ANSWERING A FAIR TAX QUESTION

During yesterday's show a caller asked what would happen to her 401K funds if the Fair Tax bill became law.  No income taxes had ever been paid on that money residing in her 401K.  If, by the time she starts drawing that money out, the income tax is history, will she have to pay some sort of penalty? One month ago I would have rattled off the answer.  No.  No penalty.  No taxes.  You take the money and run.  Yesterday, however, I was a bit more cautious.  I've spent many hours over the past weeks studying the history of the income tax, the history of withholding, and various schemes for tax reform including, of course, the Fair Tax.  I wanted my answer to be dead-on accurate, so I deferred until I could dive into the bill.

OK.  Now I've done the research, and here's your answer: You take the money and run.  No taxes.  If you are sitting fat and pretty with a 401K plan or other deferred income plan when the Fair Tax hits you will be able to withdraw the cash with no penalty and no tax consequences.  Not such a bad deal, huh?

I've been collecting questions about and objections to the fair tax.  It is amazing how many people don't like the idea because they don't think that the rich will be paying enough in taxes.  It doesn't matter that paying taxes will be voluntary under the Fair Tax plan.  It doesn't matter that nobody pays the retail sales tax on the basic necessities of life. It doesn't matter that lower income Americans will virtually get a free ride when their entire federal tax liability disappears, including Social Security and Medicare taxes.    What does matter?  Some people are afraid the evil, hated rich won't pay enough.  How dare these people work hard, make good decisions, and save all that money?  How dare they achieve that much more than I have?  Make 'em pay!

The Fair Tax can overcome a lot of things.  I don't know how it can overcome the angry jealousy so many Americans feel toward those who achieved more than they?

BUSH SAYS NO TO TAX HIKE

Good news out of Washington regarding reform of Social Security.  For the past few weeks, a number of plans have been advanced to "save" Social Security.  One of the most popular seemed to be that proposed by South Carolina Senator Lindsey Graham.  Under his plan, the $2 trillion in transition costs to a partially private system would be paid for by raising taxes on the rich.  Oh isn't that always the way to go!  Raise taxes on the rich!  From each according to their ability!!!

Yesterday, President Bush shot that down. He said the forthcoming bankruptcy of the program had to be addressed, and that  payroll taxes would not be increased as part of that plan.  Good.  As with any other government program, the last thing we need to do is confiscate more money from the public.  The problem with Social Security is a spending problem.

At least younger workers will get to put aside 2 to 4% of their earnings in a private account, which is more money than they would see out of the Social Security rat hole when they retire.

RUMSFELD SET UP

You know that supposedly courageous soldier being hailed in the media for taking on Defense Secretary Donald Rumsfeld at that question and answer session in Kuwait?  Turns out he was planted there by a reporter.  So after all of these reports about the disgruntled rank-and-file "grilling" Rumsfeld, the whole thing turned out to be a sham.  Figures.

Apparently the perpetrator in all of this is one Edward Lee Pitts, reporter for the Chattanooga Times Free Press.  Knowing that there would be a Q & A with Rumsfeld and that the press would not be allowed to ask questions, he decided to hatch his own plan to embarrass the secretary.  He found some gullible troops and the plot was hatched.

As Pitts himself tells the story in an e-mail leaked to the Drudge Report:

"I was told yesterday that only soldiers could ask questions so I brought two of them along with me as my escorts. Before hand we worked on questions to ask Rumsfeld about the appalling lack of armor their vehicles going into combat have. While waiting for the VIP, I went and found the Sgt. in charge of the microphone for the question and answer session and made sure he knew to get my guys out of the crowd."

So there you have it.  Will the media fully retract their original stories, based on the fact that it did not take place the way it was originally described?  Of course not.

WHAT A DISASTER

The Federal Censorship Commission is set to begin discussions at its December 15th meeting over whether to allow cell phone use during commercial flights.  That's right, private cell phones would be allowed to be used in-flight.  So what's the problem?

Can you imagine sitting next to someone for a 6-hour flight who was flapping their gums non-stop on their cell phone?  This is like cell phones being allowed in movie theaters.  Everyone would be on the phone, and nobody would be able to hear themselves think.  Here's your solution.  If the jerk next to you starts yammering on his cell phone ... pull out a magazine and start reading aloud. When he stops talking, you stop reading aloud.  He'll get the message. 

I would go for the cell phones if they would get all screaming babies off airplanes and no children in first class.

BOORTZ RSS FEED

Many of you have discovered that the Nuze now has an RSS feed. Here's the feed link which also lives permanently on the page as the  XML button below. Don't know what the heck that is? Then here is a nice explanation of what it is, what it does, and why you might want to use it. 

READING ASSIGNMENTS

You need to read this screed from race pimp Jesse Jackson. This washed-up race warlord is comparing the election in Ohio to what's going on in the Ukraine.  Someone needs to tell Jesse that there are very few people out there other than his personal dog washers and media leftists who care even a little bit what he has to say.  Remember .. this is the jerk who tried to tell us that the Taliban wanted him to come over to Afghanistan and negotiate after 9/11.

Peggy Noonan must have tapped into my deepest inner thoughts.  Here is what she recently wrote about Hillary Clinton: What I concluded was that Mrs. Clinton was an unusually cynical leftist political operative who had no great respect for the citizens of the United States or for America itself, but who saw our country as a platform for her core ambitions: to rise and achieve historic personal and political power both with her husband and without him.  Now .. you have to read the rest of her column.  Read it and save it.  Every single minute of every single day Hillary is on the campaign trail for the 2008 Democratic nomination.

Remember that U.S. Marine that disappeared from his unit, showed up as a "hostage" in Iraq and was beheaded...then not beheaded?  He's being charged with staging his own kidnapping.  Nice going.

Looks like some moderate Democrats were all ready to call for booting Kofi Annan....until they flip-flopped.

President Bush is making some personnel changes to his administration.  If he were a Democrat, it wouldn't make any news.  But since he's a Republican, it's a power grab.

Howard Dean wants to run the Democratic party like he ran his campaign for president.  Please let him get that job....after all, the Republicans could use a filibuster-proof majority in the Senate.

The enduring lesson of the 2004 election cycle is that the elites lost their control on the process, and the people rose up.  Dick Morris explains in his analysis.

Why is the UN the way it is?  Max Boot has an idea, and he says it starts with the fawning media and lack of oversight.

Democrats aren't the only ones who could use a few new ideas.  Civil rights leaders need to take a few good looks in the mirror as well, writes Stanley Crouch.

As Martha Stewart sits in a jail cell, Larry Kudlow says she deserves a second chance, and that she just made a mistake.  Judging by the announcement of her new television show, it doesn't look like she'll be hurting too badly.

The media largely ignored it, but people shouldn't forget the miracle that has occurred in Afghanistan with the inauguration of  Hamid Karzai.  Charles Krauthammer has more.

Schools think they're teaching children "ethics," but as Thomas Sowell writes, what they really lack is good moral teachings.

George Bush has replaced more than half of his entire cabinet, but the left still can't stand that Donald Rumsfeld is still on the job.  Rich Lowry takes a look at the Rummy haters.

The Boortz gallery has been updated with pictures from this year's live broadcast from Texas A&M.

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