dirty
EOG Master
Merrill Bender One of General Motors key parts suppliers, Delphi Corporation, filed for bankruptcy on October 8th and has sought wage concessions from its Unions to lower the average wage from $27/hour to as low as $12/hour. Wage pressure comes primarily from the low almost slave like wages paid in foreign countries to their workers and those foreign countries being able to export their cheap goods to the U.S. This high cost of wage argument has been a consistent problem and call by American Manufacturers that are trying to compete in a global marketplace as well as compete within the American Marketplace.
CNN's Lou Dobbs almost competes with Bill O'Reilly in his level of indignation and outrage on how American Manufacturing Jobs are leaving American Shores. However, they and many other Americans misunderstand and dismiss the serious grassroots support and supporting research for a solution that will truly help the "little guy" and restore good paying American Jobs. (The Fair Tax HR 25/ S25. www.fairtax.org)
The Solution For Delphi and for American Manufacturing in General is not trade barriers or tariffs but is fair trade. But how do you get Fair Trade when competing countries do not pay a Fair Wage? American Workers do not need to compete globally by lowering their wages to such Draconian levels.
American Manufacturing goes where it costs them the least to do business. Even with the higher costs of fuel to ship those goods from overseas the low wage is what helps some countries compete and it is the Lower business taxes that helps other countries compete. In Europe, Ireland has had the strongest economic growth and best employment numbers because they have the lowest taxes on business(Corporate tax 12%)
The Solution for America is Lower Taxes on American Manufacturing not Lower Wages on American Workers. The incentive for business to stay in America and not outsource is lower taxes on Corporate earnings with less tax compliance costs. Ultimately, It is the consumer that pays the business tax in the end on all products and services. Business taxes like business costs for manufacturing are just worked into the price. The Consumer pays the tax not the business.
What if the United States had the lowest Corporate tax in the World. Would not business flock here to manufacture? What if instead of the Bahamas being the Offshore tax haven for business or Corporate headquarters that for Tax purposes those businesses made New York, or California, or Chicago their Corporate home and their preferred place to manufacture from and ship around the World?
There is such a tax plan in Congress waiting in the wings to rev up our Economy, by providing the right incentive for American Manufacturing to stay in America, for Good paying manufacturing jobs not to be outsourced, for American Families to have more take home pay, to make U.S. Soil a Tax free zone for business that can export around the world Tax-Free. This is how we save American jobs and this is how we compete against substandard wages in a global economy.
The Legislative Package in Congress has been around for several years, it is well researched and has sound economic data to back it up. It is commonly called the FairTax and has over 45 Co-Sponsors in the House and Senate. The bills are HR25 and S25. Congressman John Linder is the lead Sponsor. Congressman Linder and Talk Show Host Neal Boortz have written an informative and sometimes humorous New York Times Best Selling Book called "The Fair Tax Book - Saying Goodbye to the Income tax and the IRS" A great thumbnail overview can be found at : http://www.fairtaxvolunteer.org/smart/sketch.html or visit FAQ section at www.fairtax.org
From an American worker stand point the key point is that the Fair Tax helps save American jobs and promotes American Manufacturing that stays on U.S. Soil. It allows American workers to take home an average 30% larger paycheck each and every week by eliminating any federal withholding for income tax or payroll tax from an American workers paycheck. American workers take home 100% of their paycheck !!
American Manufacturers have the incentive to stay in the US and not outsource because they pay no Corporate tax. New American Manufacturing is created because Capital investment in the US is tax free. Building new plants in the US will cost them less because of lower taxes. The Exports they send overseas pay no tax and are cheaper for sale in the global marketplace. This allows American Manufacturing to compete globally because of lower taxes not lower wages like Delphi is trying to accomplish.
The Fair Tax is a revenue neutral replacement of the individual and corporate Income tax; payroll tax, capital gains tax, the Alternative Minimum Tax (AMT) and the Death Tax(Estate Tax). It is replaced with a National Sales Tax on retail purchases of all new products and services. According to the Legislation, the national sales tax will be included in the price tag you see on a product and will be broken out as a separate line item on your receipt so that Americans know how much they are being taxed and how much they are sending to Uncle Sam with every purchase.
American Families do not have to wait until April 15th to get a refund of their own money, they will take home and average 25% more because of no Income tax withholding and an additional 7.65% because of no payroll tax withholding. Under the Fair Tax the tax collected replaces the income tax that funds the national budget and replaces the payroll taxes that fund Social Security and Medicare.
The Fair Tax can help to strengthen Social Security funding because the sales tax is a much broader tax base than an income tax. In fact, the wealthy will do more to support Social Security under the Fair Tax. Under current Income tax and payroll tax rules the wealthy stop paying into SSI after $90,000 in income. So all the big executives and managers that make more than $90,000 stop putting in to support Social Security. Under the Fair Tax when they buy a $200,000 yacht than some of the Fair Tax goes into SSI. When they throw lavish parties and spend more than most of us would spend in one year on food, the wealthy are supporting the budget and SSI with every purchase with no loopholes or tax breaks for their lawyers to hide their money behind. The wealthy that have millions in investment income were never supporting SSI, now they will every time they spend it on the expensive things they buy. The Fair Tax is fair because it is a flat rate consumption tax. The more you spend the more you pay in tax.
The Fair Tax Legislative package is much more That just a national Sales Tax it is a package that also has a Prebate(rebate) system that truly untaxes the poor and treats everyone equally and fairly. No forms to keep no receipts to log in or file. Everyone gets the same prebate check based on family size and valid Social Security cards for each family member.
Maid or Millionaire ;the simple way to be sure no one pays a national sales tax on the essentials is not complicated exemptions but to simply send each household a monthly check to cover the national sales tax on all spending up to the povertyline for that Family size.
Health and Human Services calculates the poverty line for a married couple with 2 children at $25,660 for the year 2005. The Fair Tax assumes every family of 4 will spend at least that much and sends them a prebate to cover the national sales tax on every dollar up to $25,660. The Inclusive tax rate is 23% or $5,902. The Fair Tax sends each month $492 (5902/12). If that family makes less than $25,660, they still receive the monthly check for $492. It is a fact, if you make more you spend more. Under the Fair Tax if you spend more you pay more. With the Prebate, the Fair Tax is progressive in that the net tax rate for those American families at the poverty line is a true ZERO, for those at twice the poverty line the net rate is about 11.5%; at 4 times poverty that family is about 17.2% and the wealthy at 10 times the poverty line and higher average between a true 20 to 23% net federal tax rate.
This compares to a 10% income tax rate plus 7.65% payroll tax for the lowest paid American who is working full time and recieves the minimum wage. The Earned Income tax credit may offset the minimum wage workers income tax but not the payroll tax.
The Fair Tax truly untaxes the working poor by eliminating the payroll tax of 7.65% and allowing the working poor to take home 100% of their paycheck and receive an additional $5,902/ year to cover the National Sales tax on essentials like clothing, food, housing, or daycare.
The working poor who live at the poverty line of income have a true net federal tax rate of ZERO.
The Fair Tax lowers taxes on the working poor because the consumption tax base is larger than taxing income alone. The overall tax rate for all Americans is lower because of this larger tax base.
Trillions of Offshore dollars that the wealthy and wealthy Corporations hold offshore because of America's current tax laws will return to US shores under the Fair Tax. This capital will find a tax free zone in America and want to invest in American Manufacturing and business that will not only sell to Americans at home but to the entire world. American Exports will not have the 23% national sales tax on them for export. These exportable products will also drop in price because we have removed a major cost element form the supply chain. With no business income or payroll taxes, the cost of those products will go down. With no IRS you reduce the compliance costs dramatically for complying with the IRS rules and regulations. This savings throughout the supply chain will also be reflected in a lower price at home and for export.
It depends on the economist and it depends on the economic model but the estimated price drop on products and services is between 10 and 25% on average. Something you bought for $100 under the income tax will drop to somewhere between $75 and $90 dollars. When you add in the National Sales Tax the final price will be between $97.50 and $117.00.
Under the Income tax to take home $100 you had to earn about $148 if you had a 25% income tax withholding and a 7.65% payroll tax withholding. At a 15% Income tax withholding you had to earn about $129 to take home $100 and buy groceries or put Gas in your car.
Under the Fair Tax you take home more money and you have more money to spend. You take home $148 and spend $117 with the Fair Tax to buy the same $100 worth of goods you bought with $100 in take home pay under the archaic Income and payroll tax system.
Under the Fair Tax Legislative package you lower taxes on business; you give them the incentive to produce and manufacture here within the US and not in China or India , or Mexico. The way to compete in the 21st Century is not to cut our wages in half the way to compete in the world is to provide the incentive for business to do business inside the US. The Fair Tax Legislative package does so much in so many ways. Our American Economy will boom when American manufacturing is growing in the US. The Fair Tax is the best vehicle to do that.
When the Lobbyists and their paid economists come out against it beware. With out the convoluted tax code, Lobbyists, Congressmen, congressional aides and "K" Street will lose a lot of their power and influence. If they come out against it than it must be good for average American families.
Every Politician that came out in support of this idea last election cycle won. This is a winning issue for politicians and when the average American working people are presented all the facts of the Fair Tax 80 to 90% love it. Get the Facts. www.fairtax.org
If Average American workers can get people like Lou Dobb's and Bill O'Reilly to truly study all the facts that support the Fair Tax perhaps we can get them to join the over 75 economists that wrote a letter to Congress last Spring in support of the idea. The Fair Tax is the most comprehensive solution to aid American Workers, American Families, American Manufacturing and the American Economy. www.fairtax.org
by
Merrill Bender
Merrill Bender is a free-lance writer on tax reform and social security reform. For more articles follow his blog at http://fairtaxreform.blogspot.com/ or visit his blog diary at Redstate.org http://merrill-bender.redstate.org/
CNN's Lou Dobbs almost competes with Bill O'Reilly in his level of indignation and outrage on how American Manufacturing Jobs are leaving American Shores. However, they and many other Americans misunderstand and dismiss the serious grassroots support and supporting research for a solution that will truly help the "little guy" and restore good paying American Jobs. (The Fair Tax HR 25/ S25. www.fairtax.org)
The Solution For Delphi and for American Manufacturing in General is not trade barriers or tariffs but is fair trade. But how do you get Fair Trade when competing countries do not pay a Fair Wage? American Workers do not need to compete globally by lowering their wages to such Draconian levels.
American Manufacturing goes where it costs them the least to do business. Even with the higher costs of fuel to ship those goods from overseas the low wage is what helps some countries compete and it is the Lower business taxes that helps other countries compete. In Europe, Ireland has had the strongest economic growth and best employment numbers because they have the lowest taxes on business(Corporate tax 12%)
The Solution for America is Lower Taxes on American Manufacturing not Lower Wages on American Workers. The incentive for business to stay in America and not outsource is lower taxes on Corporate earnings with less tax compliance costs. Ultimately, It is the consumer that pays the business tax in the end on all products and services. Business taxes like business costs for manufacturing are just worked into the price. The Consumer pays the tax not the business.
What if the United States had the lowest Corporate tax in the World. Would not business flock here to manufacture? What if instead of the Bahamas being the Offshore tax haven for business or Corporate headquarters that for Tax purposes those businesses made New York, or California, or Chicago their Corporate home and their preferred place to manufacture from and ship around the World?
There is such a tax plan in Congress waiting in the wings to rev up our Economy, by providing the right incentive for American Manufacturing to stay in America, for Good paying manufacturing jobs not to be outsourced, for American Families to have more take home pay, to make U.S. Soil a Tax free zone for business that can export around the world Tax-Free. This is how we save American jobs and this is how we compete against substandard wages in a global economy.
The Legislative Package in Congress has been around for several years, it is well researched and has sound economic data to back it up. It is commonly called the FairTax and has over 45 Co-Sponsors in the House and Senate. The bills are HR25 and S25. Congressman John Linder is the lead Sponsor. Congressman Linder and Talk Show Host Neal Boortz have written an informative and sometimes humorous New York Times Best Selling Book called "The Fair Tax Book - Saying Goodbye to the Income tax and the IRS" A great thumbnail overview can be found at : http://www.fairtaxvolunteer.org/smart/sketch.html or visit FAQ section at www.fairtax.org
From an American worker stand point the key point is that the Fair Tax helps save American jobs and promotes American Manufacturing that stays on U.S. Soil. It allows American workers to take home an average 30% larger paycheck each and every week by eliminating any federal withholding for income tax or payroll tax from an American workers paycheck. American workers take home 100% of their paycheck !!
American Manufacturers have the incentive to stay in the US and not outsource because they pay no Corporate tax. New American Manufacturing is created because Capital investment in the US is tax free. Building new plants in the US will cost them less because of lower taxes. The Exports they send overseas pay no tax and are cheaper for sale in the global marketplace. This allows American Manufacturing to compete globally because of lower taxes not lower wages like Delphi is trying to accomplish.
The Fair Tax is a revenue neutral replacement of the individual and corporate Income tax; payroll tax, capital gains tax, the Alternative Minimum Tax (AMT) and the Death Tax(Estate Tax). It is replaced with a National Sales Tax on retail purchases of all new products and services. According to the Legislation, the national sales tax will be included in the price tag you see on a product and will be broken out as a separate line item on your receipt so that Americans know how much they are being taxed and how much they are sending to Uncle Sam with every purchase.
American Families do not have to wait until April 15th to get a refund of their own money, they will take home and average 25% more because of no Income tax withholding and an additional 7.65% because of no payroll tax withholding. Under the Fair Tax the tax collected replaces the income tax that funds the national budget and replaces the payroll taxes that fund Social Security and Medicare.
The Fair Tax can help to strengthen Social Security funding because the sales tax is a much broader tax base than an income tax. In fact, the wealthy will do more to support Social Security under the Fair Tax. Under current Income tax and payroll tax rules the wealthy stop paying into SSI after $90,000 in income. So all the big executives and managers that make more than $90,000 stop putting in to support Social Security. Under the Fair Tax when they buy a $200,000 yacht than some of the Fair Tax goes into SSI. When they throw lavish parties and spend more than most of us would spend in one year on food, the wealthy are supporting the budget and SSI with every purchase with no loopholes or tax breaks for their lawyers to hide their money behind. The wealthy that have millions in investment income were never supporting SSI, now they will every time they spend it on the expensive things they buy. The Fair Tax is fair because it is a flat rate consumption tax. The more you spend the more you pay in tax.
The Fair Tax Legislative package is much more That just a national Sales Tax it is a package that also has a Prebate(rebate) system that truly untaxes the poor and treats everyone equally and fairly. No forms to keep no receipts to log in or file. Everyone gets the same prebate check based on family size and valid Social Security cards for each family member.
Maid or Millionaire ;the simple way to be sure no one pays a national sales tax on the essentials is not complicated exemptions but to simply send each household a monthly check to cover the national sales tax on all spending up to the povertyline for that Family size.
Health and Human Services calculates the poverty line for a married couple with 2 children at $25,660 for the year 2005. The Fair Tax assumes every family of 4 will spend at least that much and sends them a prebate to cover the national sales tax on every dollar up to $25,660. The Inclusive tax rate is 23% or $5,902. The Fair Tax sends each month $492 (5902/12). If that family makes less than $25,660, they still receive the monthly check for $492. It is a fact, if you make more you spend more. Under the Fair Tax if you spend more you pay more. With the Prebate, the Fair Tax is progressive in that the net tax rate for those American families at the poverty line is a true ZERO, for those at twice the poverty line the net rate is about 11.5%; at 4 times poverty that family is about 17.2% and the wealthy at 10 times the poverty line and higher average between a true 20 to 23% net federal tax rate.
This compares to a 10% income tax rate plus 7.65% payroll tax for the lowest paid American who is working full time and recieves the minimum wage. The Earned Income tax credit may offset the minimum wage workers income tax but not the payroll tax.
The Fair Tax truly untaxes the working poor by eliminating the payroll tax of 7.65% and allowing the working poor to take home 100% of their paycheck and receive an additional $5,902/ year to cover the National Sales tax on essentials like clothing, food, housing, or daycare.
The working poor who live at the poverty line of income have a true net federal tax rate of ZERO.
The Fair Tax lowers taxes on the working poor because the consumption tax base is larger than taxing income alone. The overall tax rate for all Americans is lower because of this larger tax base.
Trillions of Offshore dollars that the wealthy and wealthy Corporations hold offshore because of America's current tax laws will return to US shores under the Fair Tax. This capital will find a tax free zone in America and want to invest in American Manufacturing and business that will not only sell to Americans at home but to the entire world. American Exports will not have the 23% national sales tax on them for export. These exportable products will also drop in price because we have removed a major cost element form the supply chain. With no business income or payroll taxes, the cost of those products will go down. With no IRS you reduce the compliance costs dramatically for complying with the IRS rules and regulations. This savings throughout the supply chain will also be reflected in a lower price at home and for export.
It depends on the economist and it depends on the economic model but the estimated price drop on products and services is between 10 and 25% on average. Something you bought for $100 under the income tax will drop to somewhere between $75 and $90 dollars. When you add in the National Sales Tax the final price will be between $97.50 and $117.00.
Under the Income tax to take home $100 you had to earn about $148 if you had a 25% income tax withholding and a 7.65% payroll tax withholding. At a 15% Income tax withholding you had to earn about $129 to take home $100 and buy groceries or put Gas in your car.
Under the Fair Tax you take home more money and you have more money to spend. You take home $148 and spend $117 with the Fair Tax to buy the same $100 worth of goods you bought with $100 in take home pay under the archaic Income and payroll tax system.
Under the Fair Tax Legislative package you lower taxes on business; you give them the incentive to produce and manufacture here within the US and not in China or India , or Mexico. The way to compete in the 21st Century is not to cut our wages in half the way to compete in the world is to provide the incentive for business to do business inside the US. The Fair Tax Legislative package does so much in so many ways. Our American Economy will boom when American manufacturing is growing in the US. The Fair Tax is the best vehicle to do that.
When the Lobbyists and their paid economists come out against it beware. With out the convoluted tax code, Lobbyists, Congressmen, congressional aides and "K" Street will lose a lot of their power and influence. If they come out against it than it must be good for average American families.
Every Politician that came out in support of this idea last election cycle won. This is a winning issue for politicians and when the average American working people are presented all the facts of the Fair Tax 80 to 90% love it. Get the Facts. www.fairtax.org
If Average American workers can get people like Lou Dobb's and Bill O'Reilly to truly study all the facts that support the Fair Tax perhaps we can get them to join the over 75 economists that wrote a letter to Congress last Spring in support of the idea. The Fair Tax is the most comprehensive solution to aid American Workers, American Families, American Manufacturing and the American Economy. www.fairtax.org
by
Merrill Bender
Merrill Bender is a free-lance writer on tax reform and social security reform. For more articles follow his blog at http://fairtaxreform.blogspot.com/ or visit his blog diary at Redstate.org http://merrill-bender.redstate.org/