Clearly, we must reverse the perversities of the tax code and make sure virtually everyone has some financial responsibility. Our future is depending on it.

Guess Who Didn't Pay Taxes On Tax Day
By Elizabeth Factor and Mallory Factor April 16, 2010 FOXNews.com

Progressive Democrats are using “tax reform” to create a group of Americans who pay no federal income tax at all.

Did you file your federal income taxes on or before April 15? Almost 50% of American households won’t be paying any federal income tax this year, and the reasons why have profound implications for our democracy as well as our economy now.

A series of tax reforms, generous exemptions and tax credits, including last year’s economic stimulus bill, have dropped millions of Americans from the federal tax rolls. Huge numbers of Americans are simply no longer affected by the federal income tax. The Tax Policy Center projects that 47 percent of all U.S. households will pay no federal income tax for 2009. And, the bottom 40 percent of income earners actually receive a cash payment from the government at tax time. This cash payment is styled as a “refund” but it is actually a net cash transfer from the government--not a refund of taxes actually withheld on income. And for many Americans, this cash transfer from Uncle Sam actually exceeds all federal, state and local taxes that they pay in any form during the year including sales taxes and social security taxes.

Of course, we are accustomed to the idea that high income earners pay more in taxes both in absolute terms and as a percentage of their incomes. But taxing only the top half of a society is not normal progressive taxation. Instead, the recent changes to our tax system are an example of politicians using the tax code for their own political ends. In this case, the so-called progressive Democratic politicians are using “tax reform” to grow their political base by creating a group of Americans that pay no federal income tax.

The people who don’t pay federal income taxes are, as the phrase goes, “rational economic actors” just as much as anyone. Like all people, non-taxpayers respond to economic incentives. Their demand for entitlements and government programs is naturally insatiable because they don’t care at all about the cost. Non-taxpayers don’t have any “skin in the game” and are completely indifferent to the government raising income taxes. So they will always support increasing government programs as a long as they get even a small benefit from them because it does not cost them a cent. It’s also perfectly rational for non-taxpayers to support politicians who favor more spending. Non-taxpayers get something for nothing, at least until the country becomes insolvent.

The so-called progressive Democratic politicians are rational actors too. By taking more and more Americans off the federal tax rolls, they are creating a permanent base of supporters for themselves. These politicians may claim to support increased government spending because of their concern for the less-fortunate but--hey, it also happens to be in their own political self-interest. And these politicians will continue to spend on these programs until our nation goes bust because they want to keep their jobs and grow expensive programs for their political base.

And what about the people paying all the federal taxes? Well, taxpayers respond to incentives too. When faced with increasing tax rates, taxpayers will reduce their income, which is why it is impossible to raise a lot of revenue by increasing taxes above a certain point. As taxes on income rise, taxpayers spend less time on work and more on leisure.

They avoid sales of investments and assets which could trigger income until they can pair them with offsetting losses from other transactions. They spend billions of dollars on tax advice and structuring to reduce their tax burden, which makes economic sense for them but which is a waste of resources for our society. In the aggregate, a tax system that is hostile to investment and growth has a distortive effect which harms U.S. productivity and reduces the standard of living of our whole nation.

Under the Obama administration, many Americans accustomed to paying their share of federal taxes are being taken off the tax rolls. Recent tax law changes mean that for the first time, in 2009, a family of four making $50,000 can pay no federal income tax at all. This family may not change its behavior and outlook immediately from its taxpaying days. But the family’s economic incentives are now to keep America taxing and spending. And a family at this income level has surely suffered in this recession, but should they really pay no federal income tax at all?

Ronald Reagan once said that a taxpayer is “someone who works for the Federal government but doesn’t have to take the civil service examination.” Every American should have to work for the federal government at least a little bit. We need to move back to a broad-based tax system so that more Americans understand that there is no such thing as free money—government spending actually has a huge cost for our nation.

The so-called "progressive" politicians have turned John Kennedy’s “Ask not what your country can do for you – ask what you can do for your country” on its head. And telling so many Americans that they don’t need to make sacrifices for our government, as we are now saying, is dangerous new territory for our nation and for the health of our democracy and economy.

Elizabeth Factor is an international tax lawyer and former investment banker.Mallory Factor is the co-chairman and co-founder of the Monday Meeting, an influential meeting of economic conservatives, journalists and corporate leaders in New York City. Mr. Factor is a well-known merchant banker and speaks and writes frequently on economic and fiscal topics for news stations, leading newspapers and other print and online publications. Mr. Factor writes frequently for the Fox Forum. Mr. Factor can be reached at mallory.factor@malloryfactor.com

NO MORE!

VAT is an oppressive and to some extent hidden tax which makes it easier for the government to levy it and then relentlessly raise it. And when the government has more of our money they find that it’s never enough – so they spend even more than they collect. Ad infinitum.

This VAT has helped create the stagnation and miasma of indolence in Europe and we must make sure that it is never implemented here.

VAT Will Spell Anything But Relief
Investors Business Daily  04/08/2010

Taxes: Asked why he robbed banks, thief Willie Sutton famously replied: "That's where the money is." The same logic is now being used by the White House as it floats the idea of a broad new tax on all consumption.

White House adviser and former Fed chief Paul Volcker, one of the most respected men on Wall Street, broached the delicate topic of taxes Tuesday.

In his remarks, he said a value-added tax "was not as toxic an idea" as it had been in the past, and suggested it might be a way for the U.S. to escape its growing budget crisis.

"If at the end of the day we need to raise taxes, we should raise taxes," he said.

No doubt this is a trial balloon. Based on the $10 trillion in budget deficits expected over the next 10 years, this is one crisis the White House won't want to waste, as Rahm Emanuel would say.

Already, it's waged open war on the rich — vowing to take as much from those having $200,000 in income as it can. The 10-year budget plan submitted by President Obama in fact hits that group with $636 billion in new taxes.

But that's not even close to being enough to pay for the Democrats' reckless expansion of government.

As we've noted here before, Obama's new budget spends $45 trillion from 2011 to 2020. That's a 70% rise in spending from the previous decade. The only problem is, we're expected to collect only $35 trillion in taxes — and even that might be an overestimate, based on recent dismal economic growth.

So just going after the rich can't close that gap. The wealthy literally don't have the money. And even if we raised income taxes on everyone, which is highly unlikely, we would have to double current income tax rates to balance the budget, according to a recent Tax Foundation study.

So with deficits averaging $1 trillion a year through 2020 and spending soaring, where will the money come from?

Answer: A VAT. Only a VAT will give the government enough money to let it continue its out-of-control spending — which now seems to be the Democrats' main political goal.

Right now, the poor and the middle class pay virtually no taxes at all. In 2008, 49% of all households paid no taxes, new data show.

Those who had no tax liability at all receive about $70 billion in benefits and cash a year. In effect, for many, tax day has become an opportunity to collect a giant welfare check.

Yet, despite Obama's pledge that those with incomes below $200,000 wouldn't see their taxes raised "one dime," the fact is, they're the ultimate target of a VAT.

Yes, Obama is giving them lots of goodies. But he and the Democrats in charge of Congress know they'll have to tax the poor and the middle class to create the cradle-to-grave welfare state they so desperately want. It's the dream of all so-called progressives.

And it's already happening. In the health care takeover just signed into law, there are 13 new taxes — many of which will hit the poor and the middle class.

Still, that's penny-ante stuff. A VAT, as used in 150 countries around the world, would be a real money gusher — a Trojan horse for tax hikes on all Americans, especially the poor and middle class.

A VAT, remember, is really a tax on consumption. And since the poor and middle class spend a much greater ratio of their incomes on consumption than the wealthy, they'll bear the brunt.

A recent report from the liberal Urban-Brookings Tax Policy Center said: "A major concern with a VAT is that it could be regressive, raising tax burdens proportionately more on lower income than on higher income taxpayers."

Even so, many Democrats point favorably to the European Union's welfare states, where VATs as high as 20% have long been a staple of public finance. The U.S., these critics suggest, would do well to imitate our EU friends.

Or not.

As the Cato Institute's Daniel Mitchell recently noted, "real-world evidence shows that VATs are strongly linked with both higher overall tax burdens and more government spending."

Indeed, in 1965, just before the EU adopted the VAT broadly, the average EU tax burden was about 28%, vs. 25% in the U.S.
By 2006, the EU tax burden was 40% — compared with 28% in the U.S.

The VAT tax grew and grew and grew. But Europe's economies didn't. Now, thanks to too much government and excessive taxation, the EU is almost hopelessly behind the U.S. in terms of both innovation and productivity. Is that the future we want?

No. The VAT's a terrible idea. It would bring higher taxes, slower growth, fewer jobs and lower standards of living. But it would do one thing well: give bureaucrats a lot more of your money to spend.

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=529800

Jon Voight was a guest on the Mike Huckabee show on April 10th, 2010. On the show he read an open letter to America and to Barack Obama where he discussed the future of America and the need for us all to get involved in our individual states Tea-Party movement in order to save our nation.

The following is the text of the letter:

“In one year, the American people are witnessing the greatest lie that is cleverly orchestrated by President Obama and his whole administration. The lie is a potent aggression that feeds the needs of people who either have not educated themselves enough to understand the assault upon us all or the very poor and needy who live to be taken care of.

President Obama feeds these people poison, giving them the idea that they are entitled to take from the wealthier who have lived and worked in a democracy that understands that capitalism is the only truth that keeps a nation healthy and fed. Now the lie goes very deep and President Obama has been cleverly trained in the Alinsky method and it would be very important that every American knows what that method is.

It is a socialistic, Marxist teaching and with it, little by little, he rapes this nation, taking down our defenses, making new language for the Islamic extremists. The world looked up to us as a symbol of hope and prosperity now wonders what will become of the entire world if America is losing its power.

The American people who understand exactly what is taking place have come together in the thousands, vowing to try to stay together as a unit of love and freedom for all men and women, from all walks of life, shivering to think that this once great nation will be a third world country.

This will be the first president to ever weaken the United States of America. President Obama uses his aggression and arrogance for his own agenda, against the will of the American people when he should be using his will and aggression against our enemies.

Every loving American for peace and truth and the security of our nation must come out and join the Tea Parties in their states. The opposition will continue their tactics; they will lie and plant their own bullies amongst us. Everyone must pay close attention to who stands next to them. We can weed out the liars and agitators.

Let us all stay in Gods light. Let no man put asunder. We can and we will prevail. God bless us all!”

Jon Voight, April 10th, 2010

http://www.thefoxnation.com/jon-voight/2010/04/11/watch-jon-voight-reads-letter-american-people

There are no cost savings nor will there be a reduction in our national debt. We don’t think that adding in excess of 170 new federal agencies enumerated within this bill will accomplish this trick. Nor will the planned hiring of 16,500 new IRS agents (we don’t think that they have your interest at heart) to monitor compliance save us money. These actions tell you all you need to know about Obama’s and the Congressional Democrats’ true agenda under the guise of healthcare reform.

We all must vigorously thwart implementation of Obamacare by also providing verbal and financial support to our Senators, Representatives, Tea Party Groups, organizations and States who will be fighting this despicable legislation.

Enacting A Lie
Investors Business Daily 03/22/2010

Health Overhaul: Sunday's vote exposed the ugly truth that ObamaCare is not really about health care at all. It's all about who pays for it and who controls it — in effect a massive wealth-redistribution scheme.

Those who believe this will lead to some medical nirvana will likely be disappointed. Fact is, this poorly designed monstrosity will lead to lower-quality care, higher costs, fewer practicing physicians, higher taxes and fewer jobs.
We've done more than 150 editorials in the past year or so documenting these problems. Democrats surely understand them.
Yet, despite a recent CNN poll showing that 59% of Americans oppose ObamaCare, Congress approved it anyway.

Why? Because it's not really about health care. It's the largest wealth grab in American history, masquerading as health care "reform," another step in the socialization of Americans' income in the name of "fairness" and "spread(ing) the wealth around," as Obama himself has put it.

That's why we call the program a lie.

The idea behind all this, simply put, is control. This is a vast expansion of government that will require as much as $3 trillion in added spending over a decade. All claims of deficit neutrality are a joke.

This is socialization through the tax code. That $3 trillion has to be paid for. As we showed last week, the health care bill levies $569.2 billion in new taxes over the next 10 years alone.

At the same time, as noted by Douglas Holtz-Eakin, former head of the Congressional Budget Office, it will increase U.S. budget deficits by $562 billion.

Who'll pay all these taxes? Those deemed "rich" by Democrats, and businesses. Specifically, the bulk of the money comes from a special 3.8% Medicare tax on 5 million people earning more than $200,000 a year. That tax is imposed on capital gains, dividends, rents, royalties and interest — that is, investment income.

Obama already has proposed boosting these taxes in his budget. So the top tax take on dividends and cap gains will rise to 23.8% from 15%, an increase of nearly 59%, while top rates on interest and rents will soar from 15% to nearly 44%, a 193% jump.

About 50% of this higher-taxed group reports small business or partnership income. So don't be fooled: These aren't taxes on the "rich," but on small businesses and jobs.

In ObamaCare, the taxes will be ruinous. Unlike real insurance, where individuals pay to cover their risks, this program covers everyone — including 32 million uninsured — and pays for it by a "mandate" ( read: "tax" ) and by taking money from other people to subsidize those who can't pay. And this just scratches the surface of the new taxes — we literally don't have room to list them here.

Hmm. Taking money from one group, and giving it to another. That's called welfare — or, perhaps, health-fare. It's not insurance.

Once the new program is finished wrecking what remains of the private health insurance industry — as it ultimately will — we'll be stuck with the government declaring that "the market doesn't work" and forcing all of us into a single-payer government plan.

That's what those Democrats who back "Medicare for all" want — to kill what's left of the private market for health care, which has created the best medical system on earth, and use "reform" to expand an already-bankrupt Medicare system.
The math behind this is ugly. Medicare's long-term liabilities now total $89 trillion, according to the Government Accountability Office. Based on projected deficits, the just-passed health reform will take that to $136 trillion.

It will take a lot more than the "rich," as defined today, to make up such unfathomable tax shortfalls. That's when they'll come for the rest of us — poor, middle-class and rich alike — and we all will be paying vastly higher taxes for vastly inferior medical care.

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=528099