>You don't want to try a giant experiment like this whole-hog
>and find out that it drives more of the transaction of goods
>and (especially) services underground, crippling the federal
>tax base. Any field data out there?

As opposed to the huge underground economy we have now with day labor, off shore accounts and the several hundred other ways to hide income. I know what my wife's boss keeps off the books because he's paid in cash, and I expect that alot of other businesses do the same. I just think the positives far outweigh the negatives, at the worst we would be trading one underground economy for another, but we would have the following benefits:

I would like to think the Fair-tax does three very important things. First it makes us more efficient as a country. It eliminates having to pay to have our taxes done which would free up millions if not billions of dollars. It also shrinks the size of the IRS making the government a little cheaper to run. The second facet is that it makes politicians actually have to think when they make policy. No longer can they just give tax breaks, some actual policy planning has to be done, hopefully it will spur creative solution to some of the problems out there. Which leads to the third and most important facet is it allows us to be more competitive on a global scale. No longer will there be tax breaks to take jobs out of the country, and if I remember correctly, there will be no tax imposed on products sold outside the country**. This will make our products about 20% cheaper to produce than before. No longer will be running a trade defecit, instead we will have a trade surplus.


Dave Krenz

**You may want to double check this I know most of the general ideas behind it, I just haven't dug into all the specifics.