The Fair Tax | Part 2 (Transcript)

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                     The Fair Tax Part 2

Hi, Bob Barney here for The Plain Truth today, brought to you by theplaintruth.com, the place to go to to find out what’s happening, what you can do about it. And we’re in part two of a program that I have promoted for many years now, which is called The Fair Tax. So this is The Fair Tax part two.

We’re going to have a lot more of what Neil Bortz has to say, his arguments why we should have a fair tax, what it will do for you, what it will do for your income, and frankly, what it’s going to do for this country and getting out of its debt that it’s in and learning how to live within our means by living by the money we collect and by the boom that will happen in this economy that will actually collect more tax dollars in the fair tax than we will ever collect with an income tax. And that’s just going to happen because the economy will boom like we’ve never seen it boom before. Can you imagine making $1,000 a week and being able to spend $1,000 a week and not maybe $690? That’s what it’s going to happen.

So we’re going to continue with this Neil Bortz show about the fair tax. And I think, again, if you pay attention, you’re going to see it is the way we need to go. As I get into the story of the fair tax,just remember these things.

Corporations don’t pay taxes. Businesses don’t pay taxes. They collect them from customers, from employees, and from owners, shareholders, pass them on to the government.

Number two, most people in this country do not have any clue how much taxes they actually pay. And number three, our tax code is a massive source of power for politicians in Washington, D.C. And oh, by the way, one more thing I would like you to know, the graduated income tax, the system we’re operating right now, was mandated, if you will, suggested, if you want to be kinder, in the Communist Manifesto well over 100 years ago by Karl Marx. The graduated income tax was deemed to be absolutely necessary if you were going to take a country into the paradise of communism.

Oh, and by the way, so was public education. Okay, how did this all come about? Toward the end of the 19th century, the beginning of the 20th, in other words, from the 1990s into the early 2000s in this country, we had three businessmen in Houston, Texas, fabulously wealthy businessmen, Leo Lindbeck, Jack Trotter, and Bob McNair. He’s now the owner of the Houston Texans football team, and I believe the other two have passed.

At any rate, back in the 1990s, these men, well in the late 1900s, these men all in Houston, they sort of had a little hobby among themselves, in addition to running their businesses. They liked to get together and tackle impossible problems. Hey, there’s this.

Hey, there’s that. How can we address this problem that’s been bothering people so long? How could we address that problem? They came up with solutions, for instance, in Texas governmenteducation, public schools, that really improved education in the state of Texas. But at any rate, as lore has it, and I’ve met and talked with all of these people, as I said, they were all very, very successful and all members of boards of directors of various corporations.

When they got together for golf or whatever, they would often complain about board of directors meetings and how much time they had to spend on tax issues. I mean, at each board of directors meeting, they spent far more time, it seems, worrying about the tax consequences of various corporate moves that they might recommend or vote against, the tax consequences, than they did about the advancement of the actual business. Taxes, taxes, taxes.

So finally, as it goes, one of these men said to the other, you know, we spend all our time talking about taxes. Why don’t we do something about it? You mean, why don’t we come up with another tax system for this country, better than the Internal Revenue Service, better than the graduated income tax, better than corporate and business income taxes? Yeah, let’s come up with something better. So they put a bunch of money, over $20 million of their money, into the effort of finding a better tax system for this country.

They hired economists from schools like MIT and Chicago. They did research. They did publicfocus groups.

They talked to businessmen, to politicians, and among themselves, they said, whatever this working group comes up with, whatever sort of a tax plan they come up with, we’re going to get behind it, and we’re going to push it, because it’ll make things better in our country for individuals and for business. Now, these three men, they were all pretty certain that the $20 million in research that they did, the economists, the businessmen, the tax lawyers, the focus groups, they were pretty sure that they were going to come back and recommend a flat tax. Instead of a graduated income tax, they were going to come back and say, no, no, let’s just do a flat rate for everybody.

And they were fully prepared to support that and promote that, but that’s not the way it worked out. Instead, these people came back, and they reported to McNair, to Trotter, to Lindbeck, what we need is a consumption tax. Now, let me add something here.

When these people were given all of this research money and sent out to do their work, there were some requirements that had to be met, and one of them was that whatever plan they came up with had to be revenue neutral. In other words, the money to the federal government, the tax revenue to the federal government had to be the same under their plan as it was currently, revenue neutral. They couldn’t come say, well, let’s cut government spending by a half and do this, or let’s increase government spending and do that.

No, revenue neutral. So what did they come up with? A consumption tax. In other words, you pay taxes to the federal government when you consume, when you consume goods or when you consume services.

And that basically was going to be the only tax revenue that the federal government had. As a matter of fact, how’d the word fair tax come up with? Well, it was in one of the focus groups. After the plan was put together, they had focus groups and they would explain the entire plan to these people.

In fact, one of the points of the plan that I particularly love and the people were very impressed with in these focus groups was that nobody, not one household in this country, not one would ever pay one single dollar, not $1 to the federal government until that family, that household had taken care of its basic needs, food, shelter, clothing, transportation. Once the family had paid for all of this out of their income, then and only then would they start paying any taxes to the federal government. And one of the people in the focus group said, well, now that’s a fair tax.

And that’s how the name came around. Okay. So a consumption tax was proposed.

What kind of consumption tax? Well, a sales tax. How much would the sales tax be? And would you pay it along with the other taxes we’re paying now? Or would you eliminate some of those taxes or would you eliminate all of those taxes? Well, here’s your answer. Under the fair tax, all of your payroll taxes would be eliminated.

There would be no Medicare tax. There would be no social security tax. There would be no federal income tax withheld from your paycheck.

To make this very simple for you as an individual. Okay. Imagine this.

If you made a thousand dollars a week under your job. Yep. We’re going to hire you and we’re going to pay you a thousand dollars a week.

Well, how often do I get paid? You get paid every two weeks on Friday. You would know at that very moment, you would know that every other Friday, you would take home a check for $2,000. Yeah.

Now, okay. I know that some states out there have state income tax that they withhold from your paycheck, but guess what? If the fair tax is enacted on a national basis, your state is not going to still charge you a state income tax. They will convert for political survival.

They will convert to the fair tax on a state level because they will know that the same popular uprising that brought the fair tax on the national level is not going to tolerate an income tax on the local level. So you get paid a thousand dollars a week. You take home $2,000 every two weeks.

Very, very simple. And it is that simple. We’re going to continue with Neil Bortz after this break about ThePlainTruth.com. This is The Plain Truth Today that is brought to you by ThePlainTruth.com. The place to go to, to find out what’s going on in the world, in the economy, what God may have to do with it, what the Bible says is our future.

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And of course, we have the main page of The Plain Truth that gives you the latest of what’s going on that you need to know. That’s ThePlainTruth.com. Please go there every day. And we’re going to come back now to Neil Bortz on the fair tax.

And then I’ll wrap it all up at the end of this show and explain again why I think more people need to know and inform themselves about the fair tax. And I think if you did, you would promote it. And this country would boom like you haven’t seen it boom since before we had an income tax.

Payroll taxes are eliminated. The withholding for federal income taxes, Social Security taxes, the Medicare taxes, they’re gone because Social Security, Medicare, the cost of federal government, all is going to be funded by the fair tax. Guess what else is eliminated? All federal businesses and corporate income taxes.

Come on. I’ve already explained to you that corporations don’t pay federal income taxes, state either, for that matter. They collect those taxes from employees, from owners, and from customers and pass them on.

Well, let’s get rid of that stupid charade. We end all federal income taxes at the same time. OK? In fact, all federal taxes paid to the federal government, gone.

You know what that means? That means that these men sitting on a board of directors no longer do they have to worry about the tax consequences of some idea being proposed for their business or corporation, because there are no tax consequences. Do what is best for your business. Do what is best for your customers.

Do what is best for your employees. Do not worry about the tax consequences of your actions, because there are none. Do you realize what would happen in our business world if corporations and businesses could work to improve, to expand without worrying about the tax consequences if there was? You know, right now, right now the United States has the highest corporate tax rate in the world.

And we have what we call corporate inversions. These are American businesses and American corporations sending themselves off, surrendering to foreign ownership. Why? To avoid the onerous taxes in this country.

Well, imagine, imagine what happens if there are no taxes in this country. If there was no taxes, I’m going to interrupt again. If there was no taxes on businesses in this country, you would see so many American companies that went overseas.

Do you realize Google is headquartered in Ireland and so are other big American trillion dollar companies? They moved out of the United States to get a 10 percent income tax rate versus a 25 or 30 percent income tax rate. Many companies, Halliburton is another one, an oil company, moved to the United Arab Emirates. Many companies have moved out of the United States to avoid the very high business tax rate that they are forced to pay.

And people do not understand this. This goes into the cost of the products that you and I buy. We are paying those taxes.

But here’s the problem. If you’re an international business, like a Google or a Amazon, for example, that is moving a lot of its assets to Dubai, then you cannot compete because of our tax rate around the world against countries that don’t tax big businesses like we tax ours. And so if we did away with the corporate income tax for this fair tax, you would see hundreds, if not thousands, of major factories and businesses, manufacturing as well as other types of businesses, come to America from the countries they’re in.

Not American companies just coming back. Not just that. You would see maybe big companies like make like a BASF out of Germany or some company out of China that also has taxes, by the way, start thinking about maybe we should move to America because there is no corporate income tax.

And you would see this country boom like it’s never boomed before. Let’s finish up before the next commercial break with Neil Bortz. Give you an idea.

Businesses, corporations around the world in Europe, in Asia, in South America, in Africa, they would say, hey, you know what? If we relocate our headquarters, if we relocate to the United States, then there will be no tax consequences for our business decisions. There will be no taxes on capital and labor. There was many years ago, I would suggest that this was maybe six or seven years ago, a survey done of CFOs, chief financial officers of many foreign-based corporations, foreign-based, okay, headquartered overseas, Europe, Asia, elsewhere.

The fair tax was explained to them and they were asked the question, what would your future business plans look like if in the United States, there was no tax component on capital or labor? It was a business and corporate tax-free environment. I’m not sure what the exact ratio was, but about, I think, maybe 60% of these chief financial officers, they said, well, if possible, our next expansion would be into the United States. Our next research and development headquarters, our next manufacturing facility, it would be in the United States.

The remaining CFOs said, we would immediately start arguing to move our entire business and our headquarters to the United States. Okay, folks, think about that. What does that do for job prospects? Exactly.

What does that do for, Donald Trump campaigned on, he wanted to bring Americanmanufacturing back. What’s better to bring American manufacturing back than to have a tax-neutral policy for American manufacturers or foreign manufacturers moving to America, where they didn’t lose a quarter of their profits to pay a tax to a country that doesn’t do them any good. Basically, they’re robbing that company and its people who buy that product of goods and services that that country doesn’t deserve.

If we had a zero tax rate on businesses, then many manufacturers that are overseas in India, Asia, Europe, North Africa, a lot of those businesses would see a reason that they would want to come to the United States and make United States home for their manufacturing base. Because, believe it or not, and this is one of the things that I’m afraid too many people that are in unions and too many employees do not understand. It is not the cost of, there’s two things that you need to understand before we take this next commercial break.

Two things why companies move out of this country or do not move into this country. Number one is our high tax rate. Get rid of that high tax rate.

We would be competitive around the world and many world businesses would want to manufacture here because the American worker is the best worker in the world and everyone knows it. Toyotas made in America are better than Toyotas made in Japan. It’s always been the fact.

Number two and the other very important reason that people don’t want to come here is the damn regulations of the EPA, OSHA, and nonsensical government regulations. Those are the two reasons. I’ll be right back.

Hi, Bob Barney for theplaintruth.com. We offer, which we talk about all the time, a message board anybody can post on. Now, if you register, then you can post without your post being approved. You can post live and if something happens, you start posting like pornography, you’ll be taken off.

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That’s theplaintruth.com. Go there every day and we’re going to return back to the program in two seconds. Taxes come out, the price comes down, the sales tax, the fair tax is added to it.You’re essentially paying the same for those goods and services after the fair tax as you werebefore.

Capiche? And by the way, after Congressman John Linder and I wrote the original fair tax book, which I will remind you debuted number one on the New York Times bestseller list, among all books, number one. Well, after that, and we started seeing some of the arguments against the fair tax, okay? Some of the specious, weird arguments against the fair tax. John Linder and I wrote another book called fair tax, the truth answering the critics.

I believe that one came up number two on the bestseller list, but we addressed all of the objections to the fair tax in that book. Now, let me say this about criticisms of the fair tax. There is one common denominator to virtually all criticisms of the fair tax.

And that is this, the person criticizing the fair tax first rewrites the legislation, okay? They say, well, this isn’t going to work, so it’ll have to be changed to that. And then this won’t work, so it’ll have to be changed to that. And this is going to have to be when people buy this, it’s going to have to be exempt.

And when people buy that, it’s going to have to be exempt. And when you add up all theseexemptions and you change this and you change that, the fair tax just won’t work. Oh, the tax rate will have to be 60% or 50%.

They go in there, they take the most researched piece of legislation in the history of this country with over $20 million of research behind it. And then they say, well, I want to critique this, but I think what’s going on in their heads, I really can’t. So in order to criticize it, which is what I’m expected to do, I’m first going to have to change it.

I’m going to have to rewrite it. I’m going to have to change some of the provisions. And then I’ll critique it in the form to which I changed it.

Trust me, I’ve made a lot of speeches and I’ve conducted a lot of Q&A sessions on the fair tax. And the hardest objections to overcome are the objections made by people who first rewrite the legislation and then object to it on the basis of their rewrite. How the hell do you fight that? I mean, these people say, yeah, here’s this research or this legislation with $20 million of research, but I’m going to change this to that, and then I’m going to criticize it on the basis of that.

On what level does that make sense? Oh, and I should say this as well. There’s some guy out there, I’m not even going to dignify him by, he’s on Twitter, okay? And he says, I will pay Neil Bortz $50,000 if he produces just one page of actual research that was done on the fair tax. Look, you can go to fairtax.org and see thousands of pages of actual research that was done on the fair tax.

But this is the nature of the criticism of this legislation, that you get some guy out there who will say, I will pay $50,000 if Neil Bortz can come up with just one page. And then I respond, said, okay, pal, we will draw up an agreement. You will put $50,000 in escrow.

And the agreement will state that if I produce one page of actual research on the fair tax, then that $50,000 will be mine. And all of a sudden, Mr. Film Critic or whatever he is, all of a sudden he’s very quiet. No, he’s not going to pay $50,000 into an escrow account based upon a legally binding document that puts that money in my pocket if I come up with one page of research.

This is what we’re facing. This is what we’re facing with the fair tax. That’s what we’re facing with the fair tax.

And Neil Bortz is 100% right. And I hope that people that looked at this and listened to this for the last two days realizes that the fair tax is the way to go. It’s the only way to go.

And it’s the way that would actually save this country from the bad future we have coming ahead of us. And we do have a very terrible future with our overspending, our overtaxing, which has caused the American workers to not want to work and has caused our government to spend money they do not have. And it’s also forced us to go to countries that are our enemies and our potential enemies to borrow money in order to pay for things that we can’t afford.

Because our economy is now based on consumerism and not on manufacturing and production. And if we could get rid of the income tax, we would have motivated workers. We would have corporations coming to America in droves to do their manufacturing.

Because as I said in the beginning of this program, the American worker is a phenomenal worker. The American worker produces the better cars in America than the same company that is in Japan or in Germany can produce in their own nations. Everybody wants to use the American worker, but we are just too expensive of a country because of our regulations.

Do not forget these regulations have to go as well. And because of our income taxing on businesses. The one thing I hope you take away from this, not just that we need to go to a fair tax and get rid of the IRS and the income tax.

But the one thing I hope everybody takes away from this two day program is big business, little businesses, your business or at your neighborhood business down the street. They do not pay income taxes. You pay their income taxes and the cost of goods that you buy from them.

That’s the same simple plain truth. The plain truth of the day that you need to take away is the person who pays for corporate income taxes, business income taxes is you, the consumer. Well, this is Bob Barney for the Plain Truth today, brought to you by theplaintruth.com. And I really do hope that people take the time to research fairtax.org. I have nothing to do with it.

They do not give me money. I’m not sponsored by them. I don’t take money from anybody.

But it’s the one hope that this country has to become a manufacturing powerhouse again, like we were when we didn’t have income taxes. Income tax is the communist manifesto’s way to destroy this nation. And by the way, it’s done a very good job over the last 100 years.

This is Bob Barney for the Plain Truth today. Thank you for listening. Until tomorrow, bye-bye.