Friday, April 9, 2010


Obama economic adviser Paul Volcker told the New York Historical Society that a Value Added Tax (VAT) should be considered to get the deficit under control. For good measure, he threw in taxes on carbon and energy. He said getting entitlement costs and the US budget deficit under control may require such moves.

The VAT concept was born in France in 1954. More 100 money-hungry governments around the world have adopted variations of the VAT. Basically, it is a national sales tax imposed on virtually everything sold, with collections at every sales point (where value is added) from origin to ultimate consumer. Like a traditional sales tax, it is relatively efficient and inexpensive to collect. A VAT is easy to increase as desired with little notice by the consumer.

Perhaps the most egregious characteristic of a VAT is that, unlike a traditional sales tax, most of it is hidden in the ultimate cost of the goods. The final purchaser does not know how much he's paying in taxes when he buys a product. I oppose any form of a VAT because it hides the cost of government from the governed. And, it goes contrary to Obama's promise of an open and transparent government.

A billion here, a billion there, sooner or later it adds up to real money. — Everett Dirksen

I have a better idea: Eliminate all federal programs that are outside the authority granted to the federal government by the Constitution! That includes sunsetting all so-called "entitlement" programs that dish out billions in unearned payments and benefits to people who have done nothing to earn them!

Any form of a VAT is unacceptable either as a substitute for current taxes or to augment any other tax. All we need is a Congress and President with the courage and integrity to oppose any form of a VAT and cut government size and power instead!

Government is like a baby: An alimentary canal with a big appetite at one end and no sense of responsibility at the other. — Ronald Reagan

A government which lays taxes on the people not required by urgent public necessity and sound public policy is not a protector of liberty, but an instrument of tyranny. — Calvin Coolidge

Before we give you billions more, we want to know what you've done with the trillion you've got. — Les Aspin

Giving money and power to government is like giving whiskey and car keys to teenage boys. — PJ O'Rourke

After a decade of profligacy, the American people are tired of politicians who talk the talk but don't walk the walk when it comes to fiscal responsibility. It's easy to get up in front of the cameras and rant against exploding deficits. What's hard is actually getting deficits under control. But that's what we must do. Like families across the country, we have to take responsibility for every dollar we spend. — Barack Obama, 2010

Recommended book:
Costly Returns: Burdens of the US Tax System
Costly Returns: Burdens of the US Tax System

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