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Politics : Clinton's Scandals: Is this corruption the worst ever? -- Ignore unavailable to you. Want to Upgrade?

To: Axxel who wrote (8944)	11/14/1998 8:56:00 AM
From: Les H	Read Replies (1) \| Respond to of 13994

Your plan won't eliminate the debt. The economy would be in a severe recession. A number of industries would be devastated: chemical industry, travel industry, lodging industry, auto industry, restaurant industry, ... The only industry that would continue to grow in your plan would be the government. Of course, you come from a nonconsequential country (NZ) with restricted foreign import and a welfare state. As in Europe, the higher taxes would result in higher unemployment. At their lowest level, their unemployment rate is in the low teens. Most countries are looking at privatizing Social Security. Defined benefit plans don't work since economic assumptions (i.e., rosy scenarios) don't hold up. The problem with your plan and every high tax plan is it continues to disincentivize savings and investment. Then you have to create a patchwork of artificial programs, such as IRA's, Keogh's, and 401(k)'s, to make it appear people are saving. All of these programs indicate that the basic tax system doesn't work. (Its parallel is the educational system where the Democrats continue to propose a patchwork of programs but fail to fix the basic system) Also, with high taxes, more and more people cheat on their taxes and hide their income and assets. A low tax on income and sales makes it fairer for people who don't cheat and taxes those who hide their income, such as those in the cash economy.