Why not 10th-amendment taxation to the hilt? Instead of federal taxes coming from individual incomes, property, businesses, and transactions across the nation; the federal government should tax the *state* governments on their revenue and leave to the states all domestic taxing powers. Jurisdictional competition between states for residents would then regulate tax rates and policy strategies toward minimizing the cost and impact of generating tax revenue, the opposite of what happens when the federal government has such sweeping control over taxation, to a man. This would also mean it wouldn't be the states needing federal money for everything, which currently gives the federal government extensive constitutionally dubious leverage over the states. Imagine for a moment that every member of Congress was more interested in saving their state government money rather than raiding the federal treasury to send some back home - a literal tragedy of the commons. Fully returning domestic taxation to the states would establish such pro-efficiency incentives in Congress, they might as well call themselves DOGE.
Also the added benefit of making states more competitive among other states to attract populations and businesses while keeping excessive taxes in check.
1870 to 1913 is on gold standard, after government spending getting bigger, government debase with gold and issue income tax. is this how history want us to know?
The base of the problem is the level of government expenses that's far too high. It must be decreased ruthlessly : cut anything that can be cut, use the AI to replace bureaucrats and make important services run more smoothly... Less expenses = you can decrease taxes by that much.
@jeffreygoss8109 the biggest impact of gov corruption is regulations, to cripple the competition. Remove that power to regulate and the problem will vanish
@jeffreygoss8109 the issue comes from the power to regulate the economy as it's used against potential competition. Remove that power, lobbying will become pointless and will naturally vanish. This power also synergises strongly with insider trading as companies send a lot of data to the gov. 2 birds with one stone.
25% tariffs declared on Canada and Mexico and 10% on China already. I am open to seeing how they work for a while to see what happens. I can't say they are a silver bullet and will allow us to drop income taxes. That would be a wonderful thing though, since tax is theft.
@@hanknorris5642all those tariffs will just be added to the price. And domestically made crap will just jack up their prices. So we will have income taxes and tariffs
@@hanknorris5642tariffs unfortunately does not affect the exporter it affect the importer so if a US company imports it has to pay the federal government the tariff as it is a tax payer and that cost is put on the consumer by the import company by increasing there pricing
Bob, you need to continue this. You should look at a comparison of detriments of each taxation system. People need to understand why one might be better than the other. Just take the fact that the government needs to shrink as a given. And a side discussion that needs to occur is the fact that in a Hard money system, the people have a way to take true income from the government and therefore keep it smaller.
16:19 but when people stop buying imports, the dollar would appreciate compared to foreign currencies, and that would make American exports more expensive, and thus, foreigners will stop buying them, and also imports would be cheaper again and people will buy imports again. I mean, when you consider the system of floating exchange rates that we have today, people will pay the tarrfis somehow eventually.
In your scheme would you tax everything including food or medications? Would you have any carve-outs? Would you have any "sin-taxes" or increased taxes on items the current government in power wants to dissuade people from purchasing?
The other problem is of course that mitt Romney and others have highlighted that close to 50%, something like 49% of people in the USA do not pay any federal income tax. That would mean that those people would all be taxed now with tariffs and that's a pretty huge percentage of the country that's going to be pretty unhappy now!
That's misleading (shocking coming from Mitt Romney, I know). Romney's talking about people who pay those taxes directly, but strictly speaking, no American pays the tariffs directly. They pay them indirectly in higher prices for goods, but if you did the same analysis for income taxes, they would certainly affect everyone as well.
I had just gotten used to the left wing calling me an idiot after years of it and now all of a sudden I'm back to the right wing calling me an idiot. It's as if I've time-traveled back to the Bush era.
Most Americans are not required to even file a 1040 form, and are not subject to Federal Income taxes. There are only 2 criteria that an individual is required to file. 1. You MUST reside within the confines of Washington District of Columbia. 2. You must receive compensation from your labor directly from the Federal Government. I. E. U.S Postal worker. If you do NOT meet either one of these criteria, and still opt to fill out the 1040, Your signature on the document is signed under oath, and if you're found to be 'lying', is when they convict you of 'tax fraud'. So, don't even file, and there's nothing for them to come after you for. Don't necessarily believe me, do your own research.
No. We don't produce enough of what we consume. Our trade imbalance is too extreme. We would be taxed to death while producers would still outsource many items. Also, if we end up in a war, tariffs don't work at all for a number of reason.
Tariffs are a fancy way of doing sales taxes but only on foreign produced products. The great part is it's paid up front and the only ones who would go to jail or be scared of non-compliance would be smugglers.
You can't tax (tariff) your way to prosperity. If a Chinese widget costs 20% more, this is paid by US consumers. If the US comsumer changes their purchasing behavior and purchase something made in the US instead, there will be no tariff income. And, guess what, there will be retailatory tariffs on US goods sold abroad. Very short-sited.
@@Jackaroo. I guess if country x has tariffs on our goods then turnabout is fair play. However, I would be against unilater tariffs unless utilized for short-term pressure on the target country government.
@@makun16 I agree. I think there should be a fixed corporate tax rate, low enough to entice coroprations to establish business here in the US. I'm against double taxation though.
As far as the topic of 'free trade', IMHO, the US Government engaging in free trade with a foreign country is unconstitutional. I say this simply because the Constitution stipulates that any state of the union are prohibited from charging any fees among the states, guaranteeing 'free trade' amongst those states that chose to inter into the United States of America. Therefore, any 'free trade' with a non member of the union, should never enjoy the benefits of the same standard of free trade. If a state (or country) wishes to enjoy free trade with the US, they must create their own state constitution, that is compatible with the US Constitution (just like every state in the Union had too), then petition for statehood. Then and only then, can a 'state' enjoy free trade among all the other states in this great nation.
If Trump swaps taxes for tarrifs, if it's dollar for dollar it will be neutral BUT the incidence will not. The washback from other nations will also impact, but offset is preference for US made to avoid tarrif... so will change incidence.
Well it is constitutional so yes it would work matter of fact the constitution says that's the way the federal government is to be funded through tariffs and fees, by the way the federal income tax is unconstitutional.
So as I have had it described to me, the government does not need our tax dollars to spend money, because it can print it’s own money. The massive money printing however causes inflation, so it collects taxes to remove money from circulation. Now if this is how things actually function I am curious as to how tariffs rather than income taxes will change things.
That's modern monetary theory - a misleading name if you ask me, and no government actually uses it. I don't believe that the theory is functional, but there is plenty of debate around. I would argue that taxation is the thing that gives fiat currency it's legitimacy, because it's the only thing you can use to pay your taxes. Without this, there is nothing really stopping you from trading using a different means of exchange.
@@JEP-Tech They raise FAR less money than taxing the economic activity that would have happened without the tariff in place. They are a high precision tool that is still debatable whether ultimately useful.
@ I want to know what the orginal comenter meant by "they don't work". That's such a vague stament. There are all sorts of different ways to extort money from tax cattle, I'm not debating other taxes are more effective at extorting money from us.
I'm fine with the tariffs over income tax. I choose how much I spend, so to me, tariffs are like sales tax. I choose to pay sales tax when I buy something.
Nailed the key Libertarian issue. An individual chooses when to pay that tax, Income taxes rob you blind without any consent before you even see your own check. Sales/Tariff combo is the solution.
The Federal Government should not have ANY interaction with individual citizens, when it comes to taxation. Tariffs are a fantastic idea, but will probably have to be supplemented by other means, so as to reduce printing currency out of thin air. I suggest that the Federal Govt. charge each state by means of amount of representation. Leave it up to the states to decide how or where to get the funding to send to the Federal Govt.
Philosophically I suppose tariffs are better than taxes. But if you wanted to replace federal income taxes, you would have to massively gut federal spending. That isn't going to happen! But at least it's being talked about.
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But my friend , the tariffs will just heavily increase consumer prices and its this extra cost to the american consumer that will be going into the government coffers. Americans switching to local manufacturers isn't feasible in the vast majority of cases and if they do, the costs will be very high. Lose lose as far as I can see it. Welcome back heavy inflation too.
I didnt get that income tax would be eliminated from hearing his speech. I think only somwhere between the top 50% and the top 10% of income earners for that year should pay any income tax. All tax deductions should be removed to simplify the process and remove all loopholes. Income tax shouldnt be a burden of the worker, but a forced charity and a way to make exploitative salaries less appealing.
What would cutting welfare to foreigners, when they come to our Country? Would that help, or are you talking about cutting a lot of federal programs, like SS and Medicare?
"Think tank, or Drunk tank? To even pretend to "question" whether tariffs could replace income tax in America is ludicrous. Our tariffs on Russia has only hurt the US and most of western europe. Regardless, you know the "controllers" of the collective west would "never" give up that tax money coming in from their vassal states, even if they made more money with tariffs they will still keep it all! Be serious.
no because they will just QE to cover the cost of the reduction in taxes trump won't be able to reduce regulation/compliance/litigation costs enough to make U.S. manufacturing viable prepare for higher prices - forever
One thing I think people don’t realize is the income tax is merely a small part of the withholding coming out of their check. Social security and Medicare are still going to be funded by withholding. I believe it was DiLorenzo who said on average you have to earn 70k to even start actually paying income tax.
@@sneakthieve of course everyone’s situation is different but most people making 40k a year get a refund. The married standard deduction is 30k. Earned income credits. Etc. DiLorenzo is probably correct after you figure the “refunds” in. I’m merely trying to be precise in our hatred, that it’s not just the income tax but all withholding that needs to go. If someone paid 2500$ in federal income withholding and got back 3000$, they didn’t pay income tax they got 500$ from the feds. Slot of folks talking solely about the income tax use it as a blanket term for all with holding and as RP pointed out. Half the population doesn’t oat.
@@johnm6736 I see. I love Tom and am actually a member of the Mises institute (need to renew for 2025) but I think he’s a bit high on the figure. Of course, like you, I think any amount of withholding is too much. No itemized deductions, no kids, married filing separately, no tax credits, is my specific situation. My typical return between state and fed would cover my Medicare deductions. Leaving my fed income withholding and Social security, as a net loss. My gross income didn’t exceed 70. I think a caveat would be if there are kids or not. Have a great weekend man. It’s time to have a beer
We'll see. I don't want to prematurely praise or admonish Trump's tariff plan. I want to see if a positive impact is achieved. Let's give it 6 months and see. Can't be worse than the last 4 years of Bidenomics.
@@hanknorris5642 is there an example of any market interference of any kind bringing about a net positive effect?! Someone always benefits, someone always loses, the economy as a hole always suffers by some amount.
Where did he say that? I'm not saying you're wrong, I just wish to see it. I know Harris used that talking point against Trump; she was claiming that Trump's tariff plan was a national sales tax and that was said to hurt Trump. So, it would be interesting to see that he said it, himself.
@@murawskky Its still in planing. I saw that clip 2 days ago. Give it a week. Trump is a ass , but a good businessman. It would be bad business to make a move if it didn't come out ahead of whats in place now. As you know the global economy is changing and our tax system has to evolve with it or we will go the way of Rome.
I found this a very stimulating conversation. I gist I got out of it is “the devil is in the details.” I would only add that there is a reason that we exported much of our manufacturing base; environmental concerns. We like clean air and water. We’d rather let less developed nations suffer pollution than in our country. I wish that my friends who are Trump supporters shouldn’t get so defensive whenever I try to have an honest discussion on the pros and cons of policy. Thank you for putting this out, I shared it on my Facebook.
I see it as essentially the same as "sjw" or "social justice warrior." Someone who obsesses over the plight of "marginalized groups" (which is effectively any group that isn't straight, white men) and makes a public display of their apparent empathy or "awakeness." Consequently, most "woke" people will be fierce advocates of the government enacting redistributist economic policies and treating marginalized groups paternalistically. The push for diversity, equity, and inclusion in all forms of organization (which is a real thing) can be seen as a product of "wokeism." It doesn't matter what term you use, "wokeism" describes a real phenomenon.
Wokeness: An aggressive push for diversity/equity/inclusion, usually based on the belief that outcomes which lack these things are indicative of discrimination and/or unfair social treatment. This is the best definition I’ve found, credit to Mentiswave on YT
From a macro perspective, what’s being suggested sounds awesome, except it is not for at least 2 reasons: 1) taxes help control inflation pressures by regulating the amount of reserves in the economy and 2) it’s a recipe for shrinking the middle class even further. We need taxes to help capitalism function for everyone, not just the wealthy.
Trump said, "We have to produce." He understands, before globalization, using forced, uncompensated labor in Communist countries, exporting dollars (debt), Americans produced the raw materials for industry in Britain and European countries. At the same time, the US had industry in the North, to produce much of what average people needed. On top of that, American women also produced homemade textiles, such that consumerism wasn't a thing. People always had to buy some things, but no one was sitting around doing nothing, whining for handouts. Massive overproduction of goods by forced, uncompensated, starving labor in Communist countries, while the US exports dollars (debt) (globalization) has come to its finite mathematical conclusion. Americans are going to learn how to make and do things again. If we don't, the Chinese will enslave us. The masters of today are the slaves of tomorrow. Our own politicians have already sold us out to the Chinese. European leaders have sold their people. Our government, and European leaders actually think it's a great idea to enslave us, force us to work for nothing, to increase the oligarchs' fortunes. They can't be trusted.
This is indeed the point. If every other country on the planet except the US sank into the ocean tomorrow, the US would need to figure out how to produce what it can at home with what it has. Unlike nearly every other country we DO have nearly every resource at hand to do so. "We have to import pencils from China" does not have to be the case.
They should switch to a land tax. 10% of the value of acreage in your county. Very few bureaucrats required to track it. Punishes Democrat voting urban areas. Encourages efficient use of land and disincentivizes zoning regulations. I'd also like to see a complete halt of trade with any country that allows slavery or is Socialist (but I repeat myself). And a 20% tariff on countries that don't follow suit. I'd also like to see lots of vice taxes. Legalize drugs but heavily tax them. As well as internet smut and sugar. And finally an automatic 20% sales tax that kicks in if the country declares war. That's what I'd do if I was in charge.
Food prices would rise dramatically, the tax would be very regressive as food is a major component of low income earners expenditure. People then would start growing their own food leading to pressure to raise taxes etc. Simplistic taxes create distortions.
@John-c4r1o all taxes create distortions. I think this would create far less than income taxes. Everytime land is sold the county would record the acreage and price. Then every census would calculate the price of land in a county over the preceding 10 years and use that to charge people per acre. This would require a fraction of a fraction of the bureaucrats income tax does. Not to mention very little invasion of privacy. It would also solve some distortions like billionaires buying all the land to hedge against inflation and zoning regulations. Our current system incentivizes the wealthy to hoard assets and avoid income, reversing that seems like a positive to me. It also creates much less perverse incentives for the government than income tax. Also, I would like to see the rate much lower than 10% but that's what it would take to replace income tax. I did the math.
@@jeffreygoss8109 so the average farm is 643 acres at $4080 per acre. Their average revenue is $651,546. That average farmer if married currently pays $181,506 in federal income taxes without deductions. Under my proposed system he'd pay $188,904. But if his wife or kids worked outside the farm they would not be taxed.
I don't know. But reforming the income tax should be a higher priority. Including capital gains is a requirement. Otherwise, the wealthy will not pay their fair share. On the other hand, a tax could be levied on the wealthy one time.
“Fair share” Sick of this feel good terms. Make it the same for everyone and get rid of the thousands of pages of rules that only people with money with can afford to navigate the garbage
Big Business are government cronies. Big Business is joined at the hip with the government. The government has absolutely no reason to go after their buddies, especially since the American public cannot grasp the fact that their politicians are bought and paid for. The elites are the elites no matter their occupation or what facade they put on.
Are you forgetting the most important function of taxation. It does not pay for spending it is a tool to reduce M2. Without giving this ridiculous proposal much thought, I would say that this would cause great inflationary pressure because it would increase M2 and not lower it. You are the one that seems to be so concerned with inflation why have you not mentioned. No instead you try to inject that same spending arguments that your ilk has had since 1971. You won't be happy until SS and Medicare are gone. I'm just your average run-of-mill Professional Civil Engineer I'm not an economist, I took Micro and Macro in college and aced both without ever going to class except to take the tests. Compared to every engineering class I had, econ was a walk in the park, it is definitely far from rocket science. The problem with many of you is that you think you are intelligent. You complicate rather simple relationships and rules and laws to the point that you intimidate uninformed people of you inane ideas like fear of the big bad National debt. Opposition to our current FIAT system by so-called Austrian libertarians has more to do with politics than real world macroeconomics.
Stay in your lane. Monetarism died in the 80s. GenEd macro and micro courses are nowhere near representative of the entire field of economics, they're there to pass as many students as possible. You were taught that the cow is spherical and in a vacuum. Unfortunately, social sciences are significantly more complex than natural sciences, and economics is no exception. There are no simple rules or laws. Austrians are somewhat aware of this, but arrive at the wrong conclusions and dismiss valid approaches to complexity.
Why not 10th-amendment taxation to the hilt? Instead of federal taxes coming from individual incomes, property, businesses, and transactions across the nation; the federal government should tax the *state* governments on their revenue and leave to the states all domestic taxing powers.
Jurisdictional competition between states for residents would then regulate tax rates and policy strategies toward minimizing the cost and impact of generating tax revenue, the opposite of what happens when the federal government has such sweeping control over taxation, to a man.
This would also mean it wouldn't be the states needing federal money for everything, which currently gives the federal government extensive constitutionally dubious leverage over the states. Imagine for a moment that every member of Congress was more interested in saving their state government money rather than raiding the federal treasury to send some back home - a literal tragedy of the commons.
Fully returning domestic taxation to the states would establish such pro-efficiency incentives in Congress, they might as well call themselves DOGE.
Also the added benefit of making states more competitive among other states to attract populations and businesses while keeping excessive taxes in check.
Great idea!
Repeal the Sixteenth Amendment to abolish direct federal income taxes.
Here before the statists start crying in the comments
😭
1870 to 1913 is on gold standard, after government spending getting bigger, government debase with gold and issue income tax. is this how history want us to know?
The base of the problem is the level of government expenses that's far too high. It must be decreased ruthlessly : cut anything that can be cut, use the AI to replace bureaucrats and make important services run more smoothly...
Less expenses = you can decrease taxes by that much.
Start with all of Congress. Bribing AI would have to be more difficult or maybe cheaper
@jeffreygoss8109 the biggest impact of gov corruption is regulations, to cripple the competition. Remove that power to regulate and the problem will vanish
@jeffreygoss8109 the issue comes from the power to regulate the economy as it's used against potential competition.
Remove that power, lobbying will become pointless and will naturally vanish.
This power also synergises strongly with insider trading as companies send a lot of data to the gov. 2 birds with one stone.
Base problem is that we have been scammed into thinking government is necessary and democracy is ethical.
Your approach is wrong. At least to balance the budget, you must cut the things that can NEVER be cut: Medicare, SS, and DoD.
That would be incredible, but I have zero confidence that he will even try it. He will not stop income tax or inflation.
25% tariffs declared on Canada and Mexico and 10% on China already. I am open to seeing how they work for a while to see what happens. I can't say they are a silver bullet and will allow us to drop income taxes. That would be a wonderful thing though, since tax is theft.
@@hanknorris5642all those tariffs will just be added to the price. And domestically made crap will just jack up their prices. So we will have income taxes and tariffs
@@hanknorris5642tariffs unfortunately does not affect the exporter it affect the importer so if a US company imports it has to pay the federal government the tariff as it is a tax payer and that cost is put on the consumer by the import company by increasing there pricing
Swap to tax revenue completely from tarriffs. Then bring back privateer shipping smugglers to avoid all the tariffs.
Bob, you need to continue this. You should look at a comparison of detriments of each taxation system. People need to understand why one might be better than the other. Just take the fact that the government needs to shrink as a given.
And a side discussion that needs to occur is the fact that in a Hard money system, the people have a way to take true income from the government and therefore keep it smaller.
RE: cuts in spending: What if they were able to end the frequent pentagon "missing/unaccounted for trillion dollars"
Good start, but you wouldn't balance the budget (another $1T to cover) if the DoD and VA disappeared today.
Tariffs are more American than baseball or apple pie.
Would love for you to have Peter St. Onge on to talk about this.
16:19 but when people stop buying imports, the dollar would appreciate compared to foreign currencies, and that would make American exports more expensive, and thus, foreigners will stop buying them, and also imports would be cheaper again and people will buy imports again. I mean, when you consider the system of floating exchange rates that we have today, people will pay the tarrfis somehow eventually.
We should tax the government. Every government employee and every politician have to pay 100% tax.
you're gonna wind up getting both
I agree with replacing income and payroll taxes with a federal sales/consumption tax. Tariffs could be used on top as needed.
That was Thatchers' policy direction in the 1980s. Since then, both rates have risen, along with spending. Not sure about tarrifs.
In your scheme would you tax everything including food or medications? Would you have any carve-outs? Would you have any "sin-taxes" or increased taxes on items the current government in power wants to dissuade people from purchasing?
The other problem is of course that mitt Romney and others have highlighted that close to 50%, something like 49% of people in the USA do not pay any federal income tax. That would mean that those people would all be taxed now with tariffs and that's a pretty huge percentage of the country that's going to be pretty unhappy now!
www.urban.org/sites/default/files/publication/26506/901527-Five-Myths-About-the-Percent.pdf
That's misleading (shocking coming from Mitt Romney, I know). Romney's talking about people who pay those taxes directly, but strictly speaking, no American pays the tariffs directly. They pay them indirectly in higher prices for goods, but if you did the same analysis for income taxes, they would certainly affect everyone as well.
I had just gotten used to the left wing calling me an idiot after years of it and now all of a sudden I'm back to the right wing calling me an idiot. It's as if I've time-traveled back to the Bush era.
Most Americans are not required to even file a 1040 form, and are not subject to Federal Income taxes.
There are only 2 criteria that an individual is required to file.
1. You MUST reside within the confines of Washington District of Columbia.
2. You must receive compensation from your labor directly from the Federal Government. I. E. U.S Postal worker.
If you do NOT meet either one of these criteria, and still opt to fill out the 1040, Your signature on the document is signed under oath, and if you're found to be 'lying', is when they convict you of 'tax fraud'. So, don't even file, and there's nothing for them to come after you for.
Don't necessarily believe me, do your own research.
No. We don't produce enough of what we consume. Our trade imbalance is too extreme. We would be taxed to death while producers would still outsource many items. Also, if we end up in a war, tariffs don't work at all for a number of reason.
"Its not going to achieve my maximalist Utopian dreams, so we should stick with what hasn't been working."
Tariffs are a fancy way of doing sales taxes but only on foreign produced products. The great part is it's paid up front and the only ones who would go to jail or be scared of non-compliance would be smugglers.
24:06 if they instituted a national sales tax the bastards would likely keep the damn income taxes too.
no income tax but you pay 50 dollars for a pencil
Oh we'll have income tax AND pay 50 bucks for a pencil
@@deborahdean8867No you don’t
@@luisduclias3118 we WILL.
You can't tax (tariff) your way to prosperity. If a Chinese widget costs 20% more, this is paid by US consumers. If the US comsumer changes their purchasing behavior and purchase something made in the US instead, there will be no tariff income. And, guess what, there will be retailatory tariffs on US goods sold abroad. Very short-sited.
Every other country already has tariffs on US goods.
Then why not only tax corporations at a fixed competitive rate and not the individual? No write offs, just pay 7% of earnings.
@@Jackaroo. I guess if country x has tariffs on our goods then turnabout is fair play. However, I would be against unilater tariffs unless utilized for short-term pressure on the target country government.
@@makun16 I agree. I think there should be a fixed corporate tax rate, low enough to entice coroprations to establish business here in the US. I'm against double taxation though.
It would also push away world from dollar that makes us imports unfairly cheap and exports inflation back. Trump could be goodhearted but is dumb
As far as the topic of 'free trade', IMHO, the US Government engaging in free trade with a foreign country is unconstitutional.
I say this simply because the Constitution stipulates that any state of the union are prohibited from charging any fees among the states, guaranteeing 'free trade' amongst those states that chose to inter into the United States of America.
Therefore, any 'free trade' with a non member of the union, should never enjoy the benefits of the same standard of free trade. If a state (or country) wishes to enjoy free trade with the US, they must create their own state constitution, that is compatible with the US Constitution (just like every state in the Union had too), then petition for statehood.
Then and only then, can a 'state' enjoy free trade among all the other states in this great nation.
Nah, mental gymnastics.
Very solid idea.
Trumps tariffs: Same old Smoot-Hawley Tariffs. Resulted in deepening great depression.
You know who argued against exactly this? Adam Smith.
If Trump swaps taxes for tarrifs, if it's dollar for dollar it will be neutral BUT the incidence will not. The washback from other nations will also impact, but offset is preference for US made to avoid tarrif... so will change incidence.
2:38 The federal reserve was established in 1913. Hint, hint.
If majority of the federal government is shut down tariffs could fund the government
Well it is constitutional so yes it would work matter of fact the constitution says that's the way the federal government is to be funded through tariffs and fees, by the way the federal income tax is unconstitutional.
The federal income tax only actually referred to income of coporate profits, not by every mans labor.
The FED is also the problem
So as I have had it described to me, the government does not need our tax dollars to spend money, because it can print it’s own money. The massive money printing however causes inflation, so it collects taxes to remove money from circulation. Now if this is how things actually function I am curious as to how tariffs rather than income taxes will change things.
That's modern monetary theory - a misleading name if you ask me, and no government actually uses it. I don't believe that the theory is functional, but there is plenty of debate around. I would argue that taxation is the thing that gives fiat currency it's legitimacy, because it's the only thing you can use to pay your taxes. Without this, there is nothing really stopping you from trading using a different means of exchange.
Tariffs don’t work, historically.
History started before 1914.
Don't work in which sense? They raise money for national governments, they clearly work as intended.
@@JEP-Tech They raise FAR less money than taxing the economic activity that would have happened without the tariff in place. They are a high precision tool that is still debatable whether ultimately useful.
@ I want to know what the orginal comenter meant by "they don't work". That's such a vague stament. There are all sorts of different ways to extort money from tax cattle, I'm not debating other taxes are more effective at extorting money from us.
Except when they did. I think you're just too used to cheap foreign goods and watching all jobs shipped overseas.
I'm fine with the tariffs over income tax. I choose how much I spend, so to me, tariffs are like sales tax. I choose to pay sales tax when I buy something.
Surefire way to destroy the government and our country but yeah enjoy not buying things? Fucking genius
Nailed the key Libertarian issue. An individual chooses when to pay that tax, Income taxes rob you blind without any consent before you even see your own check. Sales/Tariff combo is the solution.
What about lowering taxes some and raising tariffs especially in products we excel at producing here?
How about 10% on income and match the same amount that each country charge us on our exports?🤔
The Federal Government should not have ANY interaction with individual citizens, when it comes to taxation. Tariffs are a fantastic idea, but will probably have to be supplemented by other means, so as to reduce printing currency out of thin air. I suggest that the Federal Govt. charge each state by means of amount of representation.
Leave it up to the states to decide how or where to get the funding to send to the Federal Govt.
Philosophically I suppose tariffs are better than taxes. But if you wanted to replace federal income taxes, you would have to massively gut federal spending. That isn't going to happen! But at least it's being talked about.
The first administration to attempt something like DOGE. The attempt to attack the issue from several angles is in effect.
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It would work to siphon money from the working mans pocket to the rich man. It's a regressive tax in essence.
And we'd have more working men to pull from, lowering the overall burden, because there would be domestic workers.
But my friend , the tariffs will just heavily increase consumer prices and its this extra cost to the american consumer that will be going into the government coffers. Americans switching to local manufacturers isn't feasible in the vast majority of cases and if they do, the costs will be very high. Lose lose as far as I can see it. Welcome back heavy inflation too.
I didnt get that income tax would be eliminated from hearing his speech.
I think only somwhere between the top 50% and the top 10% of income earners for that year should pay any income tax. All tax deductions should be removed to simplify the process and remove all loopholes.
Income tax shouldnt be a burden of the worker, but a forced charity and a way to make exploitative salaries less appealing.
What would cutting welfare to foreigners, when they come to our Country? Would that help, or are you talking about cutting a lot of federal programs, like SS and Medicare?
"Think tank, or Drunk tank? To even pretend to "question" whether tariffs could replace income tax in America is ludicrous. Our tariffs on Russia has only hurt the US and most of western europe. Regardless, you know the "controllers" of the collective west would "never" give up that tax money coming in from their vassal states, even if they made more money with tariffs they will still keep it all! Be serious.
no because they will just QE to cover the cost of the reduction in taxes
trump won't be able to reduce regulation/compliance/litigation costs enough to make U.S. manufacturing viable
prepare for higher prices - forever
Loved this! My question: How might Bitcoin play into balancing a rise in federal debt? A SBR? Thank you!
One thing I think people don’t realize is the income tax is merely a small part of the withholding coming out of their check. Social security and Medicare are still going to be funded by withholding. I believe it was DiLorenzo who said on average you have to earn 70k to even start actually paying income tax.
more like $40k
I’m not so sure about that. Holding my 2024 W2. Looks like I paid a thousand more in federal withholding compared to social security.
@@sneakthieve of course everyone’s situation is different but most people making 40k a year get a refund. The married standard deduction is 30k. Earned income credits. Etc. DiLorenzo is probably correct after you figure the “refunds” in. I’m merely trying to be precise in our hatred, that it’s not just the income tax but all withholding that needs to go. If someone paid 2500$ in federal income withholding and got back 3000$, they didn’t pay income tax they got 500$ from the feds. Slot of folks talking solely about the income tax use it as a blanket term for all with holding and as RP pointed out. Half the population doesn’t oat.
@@johnm6736 I see. I love Tom and am actually a member of the Mises institute (need to renew for 2025) but I think he’s a bit high on the figure. Of course, like you, I think any amount of withholding is too much. No itemized deductions, no kids, married filing separately, no tax credits, is my specific situation. My typical return between state and fed would cover my Medicare deductions. Leaving my fed income withholding and Social security, as a net loss. My gross income didn’t exceed 70. I think a caveat would be if there are kids or not.
Have a great weekend man. It’s time to have a beer
Wtf is withholding
Brr skibidi dom dom dom yes yes
Bussin sigma flex
Hey, Bob! I miss ya buddy!
Is there an historical precedent?
Is that precedent inapplicable today?
We'll see. I don't want to prematurely praise or admonish Trump's tariff plan. I want to see if a positive impact is achieved. Let's give it 6 months and see. Can't be worse than the last 4 years of Bidenomics.
@@hanknorris5642 is there an example of any market interference of any kind bringing about a net positive effect?! Someone always benefits, someone always loses, the economy as a hole always suffers by some amount.
1. Yes. 2. Yes, unless you expect the government to voluntarily shrink itself.
Bob should re-record this video.
No flow.
It seemed like he was struggling to get to the end of almost every sentence.
🤷♂️
Bob's great, but that's normal, unfortunately
Land Value Tax a la Henry George
Hes said that hes going to replace income tax with a national sales tax not just tariffs. Do your home work! You are making your self like a fool.
Where did he say that? I'm not saying you're wrong, I just wish to see it. I know Harris used that talking point against Trump; she was claiming that Trump's tariff plan was a national sales tax and that was said to hurt Trump. So, it would be interesting to see that he said it, himself.
@@murawskky Its still in planing. I saw that clip 2 days ago. Give it a week. Trump is a ass , but a good businessman. It would be bad business to make a move if it didn't come out ahead of whats in place now. As you know the global economy is changing and our tax system has to evolve with it or we will go the way of Rome.
On a tactical level. Avoiding withholding is easier than avoiding sales tax and price increases from tariffs
I found this a very stimulating conversation. I gist I got out of it is “the devil is in the details.”
I would only add that there is a reason that we exported much of our manufacturing base; environmental concerns. We like clean air and water. We’d rather let less developed nations suffer pollution than in our country.
I wish that my friends who are Trump supporters shouldn’t get so defensive whenever I try to have an honest discussion on the pros and cons of policy.
Thank you for putting this out, I shared it on my Facebook.
What is the definition of woke-ism?
a dog whistle for midwits.
I see it as essentially the same as "sjw" or "social justice warrior." Someone who obsesses over the plight of "marginalized groups" (which is effectively any group that isn't straight, white men) and makes a public display of their apparent empathy or "awakeness." Consequently, most "woke" people will be fierce advocates of the government enacting redistributist economic policies and treating marginalized groups paternalistically. The push for diversity, equity, and inclusion in all forms of organization (which is a real thing) can be seen as a product of "wokeism." It doesn't matter what term you use, "wokeism" describes a real phenomenon.
I think it means political correctness and being a social justice warrior. That's what I think when someone's says woke-ism
Wokeness: An aggressive push for diversity/equity/inclusion, usually based on the belief that outcomes which lack these things are indicative of discrimination and/or unfair social treatment.
This is the best definition I’ve found, credit to Mentiswave on YT
Duck duck go is a good way to search for that definition. More private than G**gl*.
From a macro perspective, what’s being suggested sounds awesome, except it is not for at least 2 reasons:
1) taxes help control inflation pressures by regulating the amount of reserves in the economy and
2) it’s a recipe for shrinking the middle class even further. We need taxes to help capitalism function for everyone, not just the wealthy.
Trump said, "We have to produce." He understands, before globalization, using forced, uncompensated labor in Communist countries, exporting dollars (debt), Americans produced the raw materials for industry in Britain and European countries. At the same time, the US had industry in the North, to produce much of what average people needed. On top of that, American women also produced homemade textiles, such that consumerism wasn't a thing. People always had to buy some things, but no one was sitting around doing nothing, whining for handouts. Massive overproduction of goods by forced, uncompensated, starving labor in Communist countries, while the US exports dollars (debt) (globalization) has come to its finite mathematical conclusion. Americans are going to learn how to make and do things again. If we don't, the Chinese will enslave us. The masters of today are the slaves of tomorrow. Our own politicians have already sold us out to the Chinese. European leaders have sold their people. Our government, and European leaders actually think it's a great idea to enslave us, force us to work for nothing, to increase the oligarchs' fortunes. They can't be trusted.
This is indeed the point. If every other country on the planet except the US sank into the ocean tomorrow, the US would need to figure out how to produce what it can at home with what it has. Unlike nearly every other country we DO have nearly every resource at hand to do so. "We have to import pencils from China" does not have to be the case.
They should switch to a land tax. 10% of the value of acreage in your county. Very few bureaucrats required to track it. Punishes Democrat voting urban areas. Encourages efficient use of land and disincentivizes zoning regulations.
I'd also like to see a complete halt of trade with any country that allows slavery or is Socialist (but I repeat myself). And a 20% tariff on countries that don't follow suit.
I'd also like to see lots of vice taxes. Legalize drugs but heavily tax them. As well as internet smut and sugar.
And finally an automatic 20% sales tax that kicks in if the country declares war.
That's what I'd do if I was in charge.
And screws farmers
Food prices would rise dramatically, the tax would be very regressive as food is a major component of low income earners expenditure. People then would start growing their own food leading to pressure to raise taxes etc. Simplistic taxes create distortions.
@John-c4r1o all taxes create distortions. I think this would create far less than income taxes. Everytime land is sold the county would record the acreage and price. Then every census would calculate the price of land in a county over the preceding 10 years and use that to charge people per acre. This would require a fraction of a fraction of the bureaucrats income tax does. Not to mention very little invasion of privacy.
It would also solve some distortions like billionaires buying all the land to hedge against inflation and zoning regulations. Our current system incentivizes the wealthy to hoard assets and avoid income, reversing that seems like a positive to me. It also creates much less perverse incentives for the government than income tax.
Also, I would like to see the rate much lower than 10% but that's what it would take to replace income tax. I did the math.
@ I understand wanting to keep the rich from hoarding land but I still see farmers being screwed.
@@jeffreygoss8109 so the average farm is 643 acres at $4080 per acre. Their average revenue is $651,546. That average farmer if married currently pays $181,506 in federal income taxes without deductions. Under my proposed system he'd pay $188,904. But if his wife or kids worked outside the farm they would not be taxed.
I don't know. But reforming the income tax should be a higher priority. Including capital gains is a requirement. Otherwise, the wealthy will not pay their fair share. On the other hand, a tax could be levied on the wealthy one time.
Capital gains tax is even more damaging economically than the personal income tax
“Fair share” Sick of this feel good terms. Make it the same for everyone and get rid of the thousands of pages of rules that only people with money with can afford to navigate the garbage
@@Cotswolds1913capital gains creates far fewer perverse incentives for the government.
Big Business are government cronies. Big Business is joined at the hip with the government. The government has absolutely no reason to go after their buddies, especially since the American public cannot grasp the fact that their politicians are bought and paid for. The elites are the elites no matter their occupation or what facade they put on.
Taxing capital gains for the future or past gains already realized? Because they are wanting to tax ANTICIPATED capital gains now.
Are you forgetting the most important function of taxation. It does not pay for spending it is a tool to reduce M2. Without giving this ridiculous proposal much thought, I would say that this would cause great inflationary pressure because it would increase M2 and not lower it. You are the one that seems to be so concerned with inflation why have you not mentioned. No instead you try to inject that same spending arguments that your ilk has had since 1971. You won't be happy until SS and Medicare are gone. I'm just your average run-of-mill Professional Civil Engineer I'm not an economist, I took Micro and Macro in college and aced both without ever going to class except to take the tests. Compared to every engineering class I had, econ was a walk in the park, it is definitely far from rocket science. The problem with many of you is that you think you are intelligent. You complicate rather simple relationships and rules and laws to the point that you intimidate uninformed people of you inane ideas like fear of the big bad National debt. Opposition to our current FIAT system by so-called Austrian libertarians has more to do with politics than real world macroeconomics.
Stay in your lane. Monetarism died in the 80s. GenEd macro and micro courses are nowhere near representative of the entire field of economics, they're there to pass as many students as possible. You were taught that the cow is spherical and in a vacuum. Unfortunately, social sciences are significantly more complex than natural sciences, and economics is no exception. There are no simple rules or laws. Austrians are somewhat aware of this, but arrive at the wrong conclusions and dismiss valid approaches to complexity.
Yes. Easily.
People pretending to be economic experts while sitting on the toilet 🚻 😂😂😂😂😂😂😂😂😂😂. I'm here for the comments, n they are no disappointing 😊😊😊😊
Here I sit all broken hearted
Came to pontificate
And only farted