A conservative news and views blog.

Location: St. Louis, Missouri, United States

Thursday, December 22, 2005

The Economic Broom of History

Eastern Europe is being swept clean of the last bits of socialist debris by the broom of a flat tax. Across the former Warsaw Pact, countries are adopting this with spectacular results. According to a Washington Post article;

Russia, for instance, enjoys the benefits of the 13 percent flat tax it adopted in 2001. The tax quickly yielded positive results. Revenue poured into government coffers as tax evasion and avoidance became much less profitable. Inflation-adjusted personal income tax revenue has more than doubled since the flat tax was implemented.

But Russia was simply learning from its neighbors. Estonia was the first, adopting a 26 percent flat rate in 1994. Latvia and Lithuania followed in the mid-1990s, with 25 percent and 33 percent rates, respectively. Serbia was next; in 2003 it went with a 14 percent rate. Last year, it was Slovakia (19 percent) and Ukraine (13 percent). This year it's been Romania (16 percent) and Georgia, which boasts the lowest rate -- 12 percent.

Poland, Croatia, Hungary, the Czech Republic, and Bulgaria are all considering adopting a flat tax.

I posted this piece about the matter back in September, and now the mainstream media is starting to catch on to the economic miracles which have been following the inauguration of a flat tax.

That it has been so hard to understand that cutting tax rates and reducing paperwork and regulation would kickstart the economy is a testament to the economic ignorance and superstition of the Modern Era. Socialism has been the preferred economic model until the 1990`s worldwide, and liberals in this country have worshipped at the alter of John Maynerd Keynes since Roosevelt. The heavy, progressive income tax has been the engine for governmental growth, and the Democratic coalition was firmly rooted in that tax. They derived money to buy votes by taxing everyone-but especially those who produce in our society. Anyone who has read Atlas Shrugged knows the frustrations of those who carry the burdens of society, and who are vilified for their efforts.

A flat tax removes this onerous burden on the producers, making a more fair and equable system. Of Course the economy grows! Furthermore, by defunding the welfare state, those who have suckled on the prodigious mammary of the government find it more attractive to become one of the producers. It`s a win-win situation, except for the Democrats, the media, and those who make their way by keeping people poor and stupid (Jesse, where are you?)

The flat tax is sweeping up the liberal/socialist droppings in Eastern Europe. Here in the land of freedom and plenty, we are still playing with a tax system devised by Karl Marx. Isn`t it time we got on board, and adopted a flat tax?

(Hat Tip; Icarus Fallen-Thanks Mattias!)

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