Wednesday, April 7, 2010

The Destruction Of The American Middle-Class

Here it comes folks; the dreaded VAT is coming at you like a freight train.  Paul Volcker isn't mumbling or hem-hawing:

Volcker, answering a question from the audience at a New York Historical Society event, said the value-added tax "was not as toxic an idea" as it has been in the past and also said a carbon or other energy-related tax may become necessary.

The VAT and the energy tax will be in addition to the groaning burden of income tax already breaking the back of America's middle-class.   It will be in addition to sky-high sales taxes.  Typically, the European countries whom Obama is emulating levy a 15-20% VAT on their citizens.  Expect to pay thousands and thousands more for a new car.  Your already unaffordable grocery bill will jump by 20%.  I cringe to think what we'll be paying for electricity and heating oil.

Working Americans are already bruised and battered.  Working Americans are hanging on by a shoestring to their vanishing way of life.

Corrupt Wall Streeters and Obama insiders are making huge fortunes, and laughing all the way to the bailed-out bank.   The recipients of our broken "entitlement" programs are raking in record payouts, and clamoring for more.

Our "representatives" have failed miserably.

Stand up, America.  Vote these idiots out in 2010 and 2012.  ALL OF THEM.


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  3. Translated:

    "You are lucky we let you keep any of it, you stupid peons.

    And if you don't like it, it's because you're racist!"

  4. Ponzi schemes collapse when you run out of suckers.

    Problem: we're out of suckers.

    Solution: import more suckers.

    Next stop: "comprehensive immigration reform".

  5. You know that is the idea, but anyone who would be a sucker has gone through the trouble of entering the country legally (in other words, they were already suckers). The ones for whom they want to comprehensively reform immigration are being given a free ride.

  6. Does anyone here realize that a VAT is a tax on labor, one that is cummulative from raw materials to end product?

    Also, that a VAT tax does NOT presume any gain (net profit) from which to draw tax payments, and that in a loss year, a firm will have to pay from equity...e.g. retained earnigns from a prior period(s)?

    Canada has a VAT that is handled with some attenuation, as I understand it, via tax credits. I'd like to know more about how Canda handles VAT's.

    The VAT's I've dealt with in the USA are not attenuated, but are not assessed at retail either....rather they are cumulative in the price at retail, similar to an excise tax.

  7. If manufacturers and wholesalers incur a 20% cost increase, that cost is passed on to the consumer. Consumers also pay the VAT directly.

    Prices go up. Way up.

    As I understand it, a VAT taxes the difference between materials cost and retail price, which includes, among other things, labor.

  8. Lady Red said: "As I understand it, a VAT taxes the difference between materials cost and retail price, which includes, among other things, labor."

    Labor, which has already been taxed to the individual laborer...and is then taxed again at the gross amount, not AGI, to that same laborer when he/she becomes the retail consumer.

    Clear away all the smoke, mirrors and Kool Aid, it is a double tax on labor, and must be paid by a producer whether or not there is any net income from which to pay it...e.g., in loss years the producer pays from equity ....e.g., retained earnings.

    VAT's are due and payable at each transaction step in the process, not just applied to retail. Supplier A takes raw material and makes it in to an alloy...adding value, and producer A pays a VAT tax on that increased difference in value. The producer B takes that alloy and makes a widget, adding value, upon which he is taxed on the added amount...compounding at each step in the proces until it reaches the consumer who pays it as part of the widget cost.

    VAT may or may not be added again at the retail level, depending on the jurisdiction & process definition. If the jurisdiction has a sales/use tax, then that tax is applied to the retail price, which includes the VAT accumulation. In short, there can be a 3rd tax on the same values for labor & price.

    Now all y'all bend over and grab your ankles, so's Queen Regent Nancy the P can drive you home with her majik dildo.

  9. BTW..Michigan has had a VAT clone for decades now...called the Single Business Tax (SBT) then revised slightly to be the Michigan Business tax (MBT). It is paid indivually by each and every company that handles a product from raw materials to end item. It must be paid even if said company(s) has no profit for the year due...e.g.,the perfect that is due and payable even if there are no proceeds from which to pay it.

    And it's done us wonders here...we lead the nation with the highest unemployment, and have for some time now. See we have both a VAT and a Sales/Use tax to compound the madness.