Why We Should Eliminate the Corporate Income Tax - Megan McArdle

Megan McArdle sets forth the arguments for why the corporate income tax should be eliminated. One of the best is the fictional idea that corporations actually pay the taxes. Ultimately, taxes are always borne by an individual somewhere:

You can't tax a corporation; you can only tax a person. For all the talk about corporate personhood, ultimately, all the income in a corporation ultimate ends up in the hands of some person: shareholders, employees, suppliers. Ultimately, we're not interested in the accumulation of money and power in "Ford Motor Company"; we're interested in the managers and shareholders who benefit from that accumulation.

This is a central concept of the FairTax also.

It's all good. Read the whole thing.

(via Instapundit)

Why the Capital Gains Tax Should Be Abolished - Six Reasons

The Tea Party Manifesto - One Possible Plank

Will Collier asks: "What is the Tea Party Manifesto?" He rightly points out that to date most of the Tea Party protests have been just about venting. There is no coherent message and no real proposals for what we should be doing differently. There's no agenda.

Well I have a suggestion. I've pointed out before that quibbling about what is the correct marginal tax rate under our current income tax system misses the fundamental point that the tax code is both inherently unfair and immoral to boot. If the Tea Party movement needs a rallying point, let it be the demand for a fundamental change in our tax system, one that transfers power back to where it belongs; with the people. Yes, I'm talking about the FairTax.

We need to start educating ourselves about the FairTax and then spreading the word about it as far and wide as possible. The politicians are scared to death of it. Why? because it would represent the largest shift in power from government (them) to the people (us) since 1776. Everyone would become a taxpayer, a true stakeholder because they would be taxed on what they consume, not on what they earn. As it is now, we are almost at, if not beyond the tipping point where more than 50% of the population pays no income tax yet is in the position of voting itself benefits to be paid by the rest of us. If the rallying cry of the participants in the original Tea Party was "no taxation without representation," it should be "no representation without taxation" today.

The Republicans Can't Just Play the Game, They Need to Change the Game

I just received a phone call from the Republican National Committee, asking me for a donation of $300 so "we don't just hand the Whitehouse keys over to the Democrats." It seems to me the Republican Party has already done just that. It has proven itself to be just as corruptible and every bit as spend-thrift as the Democrats and I'm not giving them a dime until I am convinced that they've done the soul-searching necessary to re-learn what it is Republicans are supposed to be about and what the Republican rank and file want from them and then they've got to start acting like Republicans again.

We want you to get Government out of our lives wherever possible. The economic mess we are in now, whether it is the housing crisis, the credit crisis, the auto industry crisis, the health insurance crisis or the energy crisis, every single one of these has its roots in government (political) interference in free markets. Every regulation, every little tweak to the tax code designed to bring about some perceived social good, distorts the markets and causes people and businesses alike to make decisions that make no sense otherwise.

The problem I see with the way the Republicans operate is that they are trying to play a game with rules that someone else has set but are not obeying themselves. The Republicans are fighting according to Marquis of Queensbury rules while the Democrats are fighting with brass knuckles and knives. This has to stop. The Republicans need to stop letting the other side frame the debate and start standing up for what it knows to be right, unapologetically and ignoring the howls of feigned outrage from the other side. Stop backing down every time someone calls you names. Recognize that you're being played and don't engage with that tactic.

The Republicans can't win under the current rules of the game because the other side is controlling the rules. Therefore, it is necessary to change the game. For example, stop quibbling about the tax code and what is just the right marginal income tax rate and talking about who is "paying their fair share". To do that is to buy into the corrosive class warfare/wealth envy rhetoric the other side likes to use to keep the voters divided against one another. The income tax is basically immoral and should be scrapped altoghether. It is also large part of why we have such a hard time competing globally. Our corporate tax burden is the highest or second highest in the world. Quibbling about the details loses sight of the basic fact that the income tax is wrong and Republicans shouldn't be afraid to say so. Yes, I'm talking about enacting the FairTax. Taxing consumption rather than income is the only truly fair way to raise tax revenues and the boost it would give to our economy is definitely something we need right now and it furthers the aim of getting government out of our lives.

The Tax Man, Liberty and Democracy

It's worth reading this whole post about tax havens at Samizdata but a couple of points bear emphasizing because they speak to the way our constitutional republic is not the same thing as a true democracy. The latter is nearly pure mob rule. While we elect our representatives democratically, our Constitution is designed to protect individual liberty against the tyranny of straight majority rule.

"....a lot of people make the assumption that wealth is collectively owned if enough voters wish it so and that therefore no-one has the right to flee from the looting intentions of such voters."

And this:

"......democracy and liberty are not the same thing, a point that has been remarked at this blog many times before. For sure, democracy may - may - be the least-worst way to kick out a government and replace it with a hopefully better one, but the idea that freedom comes from letting 51% of the electorate steal from 49% of the electorate has precious little to do with liberty. The right to own property and enjoy its fruits unmolested is as important as freedom of speech or the right to self defence."

This is exactly what deTocqueville was warning about when he said (and I paraphrase) that democracy would only last "as long as it took for the populace to figure out that it could vote itself largess from the public treasury." Perhaps if we take away the keys to the kitty from our elected representatives by enacting the FairTax, we could at least delay this process for a while longer by slowing down their give-aways to favored constituencies.