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Chairman's Report - February 8, 2019

SOCIALISM, STATE OF THE UNION AND THE FAIRTAX

One remark in President Trump’s State of the Union address got a standing ovation from Republicans in attendance but also from many Democrats, including Senator Chuck Schumer, the minority leader.  The remark, “We are born free, and we will stay free. Tonight, we renew our resolve that America will never be a socialist country.”
 
Hearing that remark and the reaction to it further emphasizes the dichotomy of advocating freedom but keeping the income/payroll tax system in place when there is a better alternative that does make all of us free to control our life and level of taxation—the FAIRtax.
 
DEFINING TERMS
 
First, what is “Socialism”?  The Merriam Webster dictionary has the following definitions:

  1. Any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
  2. A system of society or group living in which there is no private property
  3. A system or condition of society in which the means of production are owned and controlled by the state
  4. A stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done 

The same dictionary defines Communism as:

  1. A system in which goods are owned in common and are available to all as needed
  2. A theory advocating elimination of private property
  3. A totalitarian system of government in which a single authoritarian party controls state-owned means of production

Many of us are also familiar with the following extract from Chapter Two of Marx’s Communist Manifesto:

  1. A heavy progressive or graduated income tax 
  2. Abolition of all rights of inheritance 

Both socialism and communism take power away from the citizens and place it in the hands of the bureaucrats.
 
HOW THE INCOME/PAYROLL TAX AND THE ESTATE TAX ARE TENETS OF SOCIALISM AND COMMUNISM

Here are some of the effects of the income/payroll tax system: 

  • Increases political power and control by Congress and the bureaucracy because the citizens have to rely on the government to tell them how much tax they will pay and what they have to do to keep more of their money;
  • Allows Congress and the Swamp to promote dissension between different classes of people;
  • Promotes that people making more money should fund programs for people making less money to “equalize” people;
  • Makes even the wealthy fear having their wealth confiscated by Congress. 
  • Increasing the income tax rates to 70% and imposing a wealth tax concentrate more power in Congress and the bureaucrats.  \
In addition, consider the recent proposal by Senator Bernie Sanders that will reduce the estate tax exemption to $3.5 million and increase the top rate to 77%.  This is starting to come closer to Marx’s recommendation to abolish all rights of inheritance.

HOW THE FAIRTAX PROMOTES FREEDOM

A basic economic principle is that all taxes reduce the amount that can be spent on consumption.  The income/payroll tax is removed from our hands prior to actual consumption.  We therefore have already paid a “tax” on our consumption because all we can use to make purchases is what is left after the taxes are removed.

Therefore, when you make a purchase for $1.00, you had to earn between $1.20 and $1.50 to earn enough money after the income/payroll taxes.  Most of us don’t think of the cost of goods this way and Congress and the Swamp like that—we don’t really see the impact of the cost of government on each of us.
 
The FAIRtax eliminates this confusion and lifts a veil that Congress has put over our eyes—much like drawing back the curtain to reveal the Wizard of Oz to be not a formidable presence at all.  By giving each of us 100% of our check, no deductions for federal taxes, we then know how much something costs.  When we make the $1.00 purchase we pay $1.30.  The amount remaining for consumption is likely very close to the same, but with the FAIRtax every consumer in the U.S. knows exactly the cost of the federal government.  This concept makes many Members of Congress very uncomfortable.
 
The FAIRtax then:

  • Eliminates the concern we feel that Congress is going to change their mind about how much of our earnings we can keep—we keep all that we earn and it is not up to Congress;
  • Is very difficult to avoid and it makes selling tax favors to different groups very hard because all of us will see changes to the very simple FAIRtax;
  • Fits the economic principle of the best type of tax—a tax that raises the amount of money needed in the most efficient way with the least adverse effect on the people paying the tax.
  • Unlike the income tax, the FAIRtax doesn’t tax used goods and allows people more choice as to how much tax they pay;
  • The Prebate or Tax Credit reduces the actual FAIRtax rate for all but the wealthy;
  • Fully funds Social Security and Medicare and ensures that it will remain funded and not be an empty promise;
  • Eliminates the filing of tax returns for individuals and almost all businesses and allows the elimination of the IRS;
  • Grows the economy and real wages much more rapidly than the income/payroll tax system. 


BUT WHAT ABOUT HELPING THE NEEDY AMONG US?
 
As Congressman Rangel told me in the early 1990’s, the revenue available for Congress to spend is ultimately more important than the method of taxation.  When revenues from collection of the FAIRtax are received by Congress, then Congress, in full view of all of us, can decide to fund programs to directly assist the needy. 
 
Instead of hiding the tax benefits it sells to the highest bidder, Congress will have to make changes to rates on different goods or exclude certain goods from tax in the open so that all of us can see and question what happened. 
 
Does passage of the FAIRtax mean that the U.S. will not go further toward socialism by creating spending programs that redistribute wealth or provide many benefits?  No, but it just means that the cost of these programs will not be easy to hide.  Even though there seems to be a belief in D.C. that increasing the national debt is ok and it never has to be repaid, we know that economically this increase in debt can cause many serious problems to our economy.


CONCLUSION
 
None of us want people to go hungry or not be able to get the medical care they need.U.S. citizens donate more to charity than any other country.  We, as a nation, care about others. 
 
Objectively, we can see that the intentions of some of the new Democratic Members are well-intended and mean to correct a problem that they perceive is harming many Americans. However, what is offensive is the way that Congress wants to decide for the rest of us rather than let us decide by clearly showing us the cost of the new programs and how much the FAIRtax rate will need to increase to pay for the new programs.
 
Winston Churchill said, “If you’re not a liberal at twenty you have no heart, if you’re not a conservative at forty, you have no brain.”This may be harsh, but it is true that the attitudes of people who get up and go to work each day tend to change as they experience more of life.We become more attuned to what is ideal and what is achievable.
 
If the purpose of our tax system is to collect the needed money in the most efficient manner and in a way that is easiest on the tax payer and best for the economy, then it is simple—enact the FAIRtax. 
 
Isn’t it time to take back control from D.C.?
 
President Trump, “Embrace the FAIRtax and real tax reform!  What have you got to lose?”
 
It is time to PASS THE FAIRTAX! 
 
The truth is the truth.  Remember, if we don't continue to tell the truth and demand a change, then this quote from George Orwell's 1984 may foretell our children's future:

“If you want a picture of the future, imagine a boot stamping on a human face—forever.”


WHAT CAN EACH OF US DO
 

Call up the local or D.C. offices of your House Member and two Senators and you can use the following script:
  • I am sure that Representative ____ or Senator ____ is in favor of everyone obeying the income tax laws.
  • After they assure you that their boss is not in favor of anyone breaking the law, ask if they are aware of the Cebula study showing $9 trillion of evaded income/payroll taxes over the next ten years.
  • Since most will say they don’t believe their boss has seen the study, either drop off a copy or get an email address and send a copy to them for their boss.
  • Say you are going to call back in a week and ask what the Representative or Senator is going to do to stop this evasion.
  • In a week, call back and ask specifically what the Representative or Senator is going to do to enforce the law.
  • They probably will say their boss believes that simplifying the income tax will handle the problem.
  • Explain that when people evade income taxes, they are also evading the 15.3% payroll/Medicare tax and state income tax.  So it is unlikely that they are going to pay 30% or 40% when they were paying 0% because they have already decided it is okay to cheat.
  • Say that the only way to reduce evasion is to increase by tens or hundreds of thousands the number of comprehensive IRS audits done each year.
  • Point out that Evaders do not self-identify by putting an “E” on their income tax return.
  • 80% of the people likely to be audited are trying to comply, but they will be forced to endure these IRS audits as well.
  • Ask if the Member is in favor of this?
  • If they say no, then ask again how the Member proposes to stop people breaking the income tax laws.
  • Then explain that the way to handle evasion without unleashing the IRS audits is the FAIRtax.  

If you can see your Member or attend a town hall and ask these questions, you can be even more effective.


FAIRTAX POWER RADIO

#146 SOTU, Tax Migration & the FAIRtax
 
The FAIRtax Guys review the State of the Union address as it relates to REAL tax reform, the FAIRtax.  President Trump made the case for “Pro American” legislation, not partisan legislation.  The FAIRtax fits the bill.  The FAIRtax is good for all Americans, especially the working poor. The FAIRtax Guys explain this and other themes in the SOTU address that are compatible with the FAIRtax. 
 
Then the conversation swerved into an article about tax migration; people moving from tax punishing states to tax friendly states.  This prompted a caller from New York to contact the show to give a first hand account of living in a tax punishing account.
 
Listen to the discussion, the calls and the comments from the Facebook Live viewers in this wide ranging conversation.  Enhance your knowledge of the FAIRtax.
 
If you believe the FAIRtax is good for America, let others know by turning them onto FAIRtax Power Radio - the ONLY weekly FAIRtax digital TV show in the country!  Watch every Wednesday at 11:30 AM (ET).  We are streaming to Facebook LIVE (www.facebook.com/fairtax).  If you’re not a fan of Facebook, you can watch the show on www.xcluded.tv at the same broadcast time - or any time. 
 
FTPR podcasts for each show are posted on Spreaker (http://bit.ly/2oesbk7), iTunes & iHeart Radio every Friday morning.  A free FAIRtax Power Radio app is available for iOS and Android.  Since it’s a podcast, you can download it and play it whenever it’s convenient for you.
 
The FTPR weekly episodes are shared to a number of Facebook pages:

www.xcluded.tv is a subscription based site which costs $30 per year and features a number of other shows along with FTPR with no commercial interruption.
 
Please help us educate as many Americans about the FAIRtax as possible.  Be sure to tell everyone you know about this great new format for FAIRtax Power Radio.  Whether you watch the weekly video or listen to the weekly podcast, this is a great way for more Americans to learn about the best tax reform plan in Congress at this time.
 
Tune into our video broadcast each Wednesday.  Or, if you prefer, you can listen to the podcast of the show later.  You can listen to FTPR on any platform - Mac or PC, iPhone or Android. And it’s 100% free.  Listen on Spreaker.com (http://bit.ly/2oesbk7), iTunes (http://apple.co/1Te8VdF) or iHeart Radio (http://bit.ly/2eqEG7y) on your computer or smartphone.  The easiest way to listen to FTPR on your smartphone is by downloading the free FTPR app.  Just search for “FAIRtax Power Radio” in your app store, download the app and start listening.  
 
Remember, FTPR digital TV every Wednesday at 11:30 AM (ET) followed by the podcast on Friday morning.  Please listen and tell everyone you know about the FAIRtax Power Radio.  The FAIRtax: Once You Understand It, You’ll Demand It!
 
A SIMPLE INTRO TO THE FAIRTAX - AMERICA’S BIG SOLUTION
 
America’s Big Solution provides a starting point in your study of the FAIRtax and is meant for people of any age.  And you can download it to your tablet or smartphone right now.  It’s also available in print form.  See below.

Do you know someone who would like an introduction to the FAIRtax and would prefer to read about it in a booklet rather than search online for Tweets, Posts and Shares?  If so, America’s Big Solution is their best choice.
 
America’s Big Solution is an introduction to the FAIRtax written by Terry Tibbetts, author of A Spartan Game: The Life and Loss of Don Holleder, with help from Ron Maiellaro, President of the Florida FAIRtax Educational Association.  
 
You can buy an electronic version of ABS as follows:  AMERICA’S BIG SOLUTION is available for only $2.99 for the Amazon Kindle (http://amzn.to/1WIRHry), the Barnes & Noble Nook (http://bit.ly/1XeG8bH) and Apple iOS (http://apple.co/1tnqK0P).  
 
You can purchase a print copy at the same Amazon link above for $9.25.  Regardless of whether you choose the electronic format or the print format, you’ll find AMERICA’S BIG SOLUTION will give someone the boost they need to begin their study of the FAIRtax and the suggested resources to learn more. Buy AMERICA’S BIG SOLUTION now!
 
LINKS TO MORE INFORMATION
 
These links will help you promote and support the FAIRtax, make yourself familiar with the links below. We always do our best to keep our AFFT community up to date, and you can stay ahead of the curve using these convenient sites.

 
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