Trouble brewing - Boston Herald article on Kerry and the VAT tax

This is trouble. It looks like the BH has in its subtitle and text spun Kerry's comments that do not say he is in favor to suggest he is.

Reading just Kerry's quotes, he is speaking of the need for major reform of the tax code and - in a different comment - says that everything should be on the table. What is not given is the question he was responding to.

Here are the direct Kerry quotes:
"“The tax code remains too long, too complicated and too chock full of wasteful subsidies and giveaways that don’t make economic sense,” Kerry said in a statement.

“A big reform is overdue. We should simplify. You should look at and consider everything that would take some of the burden off of working people. We should definitely debate alternatives like the VAT, but the test of any idea should be fairness, progressivity and economic growth.”

Now anyone who took Econ101 knows that the VAT if applied to everything is regressive. It has long been proposed by the right as an alternative to the progressive income tax for that reason. Taking just the last two sentences that Kerry is quoted as saying suggests that VAT is not the answer. It will put more burden on working people and it is not progressive.

The Herald does say he "stopped short of endorsing a value-added tax." In fact, he was substantially less positive given those two last sentences. Then they say "But he made clear it should be on the table." In fact, he said EVERYTHING should be on the table. In addition, in the subtitle they go further and get into going WAY beyond Kerry's quotes- "As deficits grow, Kerry says European-style fees may be fair" Nowhere does Kerry say that.

http://www.bostonherald.com/business/general/view.bg?articleid=1245809

The same thing was done to Paul Volcker - whose comment that it was "less toxic" was spun into the media to say that he was for it. The WH has distanced themselves from that. This constant rightwing twisting any complex complicated thoughtful comments into political cheap shots.

luxury items.

This is not something I would favor, because it is regressive, but it is also true that it goes with very different structures of taxes, including a lower taxation of lower income. If anything, it is not less regressive than the flat income tax MA has.

a flat income tax. On the federal level, it would likely not be as progressive as the current income tax, which is progressive enough that a large percent of people do not have to pay. It would be far more progressive than the SS and Medicare taxes.

Thank you for pointing out what the European tax really is. It is hard to get more progressive than a graduated income tax which obviously becomes more progressive as it becomes steeper. Letting the Bush tax cuts expire, though it would raise almost everyone's taxes, would make it more progressive. If the Congress does nothing, I think that happens. The Democrats have to be smart enough to use that eventuality to put the pressure on Republicans instead of Democrats to pass something to avoid that. (Better than having to negotiate with Lincoln on the estate tax.)

I do think that Kerry is right that the tax reform is needed and I think the measures he says he will use are good. (He and Baucus did a good thing in passing measures to make hiding assets offshore harder.)

Thanks also for looking at this more rationally and less emotionally than I did. :)

And my first thought was: yep, that's the Herald, putting "European" in there with "tax" to get the no-necks slavering and drooling. I thank both of you for a good discussion on this so far!

Setting the Record Straight: Letter to the Editor of the Boston Herald



John Kerry wrote the following letter to the editor of the Boston Herald, setting the record straight on his position on a Value Added Tax:

I was surprised to see today's article completely distort and misrepresent my position on a value added tax. With a projected deficit of over $1.3 trillion for 2010, we need changes in fiscal policy and that's why I supported creation of a bipartisan task force which would make recommendations on spending and revenues. In order for this task force to be successful, all options should be on the table. Everything should be debated. Our income tax system has become complicated. Working people resent paying taxes while big corporations and the connected avoid taxes and stash money away in Cayman Island bank accounts. Any tax reform should make the tax code simpler, fairer, more progressive, and reward work. That debate hasn't even begun, but I don't support adding a Value Added Tax on top of today's income tax system, and Congress isn't considering that! Let's get real.

http://kerry.senate.gov/cfm/record.cfm?id=323713

Makes you wonder if the distortion was intentional.

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said - but I assume few read either the comments or the whole article. Kerry's comments are actually not really spinable without taking parts of a sentence.

Would a Murdoch paper intentionally lie?

Bravo, Senator Kerry.