The FairTax

Have you heard of the FairTax? It’s a tax system that is being proposed in congress that would replace the federal income tax and payroll taxes, including gift, estate, capital gains, Social Security/Medicare, and corporate taxes. The FairTax is based on a national retail sales tax. So the more items your buy, the more you are taxed. I’ve stated a few of the main points of the FairTax below:

- Americans take home 100% of their paychecks
- No federal sales tax up to poverty level
- Monthly rebate to account for necessities
- No tax on used goods. Amount paid to fund government is totally visible.
- Retail prices wouldn’t hide corporate taxes or their compliance costs
- The income tax exports our jobs, rather than our products
- The FairTax is revenue neutrality: Neither raise nor lower taxes so consumer costs remain stable


More detailed information on these topics can be found at http://www.fairtaxvolunteer.org/smart/FairTaxFAQ.pdf or for a more general view of the tax system, go to http://fairtax.org/.

I think the FairTax system would be great. The tax system as it stands now is large and cumbersome. I find this topic very interesting and would like to hear people’s opinions. Would it work? Could we see more jobs come back to the US? How would the political scene change if this system were used?

Birds May Travel, but Will You?

The bird flu has been discussed in the news for several months now. Both the World Health Organization and the Center for Disease Control in Atlanta say that traveling to countries that are known to be infected with the bird flu disease in both humans and poultry, will not be restricted at this point in time.
It has been said that the Avian Flu will arrive in North America sometime this year, 2006. This will result in a pandemic where scientists have mentioned an estimated 30% of the population will become infected and very ill. As you know, health care in America is already a mess and for all we know it will be up to us to help ourselves when this flu strikes.
When it comes to travel, for business or pleasure, people have the choice to fly and/or take a cruise, but because of this new bird flu scare, will people all over the world stop traveling? Think about the Caribbean Islands, villagers thrive off of tourism. If they do choose to stop traveling due to the fear of becoming infected by this flu, will economies deplete, sending airlines and cruise lines out of business? How about Disney World, the main tourist attraction in America, will it run out of business?

New York Women See 2 Sides of Prescription-Free Morning-After Pill

According to the New York Times, the morning - after pill or Plan B has now become available to buy it at any pharmacy without a prescription for women 18 and older. Making this pill simple to get has some women breathing a little easier, while other are worried that this might increase sexual behavior. Women now have the choice of taking a pill that can lower the risk of pregnancy by up to 89 percent. Plan B does not protect against sexually transmitted diseases or HIV. Barr Pharmaceutical Company has said it hopes to begin nonprescription sales of Plan B by the end of the year. The pills will be sold only from behind the counter at pharmacies, but not at convenience stores or gas stations. There isn't enough scientific evidence that young teens can safely use Plan B without a doctor's supervision, but Barr did prove that over-the-counter use is safe for older teens and adults. The morning after pill has been available by prescription since 1999 with many people having to pay around $300 for a visit to their local doctor in order to get the drug. Now the Barr Pharmaceutical Company, the maker of Plan B, has made the pill available to women at $20 to $40 a pack. Is it in a woman’s self interest to take the pill? Are there more unintended effects of taking the pill than just the possibility in the amount of sexual activity?

Schering-Plough to Pay $435 Million in Probe

Forbes.com reported today that pharmaceutical giant Schering-Plough, the maker of Claritin agreed to pay $435 million (talk about sunk costs!) and plead guilty to conspiracy to settle a federal investigation. The corporation has been charged with overcharging Medicaid for drugs as well as marketing them for unapproved uses.

Previously, Schering-Plough paid $346 million to settle charges that it paid bribed an insurance company in order to protect the market for its product, Claritin. Other charges and allegations that the company has been faced with include:

· 2 separate accounts of selling different cancer-fighting drugs for uses which had not been approved by the FDA.
· The sales department determining which doctors received grants to run continuing medical education programs (presumably based on which physicians used their products).
· Providing false data to the government’s Health Care Finance Association about the price of Claritin Redi Tabs © to secure that HMO’s business, as well as attempting to supply them with free drugs.

Part of the settlement includes a stipulation that the company adds a section to their corporate integrity agreement with the Office of the Inspector General of the U.S. Department of Health and Human Services, which will require Schering-Plough to monitor their marketing and drug pricing in the future, as well as make amends for their past manipulations.

Incidentally, Schering-Plough has 32,000 employees worldwide and makes approximately 9.5 Billion dollars annually. After the settlement was made known, their stock rose 41 cents (2 percent) on the New York Stock Exchange.

Should the government be allowed to interfere to this degree in a free market economy, if the general public is not aware of a corporation’s abuse of its position? Would this be possible in a laissez-faire system? Are the penalties they impose even effective, if a corporation is as wealthy as this one? What if the cancer fighting drugs really do save lives- does the FDA have the right to deny patients’ a chance to survive? Does this take away individual choice? And, perhaps most importantly, is it coincidence that after being charged with a lawsuit, the companies stock prices jumped? What does this say about the American economy?

English Only Town: A Good Idea?

I was doing homework while listening to the news last week when something caught my attention. A New Jersey town is considering making the town an English only town (English would be town's official language). The question of YES or NO will be put to voters come election time in November. The mayor seems to be in full support of the idea saying it would "unify the town." If this is passed it would require all businesses to conduct all business in English unless otherwise required by State of Federal Law.

This could have several repercussions, but one concern is the definite economic trouble it could cause the city. If part of the population does not speak/read English, then they will either relocate, or at least take their business elsewhere. Either way, it could cause economic problems for the city. What do you think the best course of action is? Would you vote yes or no?

fuel costs weigh on consumers

Gas prices are still on the rise and home values are decreasing, so should it be any surprise that our economy is in a slump? With the gas prices taking such a high toll people are focusing more on necessities and are spending less on impulse buys. Applebee’s is even suffering from the gas prices because people are less willing to spend money on dining out and are opting for the less expensive meals at McDonald’s. The purchases of many expensive items are being avoided like new cars, vacations, and even remodeling the house. Many Americans are changing there complete lifestyles from the route they took to work to weekend plans . It is difficult for Americans to have to make such difficult tradeoffs between things they want and things they need.The slump says a lot when even Wal-mart is seeing a decline in profits.
How much longer are we going to be in a slump? What other unintended consequences will arise due to high gas prices?

America's Drunkest Cities

Forbes.com reports on the "drunkeness" rankings of 35 metropolitan areas within the United States. Rankings were based on state laws, number of drinkers, number of heavy drinkers, number of binge drinkers, and the extent of alcoholism.

The top five cities are:

1. Milwaukee
2. Minneapolis-St. Paul
3. Columbus, OH
4. Boston
5. Austin, TX

Hmmm...is this something that Milwaukee can be proud of? (Should Columbus be worried that it is only ranked #3? After all, Columbus has a reputation to uphold now that OSU's football team is the preseason #1 ranked team in country.)

How much weight do you give to such rankings? Take a look at the methodology behind the rankings and suggest an alternative system if you're not satisfied with the approach of Forbes.com.

Thanks to Division of Labour for the tip.

Waiting for Starbucks

Since Hurricane Katrina, New Orleans has been in the dumps, literally. Businesses are slowly moving in, even though many of the people who lived there before, have all moved back in. Because of this, many people wonder if they will have the jobs to support their families. According to CNN.com "Waiting for Starbucks", in order to deal with this problem, the city is allowing the local businesses to open first, and the national businesses later. Starbucks for instance, only has two of their four stores open, and Popeyes has sixteen of their thirty-six stores open. With the exception of Wal-Mart, which has eight of its ten stores open, many nation-wide companies have not moved back in. Cooperate America is afraid to move back in because they fear a lack of employees and also consumers. Lack of housing and cost of housing has caused more problems in staffing because many people cannot afford to move back in, in order to take their old jobs back. Plans to sell four of the five city hospitals have been broughten up because the city cannot afford to keep them all. Because of the shortage of workers and worker housing, the number of jobs in education and health is down 42%. Jobs in hospitality are down by 35% and in trade and transportation, down 28%. Yet, with all these jobs “open”, many relocated New Orleanians are still in search for jobs. In fact, one out of every four is unemployed. But, the national companies are doing their best to help. Wal-Mart tracked down every evacuated employee and their family members to tell them they could have a job at any Wal-Mart they could get to. Popeyes has gone to such lengths as to ask FEMA for trailers as a way of housing families, so they could have housing and a job. FEMA said they could only give them to teenagers, not their employees. Robert Pollin, an economist at the University of Massachusetts Political Economy Research Institute, says to tell employers to buy their own trailors in order to house the families, and then submit the bills. James Boyce, one of Pollin's UMass colleagues, agrees: "The record shows that business will respond if asked to do something that makes sense, is within its sphere of competence, and isn't financially suicidal. There's a lot of good will in this country's business sector, but it needs to be called on."

What do you think? Should local businesses buy their own trailers in order to house their employers? Do you think it would be worth it? Should the State, or FEMA for that matter, be more willing to help?

...Will that be smoking or non-smoking?

A brouhaha recently occurred in Ohio as part of the political tactics involved in the anti-smoking campaign to ban smoking from all indoor public places in the state. The group SmokeFreeOhio is pushing for a November ballot issue that would increase regulations on second-hand smoke exposure by banning all indoor smoking in public places within Ohio. Meanwhile, SmokeLessOhio is pushing an alternative ballot issue that would also limit indoor smoking but would allow some exceptions such as bars and restaurants.

Over in Europe, Scotland implemented the more stringent version of the smoking ban back in March of this year and the early evidence suggests that pub owners are now feeling the pain. According to an industry group, drink sales are down 10% since the ban. Pubs also report fewer visitors and reduced meal sales. Some even claim they could go out of business if business stays flat.

This raises an interesting tradeoff from society's point-of-view: what price are we (society) willing to pay for increased health? Are we willing to sacrifice bar and restaurant jobs for increased health? How many jobs? How much better health?