politics and economics

There are many things I know something about, but two that I am quite incompetent about are politics and economics. To my credit, I have in fact taken a university course in economics, and I did in fact get a good grade in it. I have never studied anything at all about politics.

However, despite this lack of understanding of these two subjects, I still feel like I have something worthwhile to say about a plan one of the Republican presidential candidates for 2008. I heard Mike Huckabee on NPR this morning, and he discussed an interesting concept: get rid of income tax. Again, I'm not economist, but I have this very huge gut feeling that making income tax a thing of the past is not going to do all that Huckabee says, and the immediate repercussions of doing so seem to be quite drastic and not at all helpful. I'm happy to hear others' comments - again, I really have no idea about economics, and this is all based on my perhaps naive common sense and the very small amount of microeconomics I remember, most of which is focused around tacos and burritos (for some reason those were the commodities my econ professor ALWAYS used for examples and exam questions...):

• Huckabee boldly and rather giddily presents his listeners with the notion that when income tax is over, the IRS will be no more. As if the IRS is some Evil Monster That Sucks The Life Out of All Living Organisms. As if our main enemy is the IRS. As if the IRS is what everyone gets mad about when they have to pay taxes. Personally, I don't blame the IRS for the taxes I have to pay; obviously they are not making the laws about taxes...it's people like senators and congressional members and presidents who are creating and approving the tax laws. But that's not my point. The point is that if the IRS goes away...that means over 100,000 people suddenly don't have a job. Great start - a 1% increase in unemployment, if I am calculating unemployment rates properly. From what I can gather, Huckabee doesn't have new jobs for these IRS workers in his plan.
• Too bad for the IRS, but that's not all who will be out of work. Ever needed a CPA? Won't need one anymore! Not for personal income tax returns, and also not for corporate taxes. Which means the people at your company who do all the tax stuff...yeah, they won't have a job either. And probably a few of the people who do payroll will be out of luck, also, because without payroll tax, there will be less work for payrollers to do, so some of them will get the boot.
• Let's pretend that all the people who lose their jobs at the IRS and accounting firms and company payroll offices are all able to find nice jobs at McDonald's. (I'd love to go on a tangent here, because Huckabee - and I admit I admire this about him - is big on encouraging health to prevent the need for treatment later on. The tangent would go something like this: nice job at McDonald's = eat lots of BigMacs = get more health problems = need to participate in those weight-loss programs Huckabee wants to make low/no cost = more money needs to be spent by the government on the weight-loss programs, but that's a problem, because there's no income tax and all the people who are eating all the Big Macs are at poverty level and so, due to Huckabee's plan, they're not really contributing any money to the funding of the government spending budget because all the tax they "spend" gets refunded back to them.) Let's pretend all those people find jobs, even if they're not at McDonald's (hm, maybe it's the new Wal-Mart that gets put in down the road... Those Wal-Mart people are so good at creating new jobs in places that need jobs! And they also seem to be pretty good at causing landslides). But I think it's fairly safe to say that the people are probably going to be making a bit less than what they used to. That means they're going to have less money to spend. And that means either they will use credit more or that less of their money will be spent on items that would put consumption tax money into the "government money pool." Credit isn't so cool, but that's another whole Hairy Beast. The larger issue is the fact that these (and, of course, all other) non-wealthy people will effectively not be paying any taxes. And the people who didn't work for the IRS, accounting firms, etc. -- who have high-paying jobs and are "wealthy" -- WILL. Does this seem any different from the way it is now?
• No corporate taxes. Let's get back to that issue. If you're a company and there's now tax on U.S. goods, why in the world would you want to buy U.S. goods? You're a big company with huge buying power and a big bottom line that reads MONEY. You simply buy more stuff from other countries who don't have all that tax on them. That, by the way, also means fewer U.S. jobs. This is because A)if corporations are buying less from the U.S., the U.S. has smaller need to employ people to make stuff for corporations to buy and B) smaller corporations or businesses won't be able to compete with the big corporations who can buy the cheaper non-U.S. goods...so the smaller guys will get shut down (okay, so maybe that one is a little anti-Wal-Mart biased...but still!).

Ugh, I'm getting tired of this!! My weariness definitely proves that I am not politically-minded... I acknowledge that there are some good points in Huckabee's plan and argument for his FairTax plan. That's great except that they're interspersed with such diabolically ungood points. I think I can muster a bit more strength to comment on a few other statements on Huckabee's website page about this issue. If nothing else, I at least want whoever reads this to be encouraged to not, not, NOT be swayed by the lovely, persuasive words Huckabee or others use to try to sway you emotionally into buying into a particular view. For example: Huckabee says that when his plan is implemented, "it will be like waving a magic wand releasing us from pain and unfairness." Um. Excuse me? ...I don't know about you, but I sort of feel uneasy about trusting someone who is going to just wave a magic wand and solve all the problems of the country. Which, truly, if you read it, is what he's saying! Yow! Perhaps if you were really desperate and were looking for someone to save you from your miserable existence this would be a welcome invitation. But I'd say that for the majority of Americans (in particular, the majority of those who would be reading Huckabee's website), they don't want magic. (Can you imagine... President Huckabee signs the FairTax bill into law...and POOF!!!! The Dow Jones Industrial Average soars to 20,000...everyone who's been laid off gets a call to come back to work IMMEDIATELY!...backruptcy is reversed...the people who foreclosed the houses and farms track down the displaced and bring them back home...the lame walk, the blind see, all pain is erased, there is racial and religious and ethnic and gender fairness as far as the eye can see...!)

One final rant - I've gotta go catch the last bus to my house!! - on this paragraph: "I believe that globalization, done right, done fairly, can be a blessing for our society. As the Industrial Revolution raised living standards by allowing ordinary people to buy mass-produced goods that previously only the rich could afford, so globalization gives all of us the equivalent of a big pay raise by letting us buy all kinds of things from clothing to computers to TVs much more inexpensively." Whom, precisely, do you mean by "us," Mr. Huckabee? I realize that you are interested in not just free trade, but also fair trade, but I think you forget that when goods are mass-produced...from the very beginning of its inception, somebody, somewhere is certainly not enjoying the "blessing" on society. I'm no history expert, but I do recall things like child-labor and deterioration of family life being quite rapid results of the Industrial Revolution. It sounds like Huckabee is convinced that the primary way to be happy is to have luxury items easily at one's disposal. Ugh...I could go on, but...I'll stop.

Tell me, what do you think of no IRS?