Tuesday, September 29, 2009

Is Obama Planning a VAT Surprise for America?

The latest mad scheme by the President may be an attempt to introduce a Value Added Tax in the United States. James Pethokoukis at Reuters outlines his concerns this way:
So John Podesta, co-chairman of Obama’s presidential transition team, says a value-added tax is “more plausible today” than ever, adding that “there’s going to have to be revenue in this budget.” A few thoughts:

1) Podesta is also president of the George Soros-funded Center for American Progress, a liberal think tank closely allied with the White House.

2) It’s consensus among centrist economists, like those in the White House, that America will need to raise taxes to cover budget shortfalls and a VAT is the most efficient way of doing this.

3) At the G20, Obama promised more coordinated economic policies, including having the US lower its borrowing and consume less. This could be done via a VAT, which would also let the US have more tax synchronization with other OECD countries.

4) It seems like the WH is staring to redefine its pledge not to raise taxes on those making less than 250k as applying only to income taxes.

Bottom line: These Podesta remarks sure sound like a trial balloon by the White House.
Of course, this being Obama, it will likely be a VAT that is scaled against certain types of consumption, while directing consumption to other products. This is where Obama's Cass Sunstein comes in with his mad nudges of the people.

Very scary.

Will they attempt to blame the next crash that Bernanke is setting the stock market up for on too high deficits, and then justify a VAT as the way to "save" the economy?

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