Great discussion. Keep it up.

@Matt_SF: Both? Definitely not an easy path to follow. Rock, meet hard place.

@Everyone: I typically don’t write about taxes much for a few reasons. A.) I’m not a qualified tax professional. B.) Talking about anything in government is an emotionally charged environment. I try to keep my politics personal. In fact Republican, Democrat, Independent… I’ll take them if they can balance the budget.

Maybe taxes is one area where PF bloggers could improve. As an example, the debate between Roth IRAs and regular IRAs appears frequently, but normally the government tax rate is just an afterthought. Most articles that do discuss tax rates just say “tax rates could go up in the future, but there is no way to know.”

Another thing I’ve noticed that bothers me is people say that “I saved $XXX by contributing money to my 401(K), but in reality, the money hasn’t been saved – the spending is just delayed.

I definitely agree with you that defense spending should be the first to be cut. People argue that war is good for the economy, but I do not accept this on the surface. Money spent on weapons does not produce goods and services that go back into the economy. Also, most wars are normally followed by a period where we pay for the stuff that we just blew up.

I had a conversation earlier in the week where the gist of the conversation was…

What’s worse? Setting up a portfolio to protect you against higher inflation, or protect you from higher taxes?

In the politicians terms after serving terms =)

Politicians goal is re-election is b/cuz we have such short terms. Honestly, what can you do in 2/4/6 yrs? Start a war? Start reform? Start a lot of things? When taxes are such an easy issue… ugha

“When a man spends his own money to buy something for himself, he is very careful about how much he spends and how he spends it. When a man spends his own money to buy something for someone else, he is still very careful about how much he spends, but somewhat less what he spends it on. When a man spends someone else’s money to buy something for himself, he is very careful about what he buys, but doesn’t care at all how much he spends. And when a man spends someone else’s money on someone else, he does’t care how much he spends or what he spends it on. And that’s government for you.” – Milton Friedman

So, look at our spending now and increase it by 30%.

The rebates would add another $600 billion of spending. Additionally, the rebates are paid out based on the poverty level income. Poverty level income as a way to gauge poverty is like BMI as a way to gauge obesity, it doesn’t work how it should. A childless couple would get a monthly rebate of $391 per month, but a single mother with two children would only get $329 per month. Sound fair?

Prices will rise with the additional 30% tax. I don’t understand how they claim prices would fall. Sales taxes never make the price go down. The fact that their is no more income tax makes no difference because the employer was paying the gross all along. The only way to lower prices is to cut costs… would people be taking 30% pay cuts? No? Of course not. So prices would raise.