George Will On the VAT Tax and Manufactured Crisis

The following two links are to the same article, the first subject line from The Washington Post, and the second from Townhall.com, speaking of which, here’s a video from Townhall.com with recent news that might interest you:

A plan to tax everybody and George Will: If VAT, Ditch the Income Tax. There are a couple of things I want to say relative to this article. One about the VAT tax, and the other about his statement that Obama’s actions as president knowingly create a crisis to facilitate a sales pitch of further expansion of government; an assertion more common from a Glenn Beck or Rush Limbaugh than the more temperate and obliging George Will. I’ll try to address both, quickly. First, I’d agree with Will and think the Republican Senate should make clear that there will never be any sort of national sales tax absent a prior repeal of the 16th Amendment allowing an income tax. Though there are distasteful things about a VAT and I would much prefer a more transparent national retail sales tax like The Fair Tax, even a VAT would be superior IF it replaced the income tax. For one thing, as with a NRST, EVERYONE would pay according to what they spend. No more hordes of people voting to raise taxes on others, in relative ignorance of how those taxes will effect economic growth and opportunity. And even bigger really, no more filing and paying for tax preparation and evasion. No loopholes and evasions for the most able to avoid taxes. You buy, you pay: end of story. And it would be a source of revenue more reliable and indicative of relative economic health. But it can’t be permitted without elimination of the 16th Amendment.

A retail sales tax is superior because it is not largely hidden. If government needs 25% of the economy, it asks for a retail sales tax of 25%. A Value-Added Tax is applied at every level of business. With a 10% VAT, If you are buying a computer for example, when the base materials are mined, extracted, or grown, the company that does it is taxed 10%. When they pass the product on to a refiner, chemical company, or fabricator, that company pays 10% on its product. When that metal or plastic or liquid is made into a metal or plastic piece, another company pays 10%. When those components are fashioned into part of a board, plug, case or peripheral of the system, that is another 10%. When a company puts the system together to sell to a retailer, another 10%. When a retailer sells it to you, you pay 10% of their price, which already includes a boatload of taxes. The plastic or metal in the system, has been taxed several times. The end-user price is hugely inflated, and government is very happy. So, when there is a VAT, prices will increase enormously. Trust me, you ABSOLUTELY DO NOT WANT a VAT AND an income tax.

Now, as for whether Obama is knowingly sabotaging the economy, it is my suspicion that he is, and Beck for example has often referred to the Cloward-Piven strategy of manufactured crisis. Ultimately, I don’t know what the intentions are, but I do know that ideology can dictate what seems like crazy ideas. In philosophy, intelligent and rational people reach opposite conclusions based on different assumptions. But, it is also a fact that Cloward-Piven was an actual strategy of 60’s academics to impose radical change via induced crisis.

For me, at bottom ideas are right or wrong regardless of sincerity or deceit. And, though he may underestimate malign intentions, I ultimately agree with Michael Medved that it is important to focus on the worthiness of ideas. To insist that others are atrocious people is a distraction from the flaws of the ideas and unhelpful if not counterproductive in the effort of persuasion. Still, they are getting awfully sloppy in their presentation when George Will can’t give them the benefit of ignorance.