Thats one of the best articles against Fairtax Ive seen. Fairtax doesnt even slow down at stupid, for many of the reasons you mentioned. It just wouldnt work.
But you left out a couple things.
For one thing, the exemptions that would surely be sought, and given. For example, nursing homes will CORRECTLY raise a fit -- many of its patients are on medicaid, and almost all struggle to pay it, as is. Cancer centers -- do they really believe someone will be charged 23% tax on their chemo? Their brain surgery? (yes they charge the sales tax on that too).
Few realize, its even on RENT. All these people would scream bloody murder. One group after another.
None will scream quit so loudly as the Pentagon, however. The goverment -- according to FT book and web sites -- pays the same sales tax. On everything. Read page 148 of Bortz book if you dont believe me. Ironically, Boortz uses the fact that government would pay it . He writes "... the federal government would itself be a major taxpayer: all sales at the retail level, whether to individuals or government, will carry the tax. "
Now, can you imagain the US Army paying 2 1.5 million in tax, on ONE tank. (M1a2 Tank cost over 4 million). Wait till they see a tax bill on an Aircraft carrier, air craft radar systems, ect.
Clearly, the Pentagon wont be paying sales tax. In fact, its just the worst economics on earth to imagine that the government CAN pay its own taxes. IF so, why not just charge the government all the taxes, have it pay itself. Its that kind of lunacy that underlies the FairTax plan. Its not a little dumb. Its a lot insane.
I dont think Dick Armey's solution is fair. Yes, its slick. He has pushed it for years. Its also a con game of sorts. Notice that when he pulls out that tax form from his pocket - that post card -- the only thing on the income line is "wages, salaries and business income" or something like that. Not a word about cap gains, dividends, or unearned income. Very slick Dick - but he doesnt fool me. He just wants ONLY work to pay taxes. He doesnt want to admit that, or draw attention to that, but thats really his plan.
Ron Wyden has the best plan in my book. Take a look at it. Ron is lousy at promotion, though, Im surprised he ever got elected. Great guy, smart guy, but only in Oregon could he win. He doesnt have the kind of stage presence or dynamic speaking ability to get his plan front an center.
