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I have meant to talk about this for a while…and here it goes.  It does seem odd that this is a topic that needs discussion, that we should combine these topics and draw parallels between them.  But, I think this is important.

For anyone who knows anything about the three laws, Newton’s laws of physics, that the third law is for every action there is an equal and opposite reaction.  This make sense in physics perfectly, you hit a wall, you break the bones in your hand.

But our current government seems  bent on ignoring these laws, and other Laws of Economics.

So just what is the opposite reaction to bigger and more government? Why even comment on this topic?

The exact opposite reaction to more and more government programs is that there is more ability to find loopholes and to have people game the system.  It’s a natural part of life, none of us can change it.

It also encourages people to find a way to game the system and use it for their advantage.  If everyone understood the rules of the game, had the same rules of the game, and they were simple enough to enact quickly then everyone would know those rules, and people who broke these rules could be dealt with quickly and effectively.

It’s like the hate laws.  Why add another law to the books…when murder is already illegal.  If they are guilty then they deserve punishment.

Anyways I digress.

If you think I am wrong then consider the current tax code of the United States of the IRS.  It is over 6000 pages long of text legal laws of how United States citizens do their taxes.

It is such a complicated mess of words and legality that you must have an army of lawyers just to figure it out.

Such a mass of contradictions that it actually encourages people to game the system, to lie, to steal, to cheat, and to squeeze every penny out of the system you can.  Legally, but occasionally immoral.

And that is only if you have the best intentions.  For corrupt people, it can still be used as a weapon, to come after you and try to intimidate you into submission.  But if yet you get caught with it and you are on the right side…you are forgiven…why you did it just to help people.

Or any number of programs, if you give people an excuse, they will find it.

The best solution would be to simplify things so everyone can understand what is going on so that they can know how to react, and the guilty punished.

Simplicity, the opposite reaction is a greater ability to know the issues.

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9 Comments

  1. Taxing people based on how much they make or the value of their property does nothing to heal the divide between rich and poor and everything to promote it. Taxing people based on how much they consume is much fairer…with a prebate provision so that the poor are not disproportionately burdened by this consumption tax. If we changed to this kind of system people would have more money in their pockets….money that they could donate to charities that will actually help liberate people from poverty rather than keep them in it with government welfare designed to buy their vote.

    • I do agree with you completly, Joe (can I call you Joe?:P), but I still get a little uneasy about the prebate provision in the fair tax. To me that still strikes as redistribution of wealth, socialism, and just not good, and might just lead to the very same thing that it is meant to stop. Class warfare. It would still encourage someone to be partially poor or not, and still would cause class envy. I do not think as bad, and in the end it is a noble idea, but a lot of noble ideas have been used to ignoble things in rescent history.

    • I do like the idea of taxing people on how much they consume. On paper it looks to be a good idea. I’ve always made a point to have a minimalist lifestyle, even when my income was much more than it is now. That lifestyle has served me well in the past and would be even more effective with the fair tax. I can’t necessarily control my much income that much because bosses determine that (or consumers if I run a business). But I definitely have much more control over how much I consume.

      But knowing how the folks in Washington work, I can imagine so many provisions that the end result may end up being more complex than the 6000-page system we have in place right now.

        • colfoley
        • Posted January 30, 2010 at 1:54 am
        • Permalink

        indeed. I love the fairtax. But I am not quite comfortable with our current leader ship being able to execute it properly.

  2. I like simplicity that is always good….but sometimes you can move from the ridiculous to sublime and be no better off. As for the Fair Tax…..I too am a bit leary of how appropriately it could be executued fairly. Take this for instance….it states that exemptions from the tax could be made for property or services purchased for business, export, or investment purposes, and for state government functions. IDK…but this makes me a tad bit nervous. I mean I could see people who owned businesses filtering alot of their own personal purchases through their businesses and or claiming alot or their purchases were for “investments” I mean my point is I see loopholes here…and you know if the system can be “tweaked” or as you mentioned “gamed” it will be. So I agree we need simplier….but lets not throw the baby out with the bathwater….I think this really needs to be looked at long and hard first.

  3. I never said it was perfect. I too have thought long and hard about the “prebate” provision in the current FairTax write-up. And if they’ll be giving breaks to business people, people in the export industry, or investors, then yeah it would be no different from what we have now. If we went to a system like the FairTax the only exemption from the tax should be if the person is buying supplies for a non-profit institution.

    • exactly right 🙂

      I think though that it should be on new goods and services…the way I have always understood it anyways….because in that event people will be able to chose what they want to buy and the tax burden on the ‘poor’ would be a lot less given the fact that the poor do not buy a lot of things that are new goods and services.

  4. here’s the FAQ page for the FairTax:

    http://www.fairtax.org/site/PageServer?pagename=about_faq_answers#1

    from what I read businesses wouldn’t exactly be getting a tax break as we understand a tax break….as I understand it business expenditures would be tax exempt (both for profit and not for profit businesses) thus providing an environment where these businesses (again either for profit or not for profit) can grow and expand


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