Category Archives: Economics

Reform the Income Tax? No, Replace It!

The 16th amendment to the U.S. constitution was passed in 1913 and has become a drag on economic growth and an administrative nightmare for taxpayers. The cost of compliance with 74,000 pages of regulations costs individuals and businesses over $430 billion per year. The privacy of citizens is intruded upon when we are forced to report personal financial information to the IRS. The true cost of the massive federal Leviathan is hidden in products and services throughout the economy. No one interested in efficiency and fairness would create such a monstrosity from scratch.

There is an alternative that has been talked about for years. It was advocated by 2012 Libertarian presidential candidate Gary Johnson and would be a vital ingredient in jump starting the economy. It is a national sales tax, otherwise known as the Fair Tax, to completely replace the income tax, regressive payroll taxes, as well as estate and gift taxes, which are particularly damaging to small businesses. What are the benefits?

1) Workers keep their entire paycheck. That’s right, all of it.

2) All households receive a monthly prebate equal to the poverty level to pay for life necessities tax-free with the benefit that this makes the Fair Tax progressive in its operation.

3) Social Security and Medicare benefits are not affected, while consumption provides a more consistent tax base than income.

4) This is a one-time tax at the point of sale. Used goods sold are not taxed. Business purchases for production of goods and services are not taxed.

5) U.S. businesses have increased competitiveness in foreign markets due to the removal of the income tax.

6) Americans will no longer be required to provide personal financial information to the IRS. We would be free of the possibility of owing additional taxes come April 15th, and we wouldn’t be required to file a return to receive a tax refund caused by over-withholding.

The initial Fair Tax rate would be approximately 23%; however, if we scale back the federal government to its limited constitutional powers, this rate could be drastically reduced and the monthly prebate increased.

Additional information can be found at www.fairtax.org

I do not live in a fantasy land. I fully understand that major changes such as the Fair Tax will not be easy. The ones living in a fantasy land are Republicans and Democrats, looking only toward the next election or even the next donation from a wealthy donor or special interest group. Kicking the proverbial can down the road cannot last forever, as we hurtle toward economic calamity. The American people must one day exact retribution at the ballot box against those who have done so much harm to our economy. This disastrous road began with the creation of the Federal Reserve cartel and passage of the federal income tax in 1913 during the first term of Democratic President Woodrow Wilson. It continued when Republican President Richard Nixon cut the last link to gold in 1971, with the resulting skyrocketing cost of living. The two major parties bear responsibility for these terrible public polices.

It is too late for easy solutions. Only tough ones remain. Does anyone really believe that the Republican and Democratic Parties are the ones to fix the mess they have made?

—Ken Hamilton, LPAR Executive Committee member

What To Do about Taxes?

All libertarians argue for cutting taxes, but they don’t always agree on how or how much. My preference would be to eliminate all taxes and let Americans make voluntary donations to any government programs they would like to see continued. Two of the most talked about plans are the Flat Tax and the Fair Tax. I believe either plan would be an improvement over the current system, but popular forms of each leave much to be desired for libertarians.

The Flat Tax would create one rate that would apply to taxpayers at all income levels, while eliminating most or all deductions and exemptions. There are various proposals, some of which retain some deductions and provide exemptions for low-income Americans. Rates of 10%-17% are being discussed.

The Fair Tax would eliminate the income tax and create in its place a national sales tax. One of the biggest benefits would be making the IRS obsolete, since income would no longer be taxed and tax returns would no longer need to be file. The Fair Tax proposal offers a tax rate of 23% on all consumption, with a monthly pre-paid rebate paid to all lawful residents of the U.S. with a valid Social Security number. (Those willing to forego the rebate and Social Security benefits could presumably work without having one.)

Either proposal would be a big improvement over the current system. I think all libertarians can agree on that. Both proposals would free Americans from filing complicated tax returns, estimated to cost the average taxpayer nearly 27 hours to complete. Both eliminate double-taxation of certain income that is occurring under current tax law. Both would bring an improvement in economic growth. Both would stop the social engineering and spending manipulations that are rampant in current tax law.

The biggest benefit of the Fair Tax, in my opinion, would be the elimination of the IRS, along with all the civil liberties violations the IRS brings to the table. No longer would the government have any need to know about our income or to snoop into our bank accounts and our business activities. Employers would no longer have to work as tax collectors.

Most of the benefits of the Flat Tax over the Fair Tax center on the easier political road it faces, since flat taxes have been tried. There is also concern that a national sales tax could be created without ending the threat down the road of a new income tax on top of it. There are many arguments in favor of each proposal over the other, but I won’t go into all of those here. For more information along those lines, you might find these three articles of interest:

http://www.freedomworks.org/content/flat-tax-vs-fair-tax

http://ivn.us/2013/01/23/fairtax-vs-flat-tax-seven-reasons-to-support-the-fairtax-2/

http://dailycaller.com/2013/06/04/fair-tax-or-flat-tax/

But I also see problems with both. Proposals from both camps have a tendency to try way too hard to be basically revenue-neutral. With the level of taxation as high as it is today, why would we want revenue neutrality? We need to CUT taxes, STOP the printing presses at the Fed, and CUT GOVERNMENT SPENDING!

The Flat Tax leaves the IRS in existence. A big negative of the Fair Tax, in addition to the too-high rate being proposed, is its name. The FAIR Tax? Really? The only fair tax would be NO tax, and if that’s what we’re hoping to work toward, I can’t see any strategic sense in calling this the Fair Tax.

It’s one thing for libertarians to be ready to vote for either proposal as a step on the road toward greater freedom, but I think libertarians need to be looking at more radical proposals—proposals where revenue neutrality is not a concern.

—Kathleen Wikstrom, LPAR Vice-Chair

Drowning in a Sea of Red Ink

The declaration in the Biblical book of Proverbs, chapter 22, “the borrower is the slave of the lender,” is quite instructive to the current situation of the federal government and the deficit spending binge it has been on for over a decade now. It was bad enough during the George W. Bush presidency. The Iraq and Afghanistan Wars were being paid for through increasing the debt load on the American people, and the Republican Congress instituted a Medicare prescription drug plan that had no funding mechanism to pay for it. But toward the end of the Bush administration and continuing on through the Obama administration, this profligacy has increased to new record levels.

The 2009 stimulus program added even more debt for the American people to bear. Foreign investors helped this along by purchasing a large chunk of this debt, and the Federal Reserve has been more than willing to help by monetizing the debt as needed. The first yearly deficit that surpassed $1 trillion (the actual increase in the total national debt) occurred during the last full fiscal year of the Bush administration, coming in at a robust $1.2 trillion. The deficit grew even larger, hitting $1.9 trillion in the fiscal year ending September 30, 2011. After dropping to “only” $671 billion last year (as the sequester’s automatic spending reductions had at least some bite and revenues increased a bit), the national debt has already increased by approximately $800 billion in the first six months of this new fiscal year.

And if all of this awful fiscal news was not enough to digest, the American people are facing unfunded federal government liabilities of many tens of trillions of dollars in the upcoming decades. These are unfunded because, at the moment, there is not enough projected revenue to pay for much of the expected spending, which will be mainly in the area of entitlements (Social Security, Medicare, and Medicaid).

I propose that two steps are necessary to stem this tide of red ink that is swallowing the American Dream. First, we need a Balanced Budget Amendment to the U.S. Constitution that will require bringing the budget in balance within five years of its adoption. Doing so would help to stabilize the spending of the federal government at around 18% of GDP. That is still too high for a truly limited, constitutional federal government, but it would be a starting point. Spending levels could be ratcheted down from there, and at least the flow of red ink would be stopped at that level of government. There is no lack of ideas for prudently cutting down federal spending, and we need to start implementing at least some of them sooner rather than later.

Second, we need to ditch the Federal Reserve and its fiat paper monetary regime and institute a modern day gold standard. As former Congressman Ron Paul and Lewis Lehrman wrote in 1982, in The Case for Gold, page 159:

It is necessary to balance the budget and institute a gold standard together. The discipline required for one mandates the other. If government is to be limited in size, the budget balanced and the market free, gold will be a necessary adjunct.

As the Bible instructs in Deuteronomy 25:15, “A full and fair weight you shall have, a full and fair measure you shall have.” The Federal Reserve has manipulated the U.S. dollar since its creation in 1913 and has so far destroyed 96% of its value. At this point, I guess we should be grateful that they have left us with even four pennies on the dollar. This manipulation must come to an end, by instituting a sound gold-backed dollar and Balanced Budget Amendment, as a line of defense against deficit spending.

—Ken Hamilton, LPAR Executive Committee member

END THE FED – Arkansas!

Join us in Little Rock as we march to END THE FED with Christina Tobin and Adam Kokesh!

END THE FED Arkansas and the Libertarian Party of Arkansas have come together to sponsor the 2012 End the Fed March and Rally on Saturday, November 24th. Christina Tobin, founder and Chair of the Free and Equal Elections Foundation and Adam Kokesh, host of ADAM VS THE MAN will be our keynote speakers for this event.

Christina Tobin co-moderated the 2012 Presidential debate with Larry King and served as Ralph Nader’s national ballot access coordinator in 2008. Christina champions for electoral reform and bringing visibility to third party candidates. Read more about her HERE.

Adam Kokesh, Iraq war veteran, anti-war protestor and media personality will also speak at the rally. Kokesh is the creator of ADAM VS THE MAN podcast, a three-hour daily production about challenging authority, “sticking it to the man,” and living like a free, dignified human being. Find out more about Adam HERE.

Arkansan and Libertarian Revolutionist Dugan King will be introducing a local parallel currency called the ArBuck at the rally. To find out more about his plan, click HERE.

The march will begin at 11am at the Riverfest Amphitheater (400 President Clinton ), proceed past the Federal Reserve (Stephens, Inc. building at 111 Center St.), will continue to the Old State House Museum (300 W. Markham St.) where the march will pause for Kokesh to speak to the crowd at noon. The march will end at 12:30pm with a rally at the Belvedere near the Amphitheater (Riverfront Park). Following the rally with the keynote and other speakers, free entertainment will be provided by The Bryant Band and Steve Bates  (folk rock guitarist, singer and songwriter) at Juanita’s (614 President Clinton).

Other speakers include Chris Hayes, former Congressional candidate; Rodger Paxton, Chairman of the Libertarian Party of AR; David Chiodo, founder of END THE FED Arkansas; Mark Daniels, blogger, activist and founder of globalpoliticalawakening.com; and Britney Logan, VP of Young Americans for Liberty at the University of Central AR.

Now, how can you get involved with the End The Fed March and Rally?

There are three ways you can help!

1-      Spread the word about our event!
Post on your facebook, twitter or other social media accounts, send emails or call your liberty-loving friends and family and help us get the word out, even if you cannot attend.

2-      Attend our event!
We are expecting over 100 participants and we would love to see that number double in the coming days. You can RSVP on our facebook event page HERE.

3-      Make a donation to help us fund this event! You can see that information below:

Please consider making a donation to help us fund this event so that these freedom-fighters can help attract media attention as well as help us spread our message across Arkansas!  You can donate by clicking HERE, or contact Mark Daniels at501-570-6368 if you would like to make a cash or precious metal pledge to be made payable at the event.

Caery Concepts is providing End The Fed T-Shirts which will be available to purchase at the Rally. You will receive a free T-Shirt when you make a donation of $25 or more. We will have your shirt available for pick-up between 10-11am on Saturday morning at the Amphitheater.

We will see you Saturday on our quest to END THE FED!

End the Fed Arkansas Rally – Little Rock!

End the Fed Arkansas Rally – Little Rock! RSVP HERE! http://www.facebook.com/events/163591980431439/

We invite everyone in Arkansas from every political and ideological persuasion to join with us to take back control of our monetary and banking systems. This is an issue that affects EVERYONE. A mini-audit was done from 2007 – 2010 that exposed Trillions of (taxpayer backed) Dollars being used to not only prop up the “Too Big to Fail” institutions in the US, but also Trillions in extremely low-interest loans being given to foreign institutions like Deutsche Bank, Credit Suisse, and Arab Banking Corp. We’ve also learned that sitting members of the Regional Boards of the Fed have given their own companies low interest loans, which can only be described as a supreme conflict of interest, and we’ve also seen well-connected individuals taking loans from the Fed personally. It seems like everyone is getting bailed out by the Federal Reserve while we are still dealing with economic hardships on Main St. THIS MUST END NOW!

We will gather in Little Rock for a walk to the Federal Reserve (where we will be making stops to spread our message to the general shopping public and disperse literature and mail-in petitions to US Senators). We will end with a rally at the Fed, to continue promoting the message to the public.

This event is being sponsored by End The Fed Arkansas and the Arkansas Libertarian Party.

LPAR Chair Participates as a Panelist on Liberty Cap Talk Live

Rodger Paxton, Chairman of the LPAR, was a guest panelist on Liberty Cap Talk Live tonight. To listen to the podcast, go to Liberty Cap Talk Live and download the .mp3 file. You can also listen to it on your iPod device by going to iTunes. Other panelists were James Oaksun, Treasurer of the Libertarian National Committee and Jackie Fiest, contributor the the Liberty Conspiracy website and podcast. Thanks to Todd Andrew Barnett for hosting the show and having us all on.

Note: There is some explicit language in this podcast.

The Libertarian Alternative–Public vs. Private Roads

Welcome to the first of what I expect to be an ongoing blog series entitled “The Libertarian Alternative.” This series will be used to look at current policy in America and give you a plausible solution for those policies using a libertarian alternative. If there is a topic you would like to see in this blog series, please email me at chair@lpar.org and I will consider using your idea in the next blog!

“Roads? Where we’re going, we don’t need roads.“ – Dr. Emmett Brown, Back to the Future

There are just some services and products that only the government can provide, like roads, police, fire, etc., right? I submit that this is completely wrong.

First of all, lets look at what happens when the government runs the roads.  Most people think this is all done through the gas taxes that are paid on every gallon of gas sold in America. This is not the case. Depending on the source of the information, anywhere from 10% to 35% of the cost for our highway systems are paid by the gas tax. The rest comes from taxes on the purchase of vehicles, other taxes, borrowing from the general fund, and about 5% from tolls.

95% of this funding is taken from our pockets against our will to be used for a product that we may not even use! I have a friend who is legally blind. This man doesn’t own a car and does not drive. He walks to most places he goes to because he chose the location of his home based on the walking distance to certain places he frequents. In the rare instance of needing to travel

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Well, it's official, the recession ended more than a year ago!

You can thank your lucky stars, and the number crunchers, but the recession officially ended June of 2009. Yep, 15 months ago. Let’s all sing a chorus of “Happy Days are Here Again”.

Pay no attention to the fact that the official unemployment number, which by the way is bogus, is right at 10%. Haven’t you heard, it’s a jobless recovery (whatever THAT may mean). Pay no attention to the fact that incomes have lost ground over the past decade. Pay no attention to the fact that prices are increasing at a pretty hefty clip, regardless of the bogus CPI the government trots out to prove otherwise. Yes, pay no attention to that man behind the curtain, just keep watching the magic show.

Oh and that national debt thing, don’t worry your pretty little head about that either. At the rate that the Fed is inflating the money supply, it’ll all be “washed away” in the end anyhow. Of course that’s all well and good for the folks holding the debt, but not so good for us folks on down the “money chain” where the effects of the monetary inflation will be felt the worst.

Yes, boys and girls, there’s no fear Wonder Government is here! Why they can take away all that bad stuff and make it all better. Don’t believe me, why just ask them they’ll tell you, and you know it’s the truth because the government SAYS it’s the truth. Just think how much better things are going to be when they are in charge of health care!

Here’s the kicker. It’s our fault. We elected them. We KEEP electing them. We have the government that we deserve.

Ms. Lincoln and more of the same

Well, it seems that for all the commercials and bluster that Senator Lincoln piped on about during the primary elections she’s still more about back scratching than the moderate mantra, i.e. BS, of her primary electioneering.

In one of her commercials she said (and I’m mostly paraphrasing here) that she introduced some of the toughest banking reform regulations of any Senator in DC and “it’s gonna pass”. Well we are getting some of the details of her tough financial reform and how it’s going to operate. As usual it’s the same old crony crap that we expect out of our Continue reading