As most of you know the House Ways & Means Committee (W&M) agreed last month to hold a hearing on the FairTax on July 26. The initial excellent list of people expected to testify for the FairTax included Governor Mike Huckabee, Professor David Tuerck, Dan Mastromarco – drafter of the original FairTax bill, Dr. Wayne Angel – Former Federal Reserve Governor, Congressman Rob Woodall, & Dr. Karen Walby – Chief Economist for AFFT.
It didn't take long for W&M to alter the agenda or the list of testifiers. First, it was announced that the hearing would be a study of consumption taxes rather than devoted exclusively to the FairTax & the time allowed for the FairTax was reduced in order to allow a second panel to testify on value added taxes (VATs). Second, the above list of experts was ignored & W&M selected Professor Lawrence Kotlikoff (a name taken from the AFFT website) to join Governor Huckabee. Thankfully Professor Kotlikoff was successful in getting permission for Professor Tuerck to assist him. The Democrats appointed long time FairTax critic Bruce Bartlett to present anti-FairTax positions.
The actual hearing went down hill from here. The VAT panel consisted of six people & the FairTax panel had four. Kotlikoff explained that he was not "a FairTax guy" & spoke of the importance of retaining the IRS, collecting an imputed tax on services (rent) for owner-occupied homes, & explaining his endorsement of a so-called "purple tax" that he has concocted - in between he did say a few things favoring the FairTax. With friends like this you can't afford many enemies on the witness stand. Huckabee had to leave early to catch a plane for Lord knows where leaving Kotlikoff as the principle protagonist for the FairTax which gave him more time to explain the "purple tax." Bartlett presented his usual list of misinformation including how the FairTax handles the taxing of new houses & of course his favorite distortion - the taxing of government services under the FairTax. Answers to all of Bartlett's monotonous points (but thought provoking points if you don't know better, which most people don't) can be found on ReturnToExcellence.net under "The FairTax" on the left hand side of the blog.
The Democrats on W&M repeatedly revealed their hand. One called the FairTax a "Fairy Tale Tax," another called it the "unfair tax," & NJ's Pascrell called it a "foolish proposal." Some Democrats just said they were against it – so much for an unbiased hearing.
Now I never favored the idea of this W&M hearing re the FairTax to begin with but I didn't think it would deteriorate to such a low point the way it did. Despite all of the work & effort there simply is not the thousands of active supporters that is required in every congressional district yet to call for such a hearing & make the result successful. I am afraid the hearing is cover for W&M to recognize that consumption taxes are excellent revenue generators & that either the FairTax or a VAT is great in this regard & as such the committee then starts the process of adopting a VAT in addition to the income tax of course. BO will be only too happy to sign such a bill if he wins reelection. This hearing sets the stage for such an event.
The hearing illustrates the exercise in futility it is to pursue individual Members of Congress especially once it becomes obvious they have other agendas for themselves & America & accordingly no intention of supporting the FairTax. Such a pursuit will only burn out FairTax supporters. Our best immediate hope for passage of the FairTax lies in finding a presidential candidate who unabashedly runs on the FairTax & through his leadership convinces & inspires a majority of the 70% of income earners who pay little or no income taxes, but who do vote, that the FairTax is best for America's future - he has to convince them that they really do have skin in the game in that their entire standard of existence is @ stake on the road we are travelling. This type of leadership will have to catch the imagination & inspiration of most of the youth, black, & Hispanic voters. This is where the constant consistent beating of the drum of spreading the FairTax word by all of you to everyone who will listen - with no quit or fatigue whatsoever - will pay off for our country. Start with your next door neighbor – have you told him about the FairTax?
Good points. The combination of a strong FairTax Candidate with the emotional and popular support of the FairTax by the voters is the only chance The FairTax has.
ReplyDeleteThey have to maintain the 51% voting block.
ReplyDeleteIn addition to the "unbiased" hearing it was given where, as you mentioned, many Democrats already had an unfavorable opinion of it, did you notice how the seats (nearly filled in the beginning) gradually emptied as time rolled on? It's like "I'm done making my attacks, I don't need to hear anything more."
ReplyDeleteIt's sick the way these corrupt politicians work. Every one of them need to be voted out immediately, but as you also alluded to, we don't have the grassroots movement needed to do that at this point.
The only thing I can say is keep trudging along. We'll eventually get there; as long as we don't give up.
Thanks for this article, I look forward to more from you. Please check out my blog and follow me on twitter @TXFairTaxer
Good analysis, and quite different from the official "Reflections" found on the Fairtax website. Larry K doesn't even support the Fairtax anymore, and his Purple tax reform proposal is quite a bit worse than the Fairtax, imho.
ReplyDeleteRather than trudging along and trying to push a wet noodle uphill, is anyone ready to try a simpler approach? If you really want to get rid of the hated income tax, it can be done with a 10% consumption tax as long as you leave FICA alone, leave gift/estate taxes in place, target the prebate at around the same cost as the EITC, forget about any inventory tax credits, don't tax governments, and phase it in over five years or so. I call it Fairtax-Lite, and it draws on many criticisms developed over the last five years. If you believe we should walk before running, than Lite might appeal to you.
Yes, a Fair tax candidate is necessary. You would think it would be a shoe in for the people. Gets rid of the corrupt IRS and getting free money for doing nothing? (simplified of course)
ReplyDelete