions of dollars a year from the people at the top who are in the best position to afford it.

Regressives are pushing the flat tax as a smokescreen. They’d rather not have anyone talk about the unfairness and fiscal absurdity of the current system.

Rather than merely oppose the flat tax, sensible people should push for a truly progressive tax – starting with a top rate of 70 percent on that portion of anyone’s income exceeding $5 million, from whatever source.

This article was originally posted on Robert Reich's blog.



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ABOUT Robert Reich

 

ROBERT B. REICH, one of the nation’s leading experts on work and the economy, is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. Time Magazine has named him one of the ten most effective cabinet secretaries of the last century. He has written thirteen books, including his latest best-seller, “Aftershock: The Next Economy and America’s Future;” “The Work of Nations,” which has been translated into 22 languages; and his newest, an e-book, “Beyond Outrage.” His syndicated columns, television appearances, and public radio commentaries reach millions of people each week. He is also a founding editor of the American Prospect magazine, and Chairman of the citizen’s group Common Cause. His widely-read blog can be found at www.robertreich.org. Robert Reich's new film, "Inequality for All" is available on DVD
and blu-ray, and on Netflix in February.

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Woah nelly, how about them

Woah nelly, how about them alppes!

Since Steve Forbes first

Since Steve Forbes first proposed his Super-Unfair flat tax exempting capital gains years ago, there has been lots of talk about a fair tax. However, except for the Sophocratic Self-Adjusting Flat Tax, all such models are simplistic and seem to have been conceived in haste and without serious analysis.

The Sophocratic Self-Adjusting Flat Tax, however, is detailed, rational, fair AND progressive. See http://www.sophocracy.com and check it out.

The SAFT would make life easier and cheaper for the taxpayer.

If a Republican and a wealthy

If a Republican and a wealthy man like Steve Forbes proposes a flat tax, it's not good for anyone else. As the wealthy gobble up more of our nation's assets because the stock market becomes less and less relevant to more and more Americans as their wages and discretionary savings shrink, a regressive 9% sales tax will be the last act of squeezing blood out of the turnip majority. Progressive taxes, not more flat taxes and fees are what more states need.

A liberals sense of fairness

A liberals sense of fairness is substantially so twisted that any actual fair plan would look odd to them at best. Apparently Reich is operating under the delusion that if less than rich pay more tax that that would necessarily be unfair and as he weakly labels it, a fraud.

Consider a situation where the poor pay no taxes and only the rich pay taxes and their tax rate is 99%. Using Reich's idiotic logic it would be unfair for the poor to pay any tax and unfair since the rich will pay less tax. His main point is specious at best.

What constitutues fairness is the exact same tax rate for everyone, regardless of income levels. But that does not fly for the type of mindset that insists that redistribution of wealth is to be considered "progressive."

Now apply Reich's weak logic on other issues. For example, a progressive tax is fair since the bracket itself is universally applied. That is like saying that since we kill all millionares and not just some then that makes us fair. Like the old joke that Russia is fair because they guarantee nice funerals for everyone that they murder.

Reich is your typical liberal drone that has no real sense of fairness and will continue to say his illogical idiotic things because he manages to sucker in the other liberals in the audience that are as unfair minded as he and his ilk are.

Since Steve Forbes first

Since Steve Forbes first proposed his Super-Unfair flat tax exempting capital gains years ago, there has been lots of talk about a fair tax. However, except for the Sophocratic Self-Adjusting Flat Tax, all such models are simplistic and seem to have been conceived in haste and without serious analysis.

The Sophocratic Self-Adjusting Flat Tax, however, is detailed, rational, fair AND progressive. See http://www.sophocracy.com and check it out.

The SAFT would make life easier and cheaper for the taxpayer.

While I agree with Mr.

While I agree with Mr. Reich's philosophical position of a progressive taxation system, I am dismayed by the sophistry of this aspect of his argument:
"The truth is the current tax code treats everyone the same. It’s organized around tax brackets. Everyone whose income reaches the same bracket is treated the same as everyone else whose income reaches that bracket...."
This sentence does serious violence to the literal meaning of language. I expect better from Mr. Reich.

Before discussing anything at

Before discussing anything at all about taxes, there is one question which NO ONE, in or outside of the federal government, has shown satisfactory proof of any answer to:

WHERE do taxes GO?

Another matter: Government spending for any purpose should be based upon the effectiveness of the funded agency at achieving the purpose -- as defined by those who are theoretically benefiting from it. If no one is willing to come forward and testify subject to cross examination that they benefited, then who cares where the funding came from? It was either wasted, or worse, sabotaged its very earmarked purpose.

Jessie, There is none so

Jessie, There is none so blind as he who will not see. You obviously refuse to see the regressive nature of a flat tax. You obviously refuse to see that the progressive tax is flat within brackets. I doubt you are in the top 1% in the ranking of wealthy individuals so it is pretty obvious you have decided to drink the kool aid offered by their shills in such organizations as the Tea Party.

Flat within brackets is fair

Flat within brackets is fair because ...

Well, it is not. It is a illogical use of the english language and does not stand the test of truth.

That is like saying that if you kill all Republicans and not just some then it is fair since they belong that that particular bracket.

Or what about 100% tax rate on all billionares? Fair because the same rule is applied to each and every billionare.

Liberals are seriously deluded in their mental process and what they consider fair and just simply defies all sense of justice and logic.

While I can appreciate the

While I can appreciate the varying perspectives re. the flat and progressive tax schemes, they miss the point. The issue of taxation and prudent and practical revenue allocation would not be central to economic stability and growth if wages were redistributed. In a scenario where enterprisers and their respective shareholders didn't pay themselves 200-400% more than they paid their employees, the mean disposable income could support a flat tax and still make substantive revenue contributions. A progressive tax with far narrower, less disparate % parameters would do so likewise. Putting tax reform in the foreground without addressing wages in the background is palliative at best. As long as we have the net savers using a the lion's share of money that equitably belongs to employees, collaborates with banks to lend that same money back with an ROI in interest, works with the Federal Reserve to inflate and devalue currency, and off-shores jobs to attempt to keep even more profits, massive deficits will continue, requiring more convoluted remedies, like recoupment from the citizenry in the form of taxes, de-funding of the country's safety net, and the like. However, for the reasons above, the flat tax is just another loophole by which the wealthiest at the top continue to unjustifiably keep what is not theirs while the working class and poor continue to pay far more than they should. Progressive taxation is the best method we have until people finally get in and reclaim their government and usher in regulations on how businesses compensate their employees because the current model is not working.

In other words, NathanM wants

In other words, NathanM wants to take redistribution of wealth one step further. That way, since everyone makes the same amount of wages then a flat rate would be fair. I don't know whether to laugh or weep at the general lack of justice and fair minded people there are in America.

But then I take some solace in the fact that there are only about 19% liberals in the USA and 40% more fair and logically minded conservatives. Of course 19% insanity rate in any community is still nothing to brag about.

Super-tax the super-rich to

Super-tax the super-rich to grow the economy.

Republicans like George Will smugly state that even when the US taxed the super rich in the past at 70% and 90% in the highest brackets, no one actually paid those rates. But they fail to mention just how they managed to overcome that liability. The very wealthy did successfully and legally avoid those taxes. Rather than pay those confiscatory rates on their excess income, they opted instead to grow their businesses.

They devoted more funds to research and development, built new plants, updated old ones and hired new employees. They invested in insurance, profit sharing and pension plans for the mutual benefit of themselves and their employees. They did all of this to the benefit of our entire society primarily to avoid that higher tax bracket while continuing to build their individual wealth. .

The prevailing arguments for tax relief for the super rich, those alleged “job creators”, are exactly wrong. If you want to expand the economy you first need to tax the high end of those multi-million dollar incomes at a substantially higher rate to give them the incentive to invest that excess capital back into the economy rather than hoard it or worse, use it to further corrupt our political system, or earmark it to some hedge fund manager to manipulate the markets to the extreme detriment of all but a very few of us.

“The subjects of every state ought to contribute toward the support of the government in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state." Adam Smith. Wealth of Nations 1776

Yet another straw man

Yet another straw man argument. The conservative view about taxes is not tax relief for the rich but a fair flat tax for everyone. Yes, it means those that pay no taxes will finally pay taxes and yes it means rich will start paying a tax rate equal to everyone else.

Now of course I understand that socialist minded folks will howl at the suggestion that the rich actually pay a fair tax rate. How will liberals get the money to purchase votes from the poor with a fair tax rate. That is simply impossible. So howl they will. Loud and long, and they will come up will all sorts of illogical examples of why it is "a fraud" to pay a flat tax rate. This article case in point.

+1

+1

two hundred to four hundred

two hundred to four hundred times.
not 200% or 400%, which is twices as much
and four times as much •••

@Bionicknight. Get a life!

@Bionicknight. Get a life! Or get original.

First off, we need to

First off, we need to disabuse ourselves of the notion that taxes are theft. We all receive benefits from the federal government and ought to pay for them through our taxes.

Secondly, progressivity makes practical sense. The effective decrement my taxes make to my life style has decreased as my income (and my tax bracket )has increased. I started my adult life as a blue-collar worker and after obtaining post-graduate degrees I am now a professional. I never once thought - "Why should I get another degree when it will just put me in a higher tax bracket?"
Who the hell thinks like that?

The argument that progressivity disincentivizes achievement is a conservative chimera.

A progressive tax is theft.

A progressive tax is theft. It is designed to purchase votes from those willing to sell them for tax breaks and or government handouts, free Obama phone anyone, and it requires a "progressive" tax plan in order to have the money to do so.

The lame idea that it is fair since everyone in a given bracket gets the same amount stolen from them is simply ludicrous.

Amen!

Amen!

My apologies, I inadvertently

My apologies, I inadvertently posted twice.

The 9-9-9 tax plan is

The 9-9-9 tax plan is nonsense from somebody who knows that Americans are conditioned to like catchy sounding advertising offers. Cain knows. He's from the retail fast food business. Government is not the same thing as business but many conservatives act like it is. Government is not there to make a profit. The only skill that should transfer from business to government is fiscal discipline and good use judgement in the use of public funds. After that, it is a very different animal.

What's more catchy sounding

What's more catchy sounding than "vote for democrats and we'll give you more handouts." That is a tried and true method of purchasing votes, call it progressive or vote buying or whatever.

The more money Government

The more money Government appropriates, the more wars they make. Starve the Beast!

9-9-9 is just another "shell

9-9-9 is just another "shell game" created by the 1%, to hurt the 99%.

SICK OF THIS!

Let’s wake up America!

The 1% of Piratical Capitalists are strangling the other 99% of Americans and the rest of the world to death!

I’m sick and tired of the Democrats, the Republicans, the tea party, and the news media!
I’m sick and tired of listening to incessant political nonsense while we the people, are losing everything!

Are we supposed to remain passive while we lose our jobs, our homes, our families, our health, our savings, our future, and our lives!? Are we…really!?!?! Do you people out there want to let this happen!?

Are we just supposed to lie down and die?! Sure, greedy corporations and the elite rich would love that wouldn’t they? If we’re dead, then we can’t cause any trouble. If we’re dead, then we can’t come after them!

We’ve been blind and passive way too long. We keep dancing around the real solution here, while the rich pay off our politicians and the courts to stay free and so they can repeatedly rape us!

No-way, it’s time we put a stop to this! They need a lesson here. Unfortunately, the American Revolution, the French Revolution, and the Russian Revolution were necessary because the royals and elite rich just never did get it. They didn’t care that millions of people were being hurt or dying because of them.

We have that same exact international situation right here…right now. We’re not dead yet, and there are millions and millions of us around the world. And that, is OUR POWER!

People, we are in the midst of a Global Revolution! It’s happening now and it’s time we pulled these arrogant royals off of their thrones. Yes people, IT’S TIME IT GOT UGLY!

This is why.

THE NEW AMERICAN PIRATES, ARE KILLING AMERICANS.

This is not about glamorized or fictional piracy. This is, “real piracy.”

Hundreds of our wealthiest leaders and most powerful corporations know that in the next few years, they will be able to siphon, skim, and steal, so much “NEW CASH,” that they and their progeny will be ultra-rich for generations to come.

Welcome to the modern “Piratical Capitalism” movement. And, welcome to WAR!
No, this is not funny, or fiction, or a conspiracy, it is just simple greed and simple theft.
The new pirates of America have launched an all-out siege on us…the 99%, in order to capture, amass, and hold many trillions of dollars for themselves.

All of the recent political power grabs and nonsensical debating is purely a slight-of-hand deflection. President Obama, Democrats, Republicans, the International Press, and even the Tea Party, are watching the tiny pea in the shell game…while the rich and powerful “Piratical Right” is stealing America right out from under us.

Consider that their combined total plunder from corporate flipping, downsizing, offshore labor, speculation, price fixing of oil and energy plus, corruption in defense, health care, banking, student loans, foreclosures, etc., etc., is a trillion dollar treasure for these pirates.
Go ahead, put your own calculator to it.

Are they smarter than we are? Yes, and they are laughing at us. I, we, you, and all of us, have not been able see the big picture of what is happening to our own country and to our own people. The rape and theft of America, has been cleverly packaged, promoted, and sold under the guise of “cost-cutting,” “deregulation,” and “free enterprise.”

The “Piratical Right” is directly responsible for millions of people dying, getting sick, losing their jobs and homes, losing their ability to fight, their spirit, and even losing their will to live. The sick smell of this carnage now permeates the air across America.

To us, this is all unimaginable, because we look for some sense or the morality of things. These modern-day American pirates however, have no moral compass. They are devoid of any conscience, humanity or soul, and are feeding on the flesh of the American people.

Don’t look to the President, the Senate, Congress, the press, or any political party to help. Sadly, they just don’t see it, don’t care, or are part of it. “We the people” are on our own. Start asking questions. Demand answers. If we don’t fight back America…who will!?

History has taught us how to stop piracy!

Once one loses their mind

Once one loses their mind then it is easy for these sort to imagine that everyone is taking advantage of them. Case in point, the above comments.

First of all, refreshing to

First of all, refreshing to see so many people in the comments praising the merits of a flat tax.

Unfortunately for me (Jesse Reich) Robert Reich continues to give other, intelligent "Reichs" a bad name.

"Remember: The top 1 percent is now raking in over 20 percent of the nation’s total income"
** Correct ** and they pay 40% of total income tax revenue. Most people would agree this is unfair, Reich thinks its unfair because the 1% should be paying 50%? 70%? 100%???

Also, Cain's plan, as well as most flat tax proposal would simplify the tax code by eliminating most if not all tax deductions. This would result in a vastly more efficient tax system, less people "gaming" the system, and more revenue, if implemented effectively.

Secondly, a flat tax would treat everyone, and every dollar they earn the same. Contrary to what Reich says, a progressive income tax does not treat everyone equally. It essentially tells a high income earner to stop trying as hard, investing as much or generally, be as productive after they've reached a certain level of income. It reduces their drive, motivation and incentives they have to grow their company, this includes hiring new workers.

But if Reich truly wants a heavily progressive income tax, let him come out and say exactly what he wants in clear terms. Just as Marx and Engels did in their communist manifesto when they called for a heavily progressive income tax.

The other less intelligent

The other less intelligent Reich operates under the Soviet style of fairness, where they guarantee every one that they murder a nice funeral.

Did you notice his ludicrous idea that if everyone in a given "bracket" is treated the same way (fair or not) then that should be considered fair treatment, since everyone in the same bracket is stolen from using a consistent mathematical formula.

I just have to laugh at how far gone mentally the liberal ilk has become with their convulted sense of justice and their oh so twisted ideas of what is logical.

"Also, Cain's plan, as well

"Also, Cain's plan, as well as most flat tax proposal would simplify the tax code by eliminating most if not all tax deductions"

...which would have the affect of further raising taxes on the people that can currently take advantage of those deductions. Look, I'm all for reforming so-called "expenditures in the tax code" (deductions), but eliminating them all would hurt those with less much more than the rich & it would hurt our economy (especially housing) even more.

"It essentially tells a high income earner to stop trying as hard, investing as much or generally, be as productive after they've reached a certain level of income. It reduces their drive, motivation and incentives they have to grow their company, this includes hiring new workers."

Ugh...more utterly failed, trickle down, voo-doo economic nonsense...

"But if Reich truly wants a heavily progressive income tax, let him come out and say exactly what he wants in clear terms. Just as"

...Adam Smith, the father of modern economics, did very, very strongly when he was alive...lol...

So the robber barrons of the

So the robber barrons of the twentieth century did not get filthy rich from paying a 90% tax rate? High taxes really was a disincentive for their drive, motivation and spirit to succeed. Taxes are the lowest in history and you fuckers are still whinning. I have never made a investment decision based on taxes paid, its ROI. And asking someone to pay their fair share in taxes is commy, then I guess our forefathers were commies too. Go fuck yourselves

Liberal anger doth runneth

Liberal anger doth runneth over. But liberal logic and a sense of fair play is totally lacking. Case in point, mr FU above.

As money has bought the

As money has bought the government, it also blinds you. The people who get the most from the government, that is, protection of t heir wealth, should pay more than those that get the least. The poor fight the wars to protect and enrich the capatilists who are running the country. And, if we should eve get taken over by anthoer country, they would simply turn Quisling.

Wars are fought just to

Wars are fought just to protect the rich? Tell that to the UK that fought Germany to protect their very lives and homes and land and it did way more than protecting just the rich. In short, you are delusional at best in your sense of world history.

And communists like

And communists like Eisenhower and Goldwater -- who also approved if highly progressive tax on income and corporations...

Damn Commies!!!

Since you think you can name

Since you think you can name some conservatives that also had progressive tax rates (to some degree perhaps) then that justifies the idiotic meme that progressive taxes must be correct in nature. Too funny. Truth established by the idea that the other party did some stupid things too.

I would hope that at least

I would hope that at least some politicians have the best interest of the American people, but the facts show that the government (elected politicians) are just getting more greedy. The flat tax rate, if it replaces all of the present tax policies, will help the Wealthy and Only the wealthy.

One reason is the lower the income the more is used for buying basics, like food, shoes and the like. If the sales tax is one of the main sources of taxes.
If the capital gains tax and the estate tax is removed, it won't help the average family. That alone would benefit only the super wealthy. They spend a small part of their income for purchases.
that is only 1 reason it would be unfair.

A flat tax rate will be fair.

A flat tax rate will be fair. Who benefits from a fair system is rather beside the point for honest fair minded people. For those liberal type that vote based on how much net gain they get from other taxpayers however will universally fail to understand what the point is about general fairness, truth and honesty. It is something that they simply will refuse to consider.

And do liberals really believe their own opinions? Ask a liberal in the USA that makes a hundred times more money than somebody in Mexico and see how many volunteer to be taxed at 90% since that would make things more "fair" to the poor in Mexico.

Apparently liberals will only go so far in their belief systems. Much like Buffet (and many other phony libs) claiming that they will willingly pay more taxes yet never take advantage of the current ability to simply send in more taxes right here and now without any need for new laws. But alas, apparently their desire to pay more taxes is not quite as sincere as their desire to pretend that they want to do more for the poor, almost always with somebody elses money.

I like Ron Paul's new tax . .

I like Ron Paul's new tax . . . none. Dr. Paul wants to abolish the IRS and downsize Government so that an income tax is not needed. I like the way he thinks. A lot of people think he is crazy, but if you stop and think about it, before the Federal Reserve was 'born', we never need the IRS. Their conception was spawned along with the Federal Reserve and their purpose was to collect taxes on the money we borrowed from the Private Bankers that run the Fed. Of course, if we followed our Constitution (as Ron Paul suggests), our Government would be minting the Nation's money, less the middle men and thus we would not be paying interest on our money. Rather than discuss how to tax the people, we should be discussing how to cut spending.

You are somewhat correct,

You are somewhat correct, except that the federal government still collected money from the states. The difference was that the early tax system involved all states being taxed a flat rate based on pure population count. When evil minded liberals saw an opportunity to increase their power base by using federal tax money they quickly latched onto the progressive tax system introduced with allowing federal income tax the way we see it today.

"A lot of people think he is

"A lot of people think he is crazy, but if you stop and think about it, before the Federal Reserve was 'born', we never need the IRS."

Ummmm, we've had a forerunner of the IRS around since 1862 & the modern-day Fed came into being in 1916. Yes, Ron Paul is, in fact, a crazy old fool...ugh...

"Of course, if we followed our Constitution (as Ron Paul suggests), our Government would be minting the Nation's money, less the middle men and thus we would not be paying interest on our money."

Wrong again, since the only entity that can legally print or coin money is the U.S. Treasury. The federal govt. pays exactly ZERO interest to the Fed, period.

That is one of the stupidest

That is one of the stupidest ideas of all.

The government is the biggest

The government is the biggest fraud of all. Why give them more money to blow? The bottom line is that we need to reduce taxes and that means on the wealthy. The earners will put that money to work to expand the economy. None of non politicians have the benefits that they do. Or very few. The people are getting raped by the government and we don't even know it. The democrates are the biggest offenders and must ne stopped. Obama, Reid, Polosi are a joke. Until be get politicians in that will look out after our interest we are doomed.Since, the tea party. Better get on board before it's to late.

Hoo Boy! Yeah, they

Hoo Boy! Yeah, they certainly have reinvested the trillions that the Bush cuts have provided, haven't they? Are you that dumb?

You do realize that the

You do realize that the "government" currently pisses away over 51% of the income tax revenue on the f*cking Imperial War Machine, right?

Slash the war machine and we wouldn't have to raise taxes (to cover gwbush's three phony wars!)

Not all that oddly is that

Not all that oddly is that most democrat leaders signed onto what you so incorrectly label as gwbush wars. I guess if you liberals figure you have to stop all wars then perhaps you need to stop your democrat politicians from getting the US involved in so many wars in the first place.

But if you enjoy countries that don't spend much money on a strong military, then move. You are free to do so.

Has any one of the morons in

Has any one of the morons in Washington ever taken into account what effect a flat tax would have on our HUGE underground economy? It would legalize it! Which means bringing in more tax money. Enough is enough level the tax field and maybe everyone will start working for a living!!!

"Has any one of the morons in

"Has any one of the morons in Washington ever taken into account what effect a flat tax would have on our HUGE underground economy? It would legalize it!"

No, it really wouldn't, especially if you are talking about flat income tax rates.

The fact is we continue to

The fact is we continue to this day to have tax reform..e.g. 1986, 1990, Bush tax cuts, expanded tax brackets, tax credits, etc. What is obviously needed though is simplification and certainty. A simple SET of "flat tax" rates according to income levels, employment vs. self-employed, corporate, profit vs non-profit, capital gains would work well, provide certainty to businesses to stimulate investments, increase discretionary income for wage-earners, and provide more revenue to the federal government to lower the debt. Just do it. First steps are to write the plan in no more than 100 pages, set the course with the change, peg a date for initiation in 4 years, do dry runs for the first 2 years, make adjustments and run dry for the next 2 years, then execute it.

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