bobgssc

What would the tax code look like if we sat down a truly bi-partisan group of educated people to review the tax code. By educated, I don't mean that each person would require a degree necessarily, but that they would have to be able to prove that they could write and understand a clearly written sentence. We could pay these people based on a percentage of how much money they cut from the code. I believe such a group could sit down and cut huge amounts from the code; at the same time, we would have to have another bi-partisan group review our government and make suggestions for how to reduce its size to a sustainable level. Again, have an even number from each size and any "tie" would remain unchanged and the group would be payed zero for that area.
It could actually work, but the government would never allow it to happen (hey, you can't cut my job, I need it!).

Augustus Greatorex Loc: NE

I don't think you have read much of the I.R.C., as your stipulation "that they would have to be able to prove that they could write and understand a clearly written sentence." {emphasis added is mine} One reason for so many IRS regulations is the obscured and oblique nature of many of the sentences within the Code.

skott Loc: Bama

Years ago I came up with a tax code for the U.S.
It is this: every one/family gets the first $25,000.00 tax free, and we ALL pay 20% of everything else. No exception, no exemptions for anyone anytime.
I know that's too hard for us.

Bigmac495 Loc: Indiana

I would agree on a federal flat tax per-cent on all purchases or a federal sales tax . If you are rich and but 2 million dollar boats you will pay more than a person who buys a canoe. If you are poorer and don't have the money to buy either one of these you will pay less or no federal tax.
This would get rid of the tax loop holes and eliminate the I.R.S. or most of them . I live in a sales tax state and I really don't mind that , what I don't like is the Personal Property tax I pay on my home and land that is a per cent tax for schools. I usually pay more personal property tax than state tax which seems way out of proportion . It costs more to run the schools than the whole state ? And I don't use the schools at all.

MarvinSussman

Q1: For taxpayers, is our “national debt” really a burden that must be repaid?
A1: No. For taxpayers, it is not a real debt. It’s a “Debt In Name Only”, a “DINO”-*

THE DINO IS NOT NOW AND NEVER WILL BE A BURDEN FOR TAXPAYERS. It is rather the buyers of newly-issued bonds who, in a virtual rollover, pay for redemption of mature bonds. In every auction, more bonds are demanded than are available. Auction winners get the safest, most liquid US dollar instruments; the losers are stuck with bank risk. If it were ever necessary, the Fed, with cost-free keystrokes, could increase the demand for bonds by buying a large slice of the DINO in the open market.

THE DINO WILL NEVER BE REPAID AND SHOULD NEVER BE REPAID. Only a budget surplus can reduce the DINO. Since Truman, every President has left office with an increased DINO and no annual budget surplus is now in sight. To supply enough risk-free securities used for trade collateral, insurance, pensions, bank reserves, etc., the DINO MUST GROW with the economy! Our world needs the DINO!

Every federal dollar spent and not retrieved by the IRS is saved by the private sector. Yes, Deficits = Savings! The Treasury has a “National debt” and the private sector has a “National asset”. The bad “Debt Clock” is also the good “Asset Clock”. Since, with our trade deficit, we export money, deficit spending is our economy’s SOLE source of savings! In fact, if large budget deficits don’t replace our vanishing cash, deflation will freeze our economy solid. Who would spend a dollar today if it would buy more tomorrow?

Our economy is suffering from acute anemia. Our (DINO + total bank deposits) / GDP ratio is less than half of China’s figure. Our M2 (money supply) / GDP ratio is half of Switzerland’s ratio and one fourth of Hong Kong’s ratio. To become and stay prosperous, we need to DOUBLE the DINO / GDP ratio to return it to the World War II level that was followed by 35 years of prosperity without harmful inflation.

Ine******y worsens the anemia. Most of the paltry money supply circulates among the Rich who bribe Congress for estate laws to stay rich to bribe Congress for laws that enrich the Rich to bribe Congress.
Wealth is power and inherited wealth is inherited power: aristocracy, always the enemy of meritocracy!

Q2: Won’t the annual debt interest expense explode the budget?
A2: Bond-holders’ taxes return over 30% of their interest income. New bond issues finance the rest. As no physical resources are consumed and the money supply does not change, there is NO INFLATIONARY EFFECT. About 70% of the interest is added to the DINO, which needs it. For those reasons, CBO budget economists deal only with the “primary” budget, which excludes the annual debt interest expense.

Q3: Could savers make a “run” on US Treasury bonds?
A3: Yes, when savers can get risk-free returns from the Wall Street casino or from GM bonds, Illinois bonds, or Detroit bonds. Safety is not everything. Safety is the ONLY thing! That’s why the whole world relies on US bonds.

Q4. Could savers stop buying US Treasury bonds?
A4. Yes, indeed! SAVERS WILL ALWAYS WANT THE SAFEST BONDS for trade collateral, insurance, pensions, bank reserves, etc. Now, almost two thirds of the world’s reserve currencies are in US dollars and almost half of all US Treasury bonds are held by foreigners. But if China’s infrastructure and productivity become better than ours, its bonds could become safer than ours and we could then lose our bond-buyers. And that could happen if US v**ers let their DINO concerns stop the renewal of falling bridges, failing schools, creaking railroads, leaking sewers, etc. Money can be printed, but infrastructure has to be built with real resources and time, which have no substitutes.

Q5: Won’t we need higher income tax rates to pay for infrastructure?
A5: Congress NEVER asks the Treasury if can pass a spending bill. In effect, Congress writes a check that Treasury NEVER bounces. To finance a deficit, the Treasury auctions new bonds created out of thin air with keystrokes.

The only rational reason to restrict deficit spending is the onset of harmful inflation. Until then, Congress can
finance both the DINO’s annual interest payment and our much-needed infrastructure. Every day, you fill your sink with water AND you prevent it from overflowing. Why can’t Congress fill our economy with money by building infrastructure AND prevent harmful inflation? China builds 24/7 without harmful inflation. Why can’t we do that?

While a bank holding too many bad loans can certainly hold too many maturing CDs, our non-lending Treasury cannot hold too many maturing bonds unless its deficit spending causes harmful inflation. And that happens ONLY in a war or emergency requiring rationing. It NEVER happens during a recession. During prosperity, banks are ALWAYS the main cause of inflation, creating over $6 of credit for every $1 of deficit spending. To curb inflation, regulate the banks before stopping work on infrastructure projects!

Q6: How much should Congress tax and spend?
A6: Ideally, Congress should tax just enough to prevent harmful inflation and should spend almost enough to cause full employment (and therefore harmful inflation). Result: prosperity with low inflation.

Instead, bribed by Wall Street, Congress taxes as little as possible, enriching the rich, and spends as little as possible, impoverishing the rest of us by restricting deficits / savings. Just as quacks k**led George Washington by bleeding his “bad blood”, Congress is destroying our younger generations by reducing (possibly to zero!) our annual budget deficits / private sector savings increase / consumer demand. And, by bribing Congress to pass austerity budgets, the Wall Street charlatans are deliberately nursing a huge army of unemployed labor to suppress the wages and working conditions of the shrinking middle class.

Q7: How should one v**e?
A7: V**e only for someone who NEVER EVER worries about the DINO and who ALWAYS worries about people looking for work and drawing benefits instead of building infrastructure for their grandchildren.

Q8: “I have to balance my budget. Why doesn’t Congress balance its budget?”
A8: If you could legally print money in your attic, why would you balance your budget? Congress only needs to balance full employment against harmful inflation. Why is something so simple so hard to see?

The “debt crisis” is simply a h**x crafted by Wall Street to gain a fortune in commissions through privatization of Social Security and other government programs. Don’t be a sucker for the s**m!
.
To stay ahead of China, please help me convince v**ers that deficit spending on infrastructure is limited ONLY by harmful inflation. Please copy and distribute this message whereever possible.

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
*The Q & A dialogue above is based on works by: (books cost about $10)

Frank N. Newman, former Deputy Secretary of the US Treasury, recipient of the Treasury’s annual “Alexander Hamilton” award, author of “Freedom from National Debt” (Two Harbors Press);

Francis X. Cavanaugh, US Treasury economist for over 30 years, author of: “The T***h about the National Debt”: Five Myths and One Reality” (Harvard Business School Press);

Warren Mosler, economist, author of “Seven Deadly Frauds of Economic Policy” (Oxford U. Press);

Dr. Stephanie Kelton, Chair of the UMKC Economics Department, at NewEconomicPerspectives.org.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
© 2014 Marvin Sussman All Rights Reserved. Permission granted only to copy entirely.

bobgssc

I actually thought about stating they might need an interpreter of the code, but deleted it and many other thoughts in favor of brevity. And yes, I have read SOME of the tax code and certain paragraphs took me several re-reads and a good amount of time to understand.

Bigmac495 Loc: Indiana

This is great Marvin , but this is all based on the mighty dollar! What happens to all this when the dollar is over printed to the extent that no one will accept them because they are just paper slips? The real reason the dollar was king of accepted currency world wide was that it was backed by gold, which was too restrictive on politicians! Other countries knew that could trade dollars in for gold if they wanted too. When the whole world wakes up to the fact that dollars are no longer backed with gold look out!

skott Loc: Bama

National Sales tax is not a good form of taxation.

bobgssc

Quote clipped to save space only.

I believe the entire concept of running a deficit is simply bad business and a bad role model for the citizenry... if the government doesn't have to be fiscally responsible, why should its citizens? As far as the rest of the post, it was interesting but not exactly related to the thread, unless I simply missed how the bonds issue ties in to tax reform (When I used the tax reform in the title, I meant the literal definition, not the phrase).
Of course, the discussion could take many "faces", or it could be used to spawn different threads such as "how can we make welfare work by putting those recipients who could work to work while taking disabled persons off the roles of welfare" or should we take politics (and tax code) out of the hands of special interests, on and on.
I completely disagree with you on deficit spending for infastructure... as simple as your opinion is to see, it would be just as simple to spend money we have on infastructure by cutting into our bloated budget. I stated previously, we would also have to review our spending habits.

bobgssc

I waiver on this. My problem with property tax is that property is usually acquired during a person's career or earning years and is usually considered to be part of that person's retirement fund per se. When that person retires, the tax burden continues to grow and can place an unfair burden on the person who simply worked hard to earn a nice piece of property but can no longer keep up with the burden of keeping that property from the state. On the other hand, one could say that people should consider this when purchasing property and plan on the tax burden as part of their planned expenses for the future. I personally believe that land tax like sales tax should be at the time of sale, and not an annual expense.

PoppaGringo Loc: Muslim City, Mexifornia, B.R.

Why does Sussman write so much to say so little?

MrEd Loc: Georgia

I have a very simple tax code that is understood by everyone with no exceptions.

1st. Get rid of the IRS. We don't need them and their actions are unconstitutional.

2nd. Forget about personal income taxes and all those other taxes they screw us with.

3rd. Make the FED accountable to the people and you do that by starting with a complete audit.

4th. Make the government not only read and understand our Constitution, but govern themselves by it. That means they spend money ONLY according to what the Constitution allows them to spend money on.

5th. Inform the American people EXACTLY how the fed operates and see how long they stay out of jail. The FED is a S**M and is k*****g this country and our economy. It is however making some bankers VERY rich........

She Wolf Loc: Currently Georgia

Thank you for the post. In my many many years on this planet, I have come to the conclusion, most people are not interested in the t***h. They are interested in the spin their party puts on the t***h.

I hear Republicans and Democrats go at each other. I say both parties are corrupt. It does really matter which you v**e for, you will be protecting the rich.

MarvinSussman

Get a pair of reading glasses, about $20 at the drug store, and then read A4 again and again, carefully. It really answers your fears.

MarvinSussman

Get a pair of reading glasses at the drugstore, about $20. Then read A8 again and again, carefully. It answers your question.