Perry E. Metzger <perry@imsi.com> writes:
Not that I wanted to get in to this, but Mike was begging for it.
If I told you that I could save you tens of thousands of dollars a year just by using some simple to use software, would you do it? Well, if you had some simple to use software system that allowed you to escape from the above ground economy, you could personally save tens of thousands a year.
I am not convinced such software exists, that most major businesses would offer to interface with it, or that it would of necessity be "simple" or "easy to use". Once standards are created for commerce over the Net and the collection of the VAT, you are pretty much locked into using them if you wish to do business with any vendor of significant size.
What makes you think the VAT will be small?
Bear in mind we are talking about a Utopian society of the future with a downsized government. Trying to support the current level of wasteful government spending from a VAT would send people fleeing for the borders.
What makes you think it will be inconvenient? I know of two pizza places in Manhattan where they very likely don't pay taxes and where you can also buy drugs.
I know of some places on the Internet where I can chat with people using a version of Unix talk which encrypts. But if I want to talk to some random person, I am probably stuck with using the default version which does not. I have little hope of convincing people to make the encrypted one a standard, in spite of the fact that all they would have to do is spend a few minutes to FTP it. Encrypting everytime I use "talk" is therefore somewhat inconvenient. A complete escape from the above-ground economy in a society heavily dependent on electronic transactions would be even more so. Again, you are free to try, but most people probably won't bother.
The underground economy in the U.S. is huge -- enormous, in fact. Most of us interact with it every day without even realizing it. As a small example, the clothing manufacture industry in New York survives on illegal factories running almost entirely underground. Ever tip a waiter in cash? Ever pay for a haircut in cash? Ever make a purchase from a Mom & Pop grocery in cash?
The size of the underground economy is largely a function of the repressive and outrageous monetary and tax system we have in this country. When families can barely make ends meet with all the adults working multiple full-time jobs, there is an enormous incentive to shave costs. In a society where taxes were managable, and put to a use all citizens felt was worthy, such forces would be much less and there would be enormous peer pressure on individual citizens to do their fair share. Kind of like the days when income tax was two percent and functioned on the honor system. Just decriminalizing drug use and the sex industry would get rid of a very large chunk of the underground economy.
Tim will likely pay his broker to churn his account in Switzerland and do just as well. He'll have a credit card from a bank in the Bahamas. He'll probably do just fine watching HBO and Showtime, too.
The majority of US citizens who use local financial services and get their cable TV through a wire from the street will generate all the revenue we need. We could even give Tim a guaranteed annual income. -- Mike Duvos $ PGP 2.6 Public Key available $ mpd@netcom.com $ via Finger. $