Comment Re:Or a simple way to fix it. (Score 1) 839
As I stated in my other post, I am not proposing the fair tax, it is most aggressive and does exactly what you say it does. I am proposing a tax system that shifts the burden upwards so that the more income one makes, the more taxes one pays. Fair tax usually is a consumption tax, which is a glorified sales tax. Almost all fair tax proposals includes some kind of payment to the poor to help them out with it. However, if it were truly fair, there wouldn't be a need for this payment.
In the 1960s, when the US had some of its greatest increases in GDP, the tax rate was pretty high. What drove the economy was the purchasing power of the middle class. However, since the 1980s, tax law has shifted more and more of the tax burden onto the middle class, pushing many downward and for those who remain, they have less spending ability because of the higher tax burden. As such, the economy has faltered and for the most part has been sustained by consumer debt to make up for the reduced purchasing power. However, debt financing can only go so far before it catches up to you, like it has now, which is why we have companies reporting record profits, paying record dividends and high unemployment.
The mantra "Don't tax the job creators" is a fallacy. Taxing the wealthy doesn't hurt jobs, if the tax burden is lifted from the middle class. Demand for goods and services creates jobs and most of that demand has come historically from the middle class. Policy in the US should be to restore the middle class, at least if we want a strong economy. No "job creator" is going to higher people if there isn't a demand for the goods and services that the employees provide. On the other hand, they will regardless of the tax burden if there is somebody to consume those goods and services. That's the whole idea behind supply and demand.
The "fair tax" is anything but fair. We need to return to a system that taxes people based on their ability to support the needs of the society they are in. That is the system that built America and made it strong.