Slump Update - New Year's Resolutions

Well, it's been over two months since I quit my job and started on a path to a new life. Not much has changed in those two months. I've learned to bake some. I played and beat a few Wii games with my wife. I read large tomes of American History and Government and can recite the Presidents and Constitutional Amendments from memory... But that's pretty much it! No job prospects, no self-evident future, no nothing.

I didn't even take the FSO Exam in December like I planned because at the time I had only read American History frontwards and not backwards, and did not feel confident. The next exam date is March. Meanwhile, I have registered to three more courses at NYU in their Global Affairs continuing education program. The first ones start on February 6. Until then I hope to have completed my FSO exam registration package. I am also going to volunteer with the FIRST Robotics Competition program at Thomas Jefferson High School in East New York - well, the school is now broken into like 5 different high schools, but whatever... The program starts this weekend and the regional competition happens during the first weekend of April.

Well, that's it on the personal note. But I have a word I'd like to say about the FAIR tax, since today is the Iowa Caucus and Mike Huckabee is in the lead in some polls and he is a big proponent of the tax. My first assumption when dealing with this is that we all agree we want a progressive tax - rich people pay a bigger percentage of the tax burden as a percentage of their assets (be it earnings, capital gains, rents, grease, or passive appreciation of property) than poorer people, and the poorest should not be taxed at all. I am not a communist, or even a socialist. I do not believe in special entitlements for the poor or punishment of the rich. I just think this is fair. Now if you don't agree with me on this, don't bother reading further. Anyways, the question is whether the FAIR tax is progressive. The idea is that everyone will get some kind of a minimum refund for the tax burden they would have to incur with the blanket %23-30 sales tax. This refund will make the poor come out even (no tax burden); richer people - who supposedly consume more - will come out negative with some tax burden on a linear relationship with how much they consume. The idea is that the richer you are the more you consume and the more tax burden you will have, hence his is a progressive tax. However, rich people consume smaller percentages of their assets than poorer people. That is, if I were in the middle class bracket and earned $75k a year, I probably would consume %50-90 of these earnings. If I were further up the ladder and making $175k a year, I could probably consume only %40-60 of my earnings and so my tax burden as a percentage would be lower on average than my poorer counterpart. This is not progressive. If you think Bill Gates and Warren Buffett spend more than half their assets and earnings on consumption, then wow, where do they put all their stuff?

Besides being a regressive tax, the FAIR tax also seems to be a consumption dampening force. Since the tax is applied at the till, market forces would probably lead to a higher savings rate - I say probably because we Americans seem to have consumption in our blood, and I'm not talking tuberculosis. A higher savings rate is probably a good thing in a macroeconomic and long-term perspective since it will eventually lead to a decrease in our current account deficit. But in the short term it could also send the economy further in its current downward spiral. This is not a good time to introduce such a tax into our economic system. During a peak, maybe, will help the cooling process. But during a near-recession? Come on, this is a silly populist platform from a guy who besides this crazy tax would revoke your right to choose to have a safe and sensible abortion, and take away your right to hope to marry whomever you choose, but protect the rights of psychos to get a lethal weapon whenever they so please. Iowa, if you want to do your nation proud with your crazy first primary/caucus, do the right thing and say no to Huckabee and yes to someone who really does want to protect your right to the pursuit of happiness, like Ron Paul. Or at least someone not so crazy, like Rudy.