Guest Column----“Facts and the Fair Tax” by Mike Huckabee
It is unfortunate that you have consistently written with contempt about the Fair Tax, but have obviously done so without bothering to conduct even the most perfunctory research on what it actual does and does not do. I expect that kind of “shoot first, aim later” approach from the local tabloids, but the Democrat-Gazette editorial staff is better than your understanding of the Fair Tax would reflect.The Fair Tax is hardly a “half-baked” idea. It is the result of over $22 million dollars of scholarly research involving economists from Harvard, MIT, Stanford, University of Chicago, Boston University, and other prestigious universities.
In a nutshell, the Fair Tax is a flat tax, but instead of taxing our productivity (income, investment, savings, capital gains, or inheritance), we are taxed at the point of consumption at the retail level on new items. It is flat, fair, finite, and family friendly. It is totally transparent, unlike the hideous tax structure we currently have and is not a VAT that assesses taxes at production points, but remains largely hidden to the consumer. The criticism that it would “hurt the poor” is the surest evidence that the critic is ignorant of the pre-bate built into the fair tax, which un-taxes consumption of our basic necessities, and which the studies show actually creates the greatest benefit to those in the lower third of the economy, significant benefit to the middle third of the economy, and some benefit, but less to those in the top third of the economy.
Here’s what the Fair Tax will do:
Unfortunate and misguided or perhaps dishonest statements have been made about the Fair Tax, some of which stems from the utterly nutty critique some years ago by Robert Bartley of the Wall Street Journal who went so far as to try and allege that the Fair Tax was a secret plot of the Church of Scientology. Some point to a supposed study of the Fair Tax by the Bush administration, which was a consumption tax, but not one that involved the all critical pre-bate. Some simply fail to understand the power of the pre-bate for low income earners or have failed to recognize how significantly the political dynamics of Washington would change if Congress were no longer able to manipulate the tax code so as to create winners and losers according to the whims of Congress rather than to the
free marketplace. The so-called “sticker shock” of a 23% tax rate seems ominous until one realizes that with the various payroll taxes, hidden taxes in our purchases, etc., the average American already pays almost 33% in taxes now at the federal level.The Fair Tax would be a legitimate economic stimulus package by creating a level playing field for manufacturing. When U. S. companies are having to factor in the embedded taxes on our side, but our competitors in China don’t, we have a hard time keeping our manufacturing and our jobs here.
I recommend that one read “The Fair Tax” by Congressman John Linder and Neal Boortz or the follow-up book by the same authors, “The Fair Tax Answers,” or go to fairtax.org and then at least base whatever criticism on something other than internet chatter and less than complete understanding of the facts of the Fair Tax.