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From: Joerg on 23 May 2010 11:55 John Larkin wrote: > On Sun, 23 May 2010 08:05:55 -0700, Joerg <invalid(a)invalid.invalid> > wrote: > >> John Larkin wrote: >>> On Sat, 22 May 2010 20:43:16 -0500, "krw(a)att.bizzzzzzzzzzzz" >>> <krw(a)att.bizzzzzzzzzzzz> wrote: >>> >>>> On Sat, 22 May 2010 12:36:06 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>> >> [...] >> >>>>> and will be mighty miffed if he's a retiree. >>>> *That* is the component I'm not happy about. I don't see anyone addressing >>>> it, either. >>> Most retirees already have houses, furniture, pots and pans, so won't >>> pay a huge amount of sales tax. Basic survival stuff could be >>> exempted. And a lot of retirees have taxable income, which taxes will >>> go away. >>> >>> No change is going to please everybody. >>> >>> The nice thing about a sales tax is that you can elect to not buy >>> stuff and not pay the tax. >>> >> This definitely does not work for most people. You might be lucky like >> my great grandpa who died shortly before his 103rd birthday in his >> sleep, and never saw a hospital as a patient (other than MASH units >> during war time). Most of us will eventually have to sell their homes or >> that nice cabin in Truckee or give it to the kids, then buy a place in >> an assisted living village. Since such a "fair tax" will likely trigger >> a stampede out of cash all the exisiting units there will have been >> snapped up already so you must buy a newly constructed one. Meaning >> you'll be socked with tax and fictitious rent tax. > > The current tax system is destroying jobs. If we keep it forever > because some retirees like things the way they are, their kids and > grandkids will live under the current mess. Any change will > inconvenience someone. > > Taxing consumption and not income or profits will create jobs and > encourage people to keep working. > > http://www.nytimes.com/imagepages/2010/05/23/global-home/23europe-graphic.html?ref=europe > What is destroying jobs is not the tax system per se, although tweaks by certain political interests will. Such as the temp worker crackdown that was announced. How that can possibly be announced at these economic times is beyond me. What needs to be done is reel in spending. Case in point: CalPERS just sent the state a bill upping the payment by the state by (IIRC) 18%. Largely because they had screwed up. By law (!) the state must pay whatever they please to bill. How sick is that? -- Regards, Joerg http://www.analogconsultants.com/ "gmail" domain blocked because of excessive spam. Use another domain or send PM.
From: krw on 23 May 2010 15:23 On Sat, 22 May 2010 22:32:16 -0700, John Larkin <jjlarkin(a)highNOTlandTHIStechnologyPART.com> wrote: >On Sat, 22 May 2010 23:05:29 -0500, "krw(a)att.bizzzzzzzzzzzz" ><krw(a)att.bizzzzzzzzzzzz> wrote: > >>On Sat, 22 May 2010 19:19:25 -0700, John Larkin >><jjlarkin(a)highNOTlandTHIStechnologyPART.com> wrote: <snip> >>>Most retirees already have houses, furniture, pots and pans, so won't >>>pay a huge amount of sales tax. Basic survival stuff could be >>>exempted. And a lot of retirees have taxable income, which taxes will >>>go away. >> >>A lot of people downsize their homes after they retire. That money (capital >>gains) is currently not taxed but will be under the "fair" tax. > >I don't know about a "fair" tax. What I suggest is a sales tax, a tax >on consumption. It could easily exempt capital gains, which isn't >sales or consumption. Again you're missing the point. The point is that these folks have used their house as savings - the *largest* part of their life's savings for most. Currently this savings is exempted from taxes (up to 1/2M for married). Put in a consumption tax and this savings is now taxed the same as income. ...even the after-tax part (principal) of this savings. >>>No change is going to please everybody. >> >>Penalizing those who have played the game according to the rules is not >>"fair". It's no better than what Obummer is doing to business. >> >>>The nice thing about a sales tax is that you can elect to not buy >>>stuff and not pay the tax. >> >>Not under the "Fair Tax". *Everything* is taxed, even homes. AIUI, only new >>houses have the tax charged, but the cost difference between new and old has >>to equalize. > >So tune it. That's how we got in this mess; Congress "tuning" the tax code.
From: krw on 23 May 2010 15:26 On Sun, 23 May 2010 04:43:23 -0700, "JosephKK"<quiettechblue(a)yahoo.com> wrote: >On Sat, 22 May 2010 23:05:29 -0500, "krw(a)att.bizzzzzzzzzzzz" ><krw(a)att.bizzzzzzzzzzzz> wrote: > >>On Sat, 22 May 2010 19:19:25 -0700, John Larkin >><jjlarkin(a)highNOTlandTHIStechnologyPART.com> wrote: >> >>>On Sat, 22 May 2010 20:43:16 -0500, "krw(a)att.bizzzzzzzzzzzz" >>><krw(a)att.bizzzzzzzzzzzz> wrote: >>> >>>>On Sat, 22 May 2010 12:36:06 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>> > ><SNIP> > >>>>He won't pay income tax or employment (SS) tax and neither will the >>>>corporations paying him and selling him his stuff. >>>> >>>>>and will be mighty miffed if he's a retiree. >>>> >>>>*That* is the component I'm not happy about. I don't see anyone addressing >>>>it, either. >>> >>>Most retirees already have houses, furniture, pots and pans, so won't >>>pay a huge amount of sales tax. Basic survival stuff could be >>>exempted. And a lot of retirees have taxable income, which taxes will >>>go away. >> >>A lot of people downsize their homes after they retire. That money (capital >>gains) is currently not taxed but will be under the "fair" tax. > >A. That is a recent tax law change. If you want to call 20 years, "recent". >B. The delta price in existing homes due to fair tax will be split about >50/50 between buyer and seller. Rectal extraction? Why would the buyer get anything? >>> >>>No change is going to please everybody. >> >>Penalizing those who have played the game according to the rules is not >>"fair". It's no better than what Obummer is doing to business. > >And healthcare. Ok. Both will be dead within a decade. >>>The nice thing about a sales tax is that you can elect to not buy >>>stuff and not pay the tax. > >Except for food and utilities. Right. That's the regressive part of the tax. >>Not under the "Fair Tax". *Everything* is taxed, even homes. AIUI, only new >>houses have the tax charged, but the cost difference between new and old has >>to equalize. Which is why the buyer won't get anything.
From: krw on 23 May 2010 15:31 On Sun, 23 May 2010 08:00:00 -0700, Joerg <invalid(a)invalid.invalid> wrote: >krw(a)att.bizzzzzzzzzzzz wrote: >> On Sat, 22 May 2010 12:36:06 -0700, Joerg <invalid(a)invalid.invalid> wrote: >> >>> krw(a)att.bizzzzzzzzzzzz wrote: >>>> On Sat, 22 May 2010 12:10:57 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>> >>>>> krw(a)att.bizzzzzzzzzzzz wrote: >>>>>> On Sat, 22 May 2010 09:38:20 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>>>> >>>>>>> krw(a)att.bizzzzzzzzzzzz wrote: >>>>>>>> On Sat, 22 May 2010 08:52:24 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>>>>>> >>>>>>>>> krw(a)att.bizzzzzzzzzzzz wrote: >>>>>>>>>> On Sat, 22 May 2010 03:08:36 -0700, "JosephKK"<quiettechblue(a)yahoo.com> wrote: >>>>>>>>>> >>>>>>>>>>> On Fri, 21 May 2010 12:45:07 -0700, Joerg <invalid(a)invalid.invalid> >>>>>>>>>>> wrote: >>>>>>>>>>> >>>>>>>>>>>> JosephKK wrote: >>>>>>>>>>>>> On Thu, 20 May 2010 07:47:38 -0700, Joerg <invalid(a)invalid.invalid> >>>>>>>>>>>>> wrote: >>>>>>>>>>>>> >>>>>>>>>>>>>> JosephKK wrote: >>>>>>>>>>>>>>> On Wed, 19 May 2010 16:30:12 -0700, Joerg <invalid(a)invalid.invalid> >>>>>>>>>>>>>>> wrote: >>>>>>>>>>>>>>> >>>>>>>>>>>>>>>> krw(a)att.bizzzzzzzzzzzz wrote: >>>>>>>>>>>>>>>>> On Wed, 19 May 2010 15:27:01 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>> krw(a)att.bizzzzzzzzzzzz wrote: >>>>>>>>>>>>>>>>>>> On Wed, 19 May 2010 09:42:44 -0700, Joerg <invalid(a)invalid.invalid> wrote: >>>>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>>>> dagmargoodboat(a)yahoo.com wrote: >>>>>>>>>>>>>>>>>>>>> On May 18, 2:46 pm, Charlie E. <edmond...(a)ieee.org> wrote: >>>>>>>>>>>>>>>>>>>>>> On Mon, 17 May 2010 14:31:43 -0700 (PDT), dagmargoodb...(a)yahoo.com >>>>>>>>>>>>>>>>>>>>>> wrote: >>>>>>>>>>>>>>>>>>>>>> <major snippage and attributions...> >>>>>>>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>>>>>>> $1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people >>>>>>>>>>>>>>>>>>>>>>> (AIUI). The rest goes to taxes hidden in the item's price. >>>>>>>>>>>>>>>>>>>>>>>> If I tax-deferred the >>>>>>>>>>>>>>>>>>>>>>>> $1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that >>>>>>>>>>>>>>>>>>>>>>>> is socked away before the change) gets hammered *twice*. >>>>>>>>>>>>>>>>>>>>>>> If you had tax-deferred the $1.40, you'd escape the indignities of the >>>>>>>>>>>>>>>>>>>>>>> old system. That's a windfall (assuming Congress allows it). >>>>>>>>>>>>>>>>>>>>>>> Going forward though, with income-taxed money, the $1 we have left >>>>>>>>>>>>>>>>>>>>>>> still buys the same with or without the Fair Tax. $1 with embedded >>>>>>>>>>>>>>>>>>>>>>> tax burden hidden inside it, or ($0.77 actual price + $0.23 Fair Tax) >>>>>>>>>>>>>>>>>>>>>>> both cost you $1 at the register. No loss of purchasing power. >>>>>>>>>>>>>>>>>>>>>>> That's the contention, AIUI. >>>>>>>>>>>>>>>>>>>>>> The other false assumption is that the price would drop >>>>>>>>>>>>>>>>>>>>>> instantaneously to $.77 as soon as the tax was passed. >>>>>>>>>>>>>>>>>>>>> I don't assume that. There are all sorts of 2nd and 3rd-order >>>>>>>>>>>>>>>>>>>>> effects. >>>>>>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>>>>>> In reality, >>>>>>>>>>>>>>>>>>>>>> the price stays at $1.00, and the retailer uses this 'profit' to pay >>>>>>>>>>>>>>>>>>>>>> off his loans. Now, as time goes by, prices 'might' drop, but I >>>>>>>>>>>>>>>>>>>>>> wouldn't bet on it. I actually expect prices to rise. >>>>>>>>>>>>>>>>>>>>> I expect prices to fall, quickly. Like with gasoline there's a delay >>>>>>>>>>>>>>>>>>>>> for goods-in-transit, then market forces handle the rest. >>>>>>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>>>> Why would a Japanese car or Chinese-made flatscreen TV fall in price >>>>>>>>>>>>>>>>>>>> quickly? >>>>>>>>>>>>>>>>>>> Because there is more than one manufacturer. >>>>>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>>>> With consumer electronics the number of manufacturers inside the US is >>>>>>>>>>>>>>>>>> often zero. >>>>>>>>>>>>>>>>> I don't see the relevance. >>>>>>>>>>>>>>>> The relevance is this: >>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>> When a group of "experts" claims the price of goods will fall because >>>>>>>>>>>>>>>> the income tax burden of the labor in a product will drop by 23 percent >>>>>>>>>>>>>>>> that assumption is flawed for two reasons: >>>>>>>>>>>>>>>> >>>>>>>>>>>>>>>> a. Most consumer products are from China and, consequently, not one iota >>>>>>>>>>>>>>>> will change in the tax on labor. The only cost that changes is the labor >>>>>>>>>>>>>>>> associated with the sales and distribution process but that's miniscule. >>>>>>>>>>>>>>> I don't think so. The final retail distribution is rather expensive and >>>>>>>>>>>>>>> labor cost driven. Take a look at the volume pricing at Digikey for >>>>>>>>>>>>>>> example. >>>>>>>>>>>>>> I am looking at Walmart and Costco. There's nobody working there that'll >>>>>>>>>>>>>> crack one can of pickles out of a 4-pack. You either buy the 4-pack or >>>>>>>>>>>>>> you don't have pickles for lunch :-) >>>>>>>>>>>>>> >>>>>>>>>>>>> You are confusing unit of issue, intentional recruiting at minimum wage, >>>>>>>>>>>>> and business designed for those conditions with price per unit and delta >>>>>>>>>>>>> price per unit versus volume. >>>>>>>>>>>> What's confusing about this? Whether it's Walmart or Amazon or whatever, >>>>>>>>>>>> competition forces such places to live on rather slim margins. The same >>>>>>>>>>>> is true in the auto business. Yeah, the dealer/middleman might make >>>>>>>>>>>> $1k-$2k but the other $15k go to Japan or Korea. >>>>>>>>>> Few cars sold in the US are made in Japan or Korea. >>>>>>>>>> >>>>>>>>> Mine was made in Nagoya. >>>>>>>> Why do you insist that anecdote = data? >>>>>>> Why do you think the NUMMI plant was shut down? It might get a little >>>>>>> glimmer of hope now that Tesla wants to build electric cars there in a >>>>>>> little corner of that huge plant. But Toyota doesn't build there >>>>>>> anymore, that's now history. >>>>>> Why do you think Toyota moved out of Kalifornica? Why haven't you? ... >>>>> Ever tried to sell a house here lately? >>>> You didn't see this coming? What has changed since Grayout Davis? >>>> >>> It's kind of tough to live out of state while running a business :-) >> >> Businesses can be run from just about anywhere. >> > >Not this one. It was high-tech and the market expected major new >features at every key trade show, and those happen yearly. Losing half >your engineers (and we would have likely lost even more) can then be >catastrophic. I thought your business was you. >>> Besides, we are quite firmly entrenched in community, church and >>> volunteering out here. Especially my wife, if she left with me that >>> would cause a lot of sadness in some assisted living places around here. >> >> So it's not about selling your house. ;-) >> > >True, financial things matter much less in our lives compared to higher >callings. Those higher callings aren't going to matter much when you're broke and your neighbors are now Jim's neighbors. ;-) > >>>>>> ... Toyota >>>>>> still manufactures a *lot* of their NA cars in the US. Hundai has a plant >>>>>> fifty miles down the road from me and Kia has a new plant 30 miles the other >>>>>> way. >>>>>> >>>>>>> Oh, and AFAIK many of the Dogde trucks are made in Mexiko. >>>>>> ...and Canuckistan. Wouldn't have one. Why are you changing the subject? >>>>> To make the point. Sure, about 55% of foreign cars sold here are built here: >>>>> >>>>> http://www.foxnews.com/story/0,2933,465005,00.html >>>>> >>>>> However, one has to subtract from that several positions: >>>>> >>>>> a. Many times the engines, transmissions and submodules are coming in >>>>> via container ship, from overseas. So the labor in those is foreign labor. >>>>> >>>>> b. A lot of US brand cars are no longer made in the US, engines come >>>> >from Canada, and so on. All that needs to be subtracted. >>>> >>>> The value added tax will be the same on the imported car and the domestic car. >>>> It'll even the playing field more and making domestic production more >>>> profitable. THis argument is one *for* the "fair tax" (NOT the VAT). >>> >>> Now you changed the subject. >> >> No, in reality I was trying to bring it back to what it was, the fair tax. I'm >> not convinced about it and discussions help. >> > >I am not at all convinced about the fairness of it. I am especially >against anything that conveys the message "Squander everything, we'll >just sock it to the guys who didn't and you'd be whole again". It's not >the American way. Or at least it wasn't ... I agree, however most of the tax I think I like. The double tax part isn't the part that I like and I don't see *any* of the talking heads give it the TOD. Maybe I should call Boortz' radio show and ask him. ;-) >>> This was about that there'd be a clean >>> shift, exchanging income taxes of workers for a consumption tax, and >>> that such would cause dropping prices accordingly. My point is that it >>> is not revenue-neutral, not by a longshot, and in most cases would not >>> drop prices accordingly. To John Q.Public a so-called "fair tax" and a >>> VAT are the same thing, he simply has to pay 23% more for stuff >> >> He won't pay income tax or employment (SS) tax and neither will the >> corporations paying him and selling him his stuff. >> > >As said before, the Asian corporations that make the bulk of our goods >will keep paying all that, so prices won't come down nearly as much as >hope. You can't turn time back, let's face it, we've lost manufacturing >of most non-industry good. Whether it's shoes or TV sets. This is why >there is a trade deficit. If the Asian prices don't come down they'll get competition from the now cheaper US companies. Looks like a win to me. > >>> and will be mighty miffed if he's a retiree. >> >> *That* is the component I'm not happy about. I don't see anyone addressing >> it, either. > > >I did, many times over in this thread, but hardly anyone understands :-( We did, but I don't see any of the talking heads recognize it, on either side.
From: John Larkin on 23 May 2010 15:40
On Sun, 23 May 2010 14:23:53 -0500, "krw(a)att.bizzzzzzzzzzzz" <krw(a)att.bizzzzzzzzzzzz> wrote: >On Sat, 22 May 2010 22:32:16 -0700, John Larkin ><jjlarkin(a)highNOTlandTHIStechnologyPART.com> wrote: > >>On Sat, 22 May 2010 23:05:29 -0500, "krw(a)att.bizzzzzzzzzzzz" >><krw(a)att.bizzzzzzzzzzzz> wrote: >> >>>On Sat, 22 May 2010 19:19:25 -0700, John Larkin >>><jjlarkin(a)highNOTlandTHIStechnologyPART.com> wrote: ><snip> > >>>>Most retirees already have houses, furniture, pots and pans, so won't >>>>pay a huge amount of sales tax. Basic survival stuff could be >>>>exempted. And a lot of retirees have taxable income, which taxes will >>>>go away. >>> >>>A lot of people downsize their homes after they retire. That money (capital >>>gains) is currently not taxed but will be under the "fair" tax. >> >>I don't know about a "fair" tax. What I suggest is a sales tax, a tax >>on consumption. It could easily exempt capital gains, which isn't >>sales or consumption. > >Again you're missing the point. The point is that these folks have used their >house as savings - the *largest* part of their life's savings for most. >Currently this savings is exempted from taxes (up to 1/2M for married). Put >in a consumption tax and this savings is now taxed the same as income. ...even >the after-tax part (principal) of this savings. Savings aren't consumption. I never suggested taxing savings, and I did suggest exempting basics. If you want a yacht, you'd have to pay sales tax on it. > >>>>No change is going to please everybody. >>> >>>Penalizing those who have played the game according to the rules is not >>>"fair". It's no better than what Obummer is doing to business. >>> >>>>The nice thing about a sales tax is that you can elect to not buy >>>>stuff and not pay the tax. >>> >>>Not under the "Fair Tax". *Everything* is taxed, even homes. AIUI, only new >>>houses have the tax charged, but the cost difference between new and old has >>>to equalize. >> >>So tune it. > >That's how we got in this mess; Congress "tuning" the tax code. Start over with something simple, an it will take a while to get complex again. But imagine no tax returns, no record keeping, no inheritance taxes, no estate planning, no property tax, lots of jobs for your kids... unless they want to be lawyers or accountants. John |