Fair Tax Friday, A Whitepaper on the Prebate by Karen Walby Ph.D.

The Fair Tax is much maligned because the prebate is often overlooked or just plain ignored in the calculations put forward by some organizations. Understanding it is crucial to a discussion of the proposal. I have chosen to highlight this segment today. If you are new and have no idea what the fair tax is, go to this simple video. Under the FairTax, all Americans consume what they see as their necessities of life free of tax. While permitting no exemptions, the FairTax (HR25/S13) provides a monthly, universal prebate to ensure that each family unit can consume tax-free at or beyond the poverty level, with the overall effect of making the FairTax progressive in application. This is not an entitlement, but a rebate (in advance) of taxes paid – thus the term prebate. Everyone pays taxes at the cash register. Although everyone pays the same tax rate at the cash register, the chart below shows that the effect of the prebate is to increase the actual tax rate (annual taxes paid as a percentage of annual spending) as the level of spending increases, a progressive tax rate structure. For example, a person spending at the poverty level ($30,260 for a family of four) has a 0% effective tax rate because the annual prebate of $6,960 refunds all of the taxes they paid. Whereas someone spending at twice the poverty level has an effective tax rate of 11.5%, and so on. Annual spending would have to be in excess of $14 million per year to reach the statutory rate of 23%. Calculation of the prebate: The monthly prebate check is calculated by multiplying the annual consumption allowance as measured by the Department of Health and Human Services poverty guidelines times the FairTax rate and dividing by twelve. Poverty level spending represents what it Note: The Tax rate is calculated by subtracting the annual prebate of $6,690 from the FairTax and dividing that result by annual spending. FairTax Rate as a Percent of Spending: 2012 Two Adult/Two Child Household Annual Spending costs families of varying household size and composition to buy their necessities. The table below shows the monthly prebate amount for households of varying composition. 2012 FairTax Prebate Schedule1 One-adult household Two-adult household Family Size Annual Consumption Allowance1 Annual Prebate Monthly Prebate Family Size Annual Consumption Allowance1 Annual Prebate Monthly Prebate 1 person $11,170 $2,569 $214 couple $22,340 $5,138 $428 1 adult and 1 child $15,130 $3,480 $290 2 adults and 1 child $26,300 $6,049 $504 1 adult and 2 children $19,090 $4,391 $366 2 adults and 2 children $30,260 $6,960 $580 1 adult and 3 children $23,050 $5,302 $442 2 adults and 3 children $34,220 $7,871 $656 1 adult and 4 children $27,010 $6,212 $518 2 adult and 4 children $38,180 $8,781 $732 1 adult and 5 children $30,970 $7,123 $594 2 adults and 5 children $42,140 $9,692 $808 The annual consumption allowance is based on the 2012 HHS Poverty Guidelines as published in the Federal Register, Jan. 26, 2012. To eliminate the marriage penalty, the couple amount is twice the individual amount, to which $3,960 is added for each child. The annual prebate equals 23% of the annual consumption allowance. Qualification: All qualified families are entitled to receive the monthly prebate. A “qualified family” consists of all family members sharing a common residence. Family members include an individual and his or her spouse, children and grandchildren, parents and grandparents. Children/students living away from home are considered family members if they are registered as a student for at least 5 months out of the year and receive at least 50 percent of their support from the family unit. Children of divorced parents are considered to be family members of the custodial parent. Incarcerated individuals are not eligible to be a member of a qualified family. In order for a person to be counted as a member of the family for purposes of determining the size of the qualified family, a person must have a valid social security number and be a lawful resident of the United States. Unlike the Earned Income Tax Credit, the application/registration form that families who choose to receive the prebate must file is simple and straightforward. Those choosing not to register will not receive a prebate. The registration form requires only the following information: 1. the name of each family member who shares the residence; 2. the social security number of each family member; 3. the name of the family member to whom the monthly prebate check should be paid; 4. a sworn statement that all listed family members are lawful residents, that all family members sharing the common residence are listed, and that no family members are incarcerated; 5. the address of the shared residence; and 6. the signature of all family members 21 years of age and older. Administration: The Social Security Administration (SSA) will send out the monthly prebate on or before the first day of every month. Prebate payments can only be made to persons 18 years or older. If a family wishes to designate more than one person to receive the prebate, then the prebate payment will be divided evenly among those persons designated. Example: two single people sharing the same residence would be able to each get a prebate check. Registration renewal: After the initial registration, any qualified family that fails to renew its registration each year, within 30 days of the family determination date, will cease receiving the prebate 90 days following the failure to register. However, the family can file to get up to six months of missed prebate checks later (with no interest on missed payments). A possible method of assigning registration renewal dates would be on the birth date of the person filing the application. Thirty (30) or more days before the annual registration date, the sales tax authority is required to mail a proposed registration to each qualified family that simply needs to be signed and mailed back in if the family’s circumstances have not changed. Administrative Cost: In accordance with instructions from each qualified family, SSA will provide the prebate in the form of a paper check via U.S. Mail, an electronic funds transfer to a bank account, or a “smartcard” that can be used much like a bank debit card. (This method is already in use to provide other benefits from the federal government.) The National Taxpayers Union estimated that the cost of mailing monthly prebate checks via the U.S. Post Office would be approximately $260 million.1 To the extent the SSA uses electronic funds transfer/direct deposit and “smart card” technology; this amount would be reduced substantially. According to the SSA, Office of the Chief Actuary, over 92% of social security benefit payments were paid with direct deposit in 2011. Fraud Prevention: When the state sales tax authorities process the prebate applications they will validate all names and social security numbers against the SSA database. States already do this in relation to the administration of other state/federal cooperative programs such as unemployment compensation benefits and child support enforcement. They will also check for duplicate social security numbers being claimed by different households to prevent more than one household listing the same person as a household member. Any duplicate social security numbers will have to be resolved before the prebate payment is made. It is unlawful to willingly and knowingly file a false prebate claim. HR25 provides for both civil and criminal penalties. The civil penalty is equal to the greater of $500 or 50 percent of the claimed annual prebate amount not actually due plus repayment of any falsely due prebate amounts. A criminal penalty of imprisonment for up to one year may also be imposed. Fiscal Impact: The estimated number of households for 2010 is 122 million. Assuming 100 percent participation of all eligible households, the cost of the prebate would be $528 billion. For comparative purposes, this amount is less than one-half of the amount of tax expenditures (standard deductions, personal exemptions, Earned Income Tax Credit, mortgage interest and charitable contribution deductions, and various other tax preferences) doled out under the current federal income tax system that are repealed when the FairTax is enacted. For 2010, the total of all of these tax breaks exceeded $1.3 trillion (according to the Tax Policy Center as published in Tax Notes, March 28, 2011). 1 Update of National Taxpayers Union estimate to account for first class postage increase and an increase in the number of households. What is the FairTax Plan? The FairTax Plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an integrated approach including a progressive national retail sales tax, a prebate to ensure no American pays federal taxes on spending up to the poverty level, dollar-for-dollar federal revenue replacement, and, through companion legislation, the repeal of the 16th Amendment. This nonpartisan legislation (HR25/S13) abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax – administered primarily by existing state sales tax authorities. The IRS is disbanded and defunded. The FairTax taxes us only on what we choose to spend on new goods or services, not on what we earn. The FairTax is a fair, efficient, transparent, and intelligent solution to the frustration and inequity of our current tax system. What is Americans For Fair Taxation (FairTax.org)? FairTax.org is a nonprofit, nonpartisan, grassroots organization solely dedicated to replacing the current tax system. The organization has hundreds of thousands of members and volunteers nationwide. Its plan supports sound economic research, education of citizens and community leaders, and grassroots mobilization efforts. For more information visit the Web page: www.FairTax.org or call 1-800-FAIRTAX. Authored by Karen Walby, Ph.D., Chief Economist, Americans For Fair Taxation, 2007. Revised February 28, 2012. (AFFT Documents\Papers on a specific subject\explanation of prebate)

38 thoughts on “Fair Tax Friday, A Whitepaper on the Prebate by Karen Walby Ph.D.”

  1. The Fair Tax will always be regressive because it exempts the things the rich buy most – financial securities. Consumption of financial securities is currently captured by income taxes on capital gains and dividends, so the Fair Tax is yet another scheme to virtually eliminate taxes on the rich.

    Now, if the Fair Tax were coupled with a financial transaction tax, that might be better. But it would still suck.

  2. Financial securities (investments) are neither beast nor fowl. The consumer does not take literal possession. Nor is the investment used in any real manner (passive investments). The security is at best collateral put up by the business in order to acquire capital needed to financial operations and growth. The collateral earns interest (ROI) depending on how long the security is held before being traded to another investor.

    The wealth do consume more than the non-wealthy simply because they have more resources to do so. I think my objection comsumption taxes is that revenues are a funtion of consumption and the consumer can choose not to consume. The wealthy particularly are able to restrict their cosumption or even consume more of their wealth off shore.

    Regardless, I am not convinced that sales taxation as the only means of renenue is workable. Additionally, I’m not aware of any proposal that deals with other taxes, such as property taxes and utility taxes (communications, et al). I would still prefer to classify ordinary income as any income that is made whether the income was the result of investing one’s labor, intellectual property, dollars, stamp collections, etc. Income is income. People earn income using various methods. I don’t understand why it matters what they invested to earn that income. Investing labor or dollars should be treated the same.

  3. ” Investing labor or dollars should be treated the same.”

    I disagree, and I guess that’s what makes me a progressive. Today’s incredible wealth inequality is occurring in large part because the upper-income tax cuts since 2001 have allowed the already-wealthy to compound their tax cuts for twelve years now. And there is no doubt this is happening at the expense of the middle class, which is worse off for it.

    I don’t think people should get wealthier simply because they are already wealthy. That is the old-Europe thinking we defeated in the Revolution. It violates my concept of our meritocracy and democratic principles. A strongly progressive tax rate is an attempt to level the playing field and retain fairness in the economy.

    Taxation is not only the power to raise revenue, it is the power to encourage beneficial behaviors by the way we tax. As Republicans like to say, if you want less of something, tax it. That is why I support home interest deductions, charitable deductions, and higher taxes on polluters or offshorers, for example.

    Taxation of investment income can encourage hiring and investment by providing discounts for long-term capital gains and higher rates for short-term profits.

  4. The consumption tax has only been around since the Egyptians and beside the head tax, may be the oldest form of taxation, Dave.

    I agree that financial instruments are not consumption. Alpha just wants to punish the rich and redistribute the wealth as opposed to finding a tax system that grows the economy and allows the tax burden to be equitable while shielding the poor from undue hardship.

  5. I’m not sure what you disagree with. Is it what gets compared to what?

    Do you disagree that investment income should be taxed at the same rate as orgdinary income or that ordinary income should be taxed at the same rate as investment income? From your comment it seems like you were arguing both sides of the coin.

    I agree that tax policy can be used to incentivize growth. However, imagine if there were a higher tax on capital gains. Would that mean that the investor would not invest? What would they do with it? Just hold? Wouldn’t they invest anyway since that is the only way to make the money do work? Separate tax treatment for long term gains does have a beneficial effect in that it promotes stability in the market. Still, remember, except for our own 401Ks, who can afford to not touch their investment to ensure that they do have long term capital gains? Only the wealthy. Everyone else may have to tap those funds to buy a home, recover from hurricane Sandy, pay college tuition. I think there is a balance that could be struck but right now the disparity between capital gains and ordinary income in tax policy is out of whack.

  6. ” imagine if there were a higher tax on capital gains. Would that mean that the investor would not invest? What would they do with it? ”

    We don’t have to imagine. In the 1990s we had a 39% rate on dividends and top marginal income, and a 25% rate on long-term capital gains. They hired and invested like crazy, and we enjoyed a broad-based economic boom. In fact the boom was so widely shared we were able to provide jobs instead of welfare. That is a favorable tax structure.

  7. As with all conservative schemes to get rid of income tax, this tax is regressive. The rich will pay less, meaning the rest of us would have to pay more.

    That, and the fact that it will never pass, are the only things anyone needs to know about the “Fair” Tax.

  8. That is the old-Europe thinking we defeated in the Revolution.

    So let’s be like the ‘New Europe,’ and go bankrupt instead.

  9. I’ve got a better idea. Raise the top marginal rate to 100% and raise capital gains to 100% for three years until the entire national debt is zero. Then use those two years to figure out our federal government’s actual expenses. Then, after the total debt is zero, we again institute tax cuts allowing for just enough revenue to fund our actual needs…

    Makes more sense than the tax scheme mentioned above.

  10. Dave writes in #5: “However, imagine if there were a higher tax on capital gains. Would that mean that the investor would not invest?”

    YES, that is exactly what it would mean. Or, rather, fewer people would invest and they would invest less.

    Dave writes in #5: “What would they do with it?”

    Spend it on current consumption rather than investing for the future. So if you are not going to make much of a profit, why not travel to Europe or take a river cruise on the Volga instead of investing?

    Dave writes in #5: “Just hold?”

    YES. There are rich people who have gold coins sitting in Swiss banks rather than taking a chance.

    Dave writes in #5: “Wouldn’t they invest anyway since that is the only way to make the money do work?

    NO.

    This is another part of liberal dysfunction on economics.

    INVESTING IS RISKY, GENIUS!

    Every time a person invests their money, THEY COULD LOSE ALL OF IT or some of it or most of it.

    So every investment decision is a trade-off between risk and return: IS THE RETURN WORTH THE RISK?

    If you lower the return, the balance between risk and return tips in favor of KEEPING YOUR MONEY instead of putting it at risk.

    So a rich person has $100,000.

    Should I invest it? I might never see it again.

    Should I take the little lady on a world cruise and 6 month vacation through Europe, Asia, and Australia?

    If I spend the $100,000 I have a 100% certainty of enjoying the money.

    If I invest the money, I MIGHT LOSE IT and never get to enjoy the money.

    So why should I give up the 100% certain enjoyment of my money — and immediately — in return for (a) deferred gratification and (b) the risk of completely losing the money and never enjoying it at all?

    This is where liberals are completely dysfunctional with regard to the economy and fiscal issues.

    Liberals assume that investments always make money, businesses always make money, businesses can endure an infinite amount of taxes and regulation without blinking… basically that there is an infinite source to indulge the liberal’s desires.

  11. More talk of taxation instead of cutting. 87 billion in new revenue if we implement higher taxes on the wealthy. That does not pay 10 full weeks of interest on the national debt. How do you assure the wealthy, who have the means, won’t evade them? Where will you cut spending and by how much? Both main sides favor spending, they only differ on whether to write the check to militarism or socialism.

  12. “Liberals assume that investments always make money”

    If in July of 1999 you put 100,000 dollars into a passively managed index fund seeking to match the S&P 500 benchmark you would have endured 3 bubbles bursting, the most volatile market conditions possibly in American history, and the worst economic collapse since the great depression. You would have made money.

    And if that was a passively managed bond fund you’d have made about 6 percent a year on your investments over the past decade.

    If you lose everything in an investment as a rich person you are a moron. Moseley, you not knowing anything about investing does not give you the right to lie to people about the perils of it. If people choose to take idiotic risks they do so at their own peril.

  13. “How do you assure the wealthy, who have the means, won’t evade them? ”

    I certainly hope the wealthy avoid the new taxes by choosing to hire and to re-invest in their businesses. It’s not about collecting the money – it’s about changing the rules of the game to make it more fair for wage-earners.

    You do realize employee compensation and investments into plant and equipment are tax-deductible. Every business owner can give themselves a tax cut whenever they want.

  14. When it comes to economic predictions liberals can’t forecast the past. It is obvious liberals support lobbyists, poverty and hopelessness as there failed policies always lead to failure.

    A tax system should be geared to do three things; encourage savings, growth and investment not social engineering or fairness as neither will happen.

    Try having the government accomplish a few basic things with some sense of value and excellence before you foist this incompetent behemoth on more parts of our lives.
    Mike Protack

  15. @10, Jon

    Your “answers” to what the wealthy would do regarding investments demonstrates that you have no real world knowledge.

    They will always invest their money. They always seek vehicles in which the ROI will be the greatest. Sometimes it is precious metals, utlities, bonds, mortgages, whatever. They never hide their money under a mattress. Once again, you display your silliness. You’ve gone so far down that road, I seriously doubt that you can ever find your way back again. Honestly, on this site at least you are nothing more than a court jester. A real live fool.

  16. Dave, you don’t know what you are talking about.

    I have to be vague, but I know clients right now with several million dollars of gold coins sitting in a safe deposit box in Europe.

    My undergraduate degree is in Finance.

    If the potential profit from an investment does not justify the risk, the only smart thing to do is NOT invest…. sit on the sidelines.

    When you talk about Return on Investment (ROI) that assumes the best case scenario.

    One of my clients Iam working to find investments for is a company whose owner lost $60 million in the 2008 Wall Street crash, went bankrupt, and dragged one of his companies down with him.

    In investments, you can lose it all.

    In fact, I know 3 people who were invested in options on margin in 2008 and lost several million MORE than they had invested, and OWE money back to the broker.

    So what you and other liberals fail to understand is that you can LOSE MONEY investing money.

    The profits, expected ROI, have to be sufficiently large to make it worth the risk.

    Liberals increase the risk by increasing regulation, thus shifting the balance AGAINST investments.

    Liberals increase the risk by uncertainty from constantly changing regulation, utopian fantasies, and trying to remake society, thus shfiting the balance AGAINST investments.

    Liberals lower the profits from investment by increasing taxes and regulation, thus shifting the balance AGAINST investments.

    Furthermore, liberals shift the choice of investments away from job-creating businesses to inert investments.

    Businesses that employ people endure the greatest punishment by liberal policies, compared with say investing in art, coins, precious metals, stamp collections, etc.

  17. The bottom line is that the core of liberalism is the belief in getting something for nothing.

    Liberals want to achieve not be hard work or creating anything of value, but through trickery, games, or hairbrain schemes.

    So it is necessary for liberals to engage in the fantasy that they can suck an infinite amount of abuse and money out of businesses and the rich, and it would make any difference

    That is a juvenile fantasy.

  18. Lets try that again:

    The bottom line is that the core of liberalism is the belief in getting something for nothing.

    Liberals want to achieve not by hard work or creating anything of value, but through trickery, games, or hairbrain schemes.

    So it is necessary for liberals to engage in the fantasy that they can suck an infinite amount of abuse and money out of businesses and the rich, and it won’t make any difference

    That is a juvenile fantasy.

  19. “I have to be vague, but I know clients right now with several million dollars of gold coins sitting in a safe deposit box in Europe.”

    I suppose I could point out that if one were to turn on Fox, one would be inundated with advertisements for investing in gold and gold coins for the impending apocalypse and that gold coins sitting in a safe deposit box anywhere remains an investment, by any definition of the word.

    But really, I shouldn’t have to do that. Should I?

  20. “the core of liberalism is the belief in getting something for nothing.”

    Really? Could you find me some founding documents of “liberalism” that reflect this claim?

    “liberals … engage in the fantasy that they can suck an infinite amount of abuse and money out of businesses and the rich, and it won’t make any difference.”

    This is either hyperbole or bullcrap. Again, please show me where any liberal involved in these issues has said any such thing. Make sure you get the part where they say “infinite.”

    You can’t argue against people’s real positions when they’re reasonable, Jon, so you just make up some unreasonable version of the basic idea and take your shots at that. You’re like a father who sets the basketball hoop at 8 feet for his little kids and then acts like a hotshot because he can dunk on it.

  21. A primer on Mike Protack’s political instincts, as revealed in a single paragraph:

    “When it comes to economic predictions liberals can’t forecast the past.”

    Please, you’re killing me! You tried this one out on open-mike night at the Chuckle Hut, didn’t you?

    Could you provide examples? Conditions since the crash have unfolded just as several liberal economists predicted, while we’re still waiting for the catastrophe some conservatives seem to be hoping for. Which party wears ideological blinders again?

    “It is obvious liberals support lobbyists…”

    Insulting and demonizing liberals in a state full of Democrats. Brilliant strategy. Also, it was Republicans in Congress who put together the K Street Project to embed former GOP staffers in lobby shops while shutting out former Democratic staffers. Which party supports lobbyists again?

    “…poverty…”

    Hmmm. A recent report from the National Employment Law Project found that:

    — in 2011 unemployment insurance supported 26 million workers and their families, lifting 2.3 million people out of poverty, including more than 600,000 children. —

    Many conservatives wanted to cut off insurance to some of those families so they wouldn’t become “dependent” on the aid. Which party supports poverty again?

    “…and hopelessness…”

    Please provide a link to the study on hopelessness to which you refer. Or is this just one of those unsupported things Republicans like to say because “it’s obvious”?

    “…as there failed policies always lead to failure.”

    This is more empty rhetorical demonizing — brilliant approach when you’re outnumbered 2-1. I can’t imagine why it would fail to win you Democratic converts.

    But it gets extra credit for being that particularly obvious trap for the empty-headed, a tautology — the condition described couldn’t be otherwise, as the definition of a failed policy is one that leads to failure.

    If parsed, therefore, it doesn’t even land as an insult, as it does not rule out other Democratic policies that, not having failed, are not failures.

    And he nails the landing by using “there” instead of the correct “their.”

    There you have it, boys and girls. This is the towering political intellect who imagines himself the Delaware GOP’s prophet in the wilderness.

  22. Geezer wrote in #21: “Conditions since the crash have unfolded just as several liberal economists predicted

    You mean unemployment is at 5% — as Obama promised, backed up by all the liberal economists who told us we shoudl waste trillions of dollars on Obama’s plans????

    Wow. That’s news Someone should report on that.

  23. We all lived through it, Alpha.

    Nice try. “Don’t believe your lying eyes, believe what I ell you.”

    The Obama transition team put out an analysis — whose purpose was to support the effort to sell the country on wasting a trillion dollars on Obama’s stimulus package.

    The analysis promises that unemployment will drop by over 3.6% from 8.8% — equating a 1% drop in the unemployment rate with an increase of 1 million jobss.

    http://www.ampo.org/assets/library/184_obama.pdf

    Yes, you actually have to read it and not be lazy.

    It identifies a 1% drop in the unemployment rate as equaling 1 million jobs.

    It then promises that if we waste money on Obama’s plan it will produce 3.675 million jobs.

  24. “You mean unemployment is at 5% — as Obama promised, backed up by all the liberal economists who told us we shoudl waste trillions of dollars on Obama’s plans????”

    Really, Jon, find the quote. He never said it. And he’s no economist. And neither are you.

  25. http://online.wsj.com/article/SB10001424052702303552104577440500952025754.html

    “As James Pethokoukis notes, 5.7% was the administration’s forecast (or, to be precise, transition team’s forecast) for May 2012 unemployment if Congress had enacted its $831 billion so-called stimulus bill, officially styled the American Recovery and Reinvestment Act of 2009. Congress balked, and here we are stuck with 8.2% unemployment.
    .
    Oops, sorry, wrong again! It turns out Congress did pass the so-called stimulus. The White House website even has video of Obama signing it into law on Feb. 17, 2009.”

    “But Obama, as president, persuaded Congress to “invest” $831 billion on the promise that doing so would create millions of jobs. That money appears to have been completely wasted, if not to have actually destroyed jobs. Now they tell us, to quote Alan Krueger, chairman of the president’s Council of Economic Advisers, that “problems in the job market were long in the making and will not be solved overnight.”

  26. “It then promises that if we waste money on Obama’s plan it will produce 3.675 million jobs.”

    And they were off by about a half-million. It’s been in all the papers.

  27. The graph here —

    http://www.aei-ideas.org/2012/06/miserable-may-jobs-report-suggests-u-s-in-recession-red-zone/

    was released by the Obama White House by Obama economists Christina Romer and Jared Bernstein in January 2009

    The chart released to sell the gigantic waste of taxpaer funds on Obama’s plans shows unemployment dropping to about 5.3% by the 3rd quarter of 2012.

    If a private company had promised those results in return for a $1 trillion “investment” THEY WOULD GO TO JAIL FOR FRAUD.

    It isn’t just that unemployment didn’t go down.

    The problem is that Obama defrauded the American taxpayers out of $1 TRILLION on a fraudulent promise to reduce unemployment to 5.3% by October 2012.

  28. The article contains nothing to back up Taranto’s jobs claim. Nothing.

    See if you can find an unbiased source somewhere — an article that isn’t a commentary.

    What’s amazing is how desperate you are to cling to your little myths.

  29. Geezer writes in 27: ““It then promises that if we waste money on Obama’s plan it will produce 3.675 million jobs.” And they were off by about a half-million. It’s been in all the papers.”

    Then unemployment would be at 6%, Geezer.

    The Obama White House transition team admits that 1 million jobs will drop the unemployment rate by 1%.

    Yet unemployment is effectively unchanged since Obama took office.

    THe fact that the unemployment rate has been essentially unchanged is proof that Obama’s claims about jobs created are FALSE.

    Obama has not created ANY jobs.

  30. If you kept up with the news, you’d know that the revised figures on the depth of the recession, which weren’t known at the time of the report you cite, showed it to be about 50% deeper than first thought. The Obama economic team initially pegged the stimulus needed at $1.2 trillion, and settled for $0.8 trillion, half of it in the form of tax cuts, which do not stimulate the economy as much as direct spending. The reality was that the economic team called for $1.8 trillion in spending but Larry Summers said asking for that much would never fly, so he cut the request to $1.2 trillion.

    In short, the stimulus was too small to fill the size of the hole in the economy.

  31. Your reasoning ability is incredibly limited. Your refusal to admit any evidence but the evidence that “proves” your point shows once again that you are nothing but a propagandist, and a poor one at that.

  32. What is there in BO’s background that would make you think he knows anything about economics? He was a professional ‘community organizer’ (aka, professional panhandler) and then a professional politician (aka, professional parasite). He’s never run as much as a lemonade stand.

    The ‘stimulus’ didn’t work- period. Like the auto union bailout, all it did was enrich his big contributors.

    Aren’t you sick and tired of hearing about the ‘saving’ of ‘America’s auto industry?’ Chrysler is now owned by FIAT, an Italian company, and of course, the unions. GM is owned by the UAW (and in the long term, GM will fail). Ford needed no fed money at all.

    Omaba and economics- LOL.

  33. “The ‘stimulus’ didn’t work- period. Like the auto union bailout, all it did was enrich his big contributors.”

    As usual, you provide nothing but your ignorant opinion. The stimulus and auto bailouts obviously helped the economy. You have nothing to base your opinion on but your own crankiness.

  34. Geezer wrote in #31: “If you kept up with the news, you’d know that the revised figures on the depth of the recession, which weren’t known at the time of the report you cite, showed it to be about 50% deeper than first thought.”

    By “news” you mean liberal propaganda. Mark Twain said that if you don’t read the newspaper you are uninformed. If you DO read the newspaper you are MIS-informed.

    The only sense in which the recession was deeper than expected is that OBAMA’S POLICIES MADE IT WORSE.

    Those who have to calculate plans for their businesses take into account what government policies are coming down the pike. Obama’s policies — particularly regulatory — caused businesses and investors to pull back and shrink the economy.

  35. All these comments and only one addressed the Walby paper? The Prebate is definitely not a tax refund in advance no matter how much AFFT wants to sell that fiction. The prebate is a cash grant entitlement costing almost $600 billion annually, and coming at a time when entitlements are squeezing out discretionary spending in the federal budget. We don’t need any more entitlements in the federal budget, and particularly this monster!

  36. The “Fiscal Impact” section in the White Paper above was fairly clear. First, through the prebate, each household is not taxed up to the poverty level, and then only on the new goods and services bought at retail. Second, the prebate would be approximately $528B, based on the 2010 household number. Third, the prebate REPLACES all of the “tax expenditures” ($1.3 Trillion) since the income tax is repealed by the Fair Tax Act. Looks more like a $772B stimulus to the economy than an entitlement of money that is yours to begin with when it is freed up by implementing the FairTax!

  37. “By “news” you mean liberal propaganda. Mark Twain said that if you don’t read the newspaper you are uninformed. If you DO read the newspaper you are MIS-informed.”

    How would you know? You clearly don’t read the newspaper. The figures are in the public domain. Rebut them at your pleasure, but show your math.

Comments are closed.