In case you haven’t noticed, the U.S. government is scrambling to find ways to pay for all the unprecedented spending and borrowing that’s going on in Washington D.C. lately. Oh, and for the most recent version of socialized medicine, too.
And since printing more money is apparently not an option (they’ve already done that to the tune of a cool trillion), it will not fall upon the battered, bruised (and still bleeding) private sector.
Specifically? Manufacturers, who will bear the brunt of a proposed “Value Added Tax” that would suck untold billions out of the economy and put it into the hands of the federal government.
From The Hill:
A new value-added tax (VAT) is “on the table” to help the U.S. address its fiscal liabilities, House Speaker Nancy Pelosi (D-Calif.) said Monday night.
Pelosi, appearing on PBS’s “The Charlie Rose Show” asserted that “it’s fair to look at” the VAT as part of an overhaul of the nation’s tax code.
“I would say, Put everything on the table and subject it to the scrutiny that it deserves,” Pelosi told Rose when asked if the VAT has any appeal to her.
The VAT is a tax on manufacturers at each stage of production on the amount of value an additional producer adds to a product.
How much money would this VAT suck out of the economy?
It could be as much as $1.2 trillion – if those supporting the 20% rate get their way.
Let’s hope they don’t. This sort of nonsense is exactly the opposite of what we need to do to get this country moving again.
By Make it up as you go. October 7, 2009 at 11:55 am
The VAT will be just great! It will destroy what remains of the US manufacturing base, because it will be cheaper to import almost everything from offshore. Then comes the sweet, sweet trade war as we scramble to place protectionary tariffs on imported goods in order to combat the rising unemployment that will necessarily follow. It won’t last long though, because the Chinese won’t play that game. GO TEAM.
By larry October 7, 2009 at 12:01 pm
Yes, indeed! Let’s drive all industry away from our shores!
The Democrats are definitely in charge now!
By me October 7, 2009 at 12:57 pm
FUCK any traitor that wants a vat. this isnt the EU!
By Eric October 7, 2009 at 2:39 pm
@Make it up. No, I’m sure their plan will be to raise the tariffs on imports to make it fair for American companies. In this world everyone gets screwed but the government.
By Red October 7, 2009 at 2:46 pm
According to the past Controller of the U.S., our federal debt and unfunded liabilities add up to approx. $ 180,000 per person.
One thing we do not need to try anymore is Bush economics- cutting taxes on the rich and increasing federal spending.
If you want to see how bad off our nation is financially, check out this nonpartisan film clip.
http://www.iousathemovie.com/
By Make it up as you go. October 7, 2009 at 3:31 pm
Well, I think everyone agrees that “Bush economics” started the fire. But pouring $1T worth of deficit spending jet fuel on it is purely insane.
Cutting taxes on the “rich” would infuse much needed capital into the market. We have been down this road before, shortly after the reign of Carter I. Unless of course you believe the Keynesian multiplier works, in which case why don’t we just originate all capital spending at the government level?
Unless that is the goal already? Go Team.
By Red October 7, 2009 at 6:08 pm
Make it up as you go,
“Shortly after the reign of Carter??”….
Please look at the national debt Carter left on the link below, as compared to the debt left after 8 years of Reaganomics. Reagan cut taxes and increased federal spending much as Bush did. And this chart shows its a disaster for our financial welfare.
Reagan and Bush are mistakenly thought of as being great financially conservative leaders, yet the facts show their policies resulted in massive debt for our nation.
http://zfacts.com/p/318.html
By John Steinberger October 7, 2009 at 7:25 pm
As Ronald Reagan said, “If you want more of something, tax less of it.” If we want more production and investment we need to stop taxing it. FairTax is the answer!
By Rick October 9, 2009 at 12:59 pm
Lived through Carter and Reagan, I’ll take Reagan. We’re still being screwed by Carters policies.