Reform America

It's gaining momentum all the time. If you're really interested, just go to the FairTax.org website, read up on it some more, and then e-mail, and write your Senators and your Representative telling them that you expect them to support the FairTax if they are to expect your vote in the next election. There are GrassRoots efforts all over the country that you can join, which also gets the attention of our elected employees.

I used to work in different Senator's offices and (especially when you are on the bottom of the totem pole) seeing these long petitions was the worst part of my day lol. I will say this though, when you send in some huge petition to an office like this, the first thing that will happen is everyone who signed it that is not from the state the office represents will get removed from the list, making petitions much less imposing and seemingly much less massive.
 
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I used to work in different Senator's offices and (especially when you are on the bottom of the totem pole) seeing these long petitions was the worst part of my day lol. I will say this though, when you send in some huge petition to an office like this, the first thing that will happen is everyone who signed it that is not from the state the office represents will get removed from the list, making petitions much less imposing and seemingly much less massive.

Thanks for pointing that out. I meant to, but obviously overlooked it, good catch. :D

The GrassRoots efforts (at least in my area) are broken down by Congressional Districts, and we each sign 3 separate petitions, so that the petitions can be directed to our individual Representatives, and then the State office gathers all of the ones for the Senators together, from all over the State, and forwards them on to our Senators, and just to make sure they don't forget us, we send them in EVERY MONTH.
 
I provided a link to the FairTax website, please take the time to study it... it answers all of your concerns.

You won't like my findings:

Those spending at twice the poverty level pay a FairTax of only 11.5 percent -- a rate much lower than the income and payroll tax burden they bear today. Meanwhile, the wealthy pay the 23 percent retail sales tax on their retail purchases.

The rich and the poor pay different percentages.... Not my idea of "Fair" and doesn't treat us equally.

Hence, the very wealthy will pay more taxes when the FairTax is enacted.

I thought the FairTax was supposed to eliminate class warfare? Still looks like its there to me.... just much softer than the IRS system.

there is no "getting out of paying it".

Under the FairTax Plan, poor people pay no net FairTax at all up to the poverty level!

Here it says some people don't pay any 'net' tax at all.... I guess they get a tax refund. Effectively meaning there are those who will get out of paying it.
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Now I mentioned that I didn't like "Progressive" systems, this is a progressive tax:
The prebate is the most equitable and most efficient way to make the FairTax progressive.

That suggests to me there is no limit to the tax... its on the "informed" public to keep the tax low - and to keep it from being shifted to the rich - by following their civic duty and keeping politicians in check.

The Federalist was primarily written by Hamilton, who was a monarchist, and is primarily responsible for the mess we're in today.

Ultimately, the tax rate will be dictated by the size of government. If government gets larger, higher tax rates will be required. If government shrinks relative to the economy, then the tax rate will fall. Federalist 21, by Alexander Hamilton, is a great read on the futility of government raising a consumption tax too high, and thus reducing revenues.

Oddly enough, they use Alexander Hamilton and the Federalist Papers to support the FairTax but Hamilton expresses the very same concern about the FairTax that I have.

...of course Congress can raise the FairTax rate just as it could raise the flat tax rate or can and does raise the income tax rate.

So what this will lead to is an ever increasing tax, with ever increasing "prebates" - for an ever increasing number of people so politicians can continue to pander - and the tax will be shifted primarily onto those in the upper classes.... Your site confirmed all my concerns as being accurate.

Therein lies the problem, it is an earnings tax, which was not any part of the FF's original plan. Earnings taxes are an impediment to work since the more you work, the more taxes you pay. It also fails to address the underground economy which could still thrive. The only way, IMHO, to deal with the situation, and get back to the FF's original plan, is to eliminate the IRS, and in it's place, install an income neutral system.

With my plan of a flat tax, everyone pays something like 10% of their income, rich, poor, white, black, everybody with an income and without exception. Thats true equality and fairness, there is zero bias in tax rate and the legislature would have to raise taxes on everyone, especially including the poor, to affect the rich... That system would eliminate class warfare.

The FairTax site mentions some drawbacks and flaws in a Flat Tax system:
The flat tax, however, retains the invasive income tax administration apparatus and can easily revert to a graduated, convoluted mess, as it has many times over many years.
Not mine. Mines no more complicated than the Fair Tax, 10%* is automatically withheld from your paycheck and/or earnings like the FICA tax currently is, and its much lower than FICA. I don't see this requiring anything more than a federal sales tax (FairTax) would require to administrate the funds.
a large part of the burden of the flat tax -- the business tax --
I was very specific, only flesh and blood VOTERS with income get taxed. This excludes all business from the tax.
Under a flat tax, individuals would still file an income tax return each year similar to today’s 1040 EZ.
Not under mine. No need for ANY filing - There ARE NO rebates, prebates or other forms of return, thus negating the purpose of filing.
Under the flat tax, the payroll tax would be retained and income tax withholding would still be with us.
Not under mine. All federal - not state or local - withholdings would now total 10% regardless of the persons income or wealth.
Its also worth pointing out that the FairTax aims to bring in at least as much money is currently brought in, thats some 3 trillion dollars.... I have no current way of means testing my flat tax but I expect it to fall far short of 3 trillion.
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I can see the definite benefits of the FairTax and agree that all the FlatTax proposals to date have been flawed. However, I believe I have built a better mousetrap in this regard.

Imagine this - My flat tax on the National level and your Fair Tax on the State level. Suddenly the states - NOT THE FEDERAL GOVERNMENT - would be awash in money, putting them in a much better position to flex their states rights. As it is now, the fed can basically blackmail states by withholding federal dollars until the state comes into compliance.

Shifting the power of money to the side of the state would also ensure that the federal government was ONLY involved in programs specifically enumerated by the constitution - as it couldn't afford much else.
 
You won't like my findings:

Well, let's take a look at them then.;)

The rich and the poor pay different percentages.... Not my idea of "Fair" and doesn't treat us equally.

I believe you jumped the gun there GS. What they are talking about is the differential related to the prebate.

"The FairTax is regressive and shifts the tax burden onto lower and middle income people"

The truth: The FairTax actually eliminates and reimburses all federal taxes for those below the poverty line. This is accomplished through the universal prebate and by eliminating the highly regressive FICA payroll tax. Today, low and moderate income Americans pay far more in FICA taxes than income taxes. Those spending at twice the poverty level pay a FairTax of only 11.5 percent -- a rate much lower than the income and payroll tax burden they bear today. Meanwhile, the wealthy pay the 23 percent retail sales tax on their retail purchases.

The universal prebate essentially pays the FairTax rate on the "basic necessities of life" for ALL Americans, regardless of income, everyone gets the same amount every month. This way, no American will be paying taxes on food, or other "basic necessities". Since those near or below the poverty line spend a substantially larger portion of their income on the "basic necessities of life" than on "luxuries", the universal prebate will virtually eliminate their taxes, while those in higher income brackets will continue to buy the "luxuries" that lower income families cannot avail themselves of, so of course they will be paying more in taxes, but they will NOT be paying taxes on the "basic necessities".

I thought the FairTax was supposed to eliminate class warfare? Still looks like its there to me.... just much softer than the IRS system.

Again, let's keep things in context shall we?

Consider, for example, your typical billionaire, of which America now has more than 400. These fortunate few are invested primarily in equities on which they pay taxes at a 15 percent rate, whether their income comes in the form of capital gains or dividends. In addition to having the income from their wealth taxed at a low rate, the principal of their wealth is completely untaxed either directly or indirectly. Assuming they and their heirs spend only the income earned on the wealth each year, the tax rate today is 15 percent. In contrast, under the FairTax, the effective tax rate is 23 percent. Hence, the very wealthy will pay more taxes when the FairTax is enacted. In a nutshell, those who spend more will pay more but low, moderate and middle income taxpayers will benefit from the greatest gains in reduced tax liabilities.

Let's consider the case of Warren Buffett, the third wealthiest man in America today. He himself went on a tear recently because the IRS tax code allows him to pay less, as a percentage, in taxes than his secretary and his cleaner! By his own admission, he was taxed at 17.7% on the $46 million he earned, while his secretary was taxed at 30% on the $60,000 she earned. All the FairTax does, by eliminating the IRS income tax collections arm, is to ensure that EVERYONE, regardless of income, is paying the same rate of taxes on their purchases. If everyone is paying the same percentage, where's the "class warfare"?


there is no "getting out of paying it".

Here it says some people don't pay any 'net' tax at all.... I guess they get a tax refund. Effectively meaning there are those who will get out of paying it.

I fear you're not fully understanding how the "prebate" works. EVERYONE gets it, the difference is that the poor spend the majority of their money on the basics, and since the "prebate" covers the cost of the taxes on the basics, the poor won't be paying any taxes, on the basics, which will free up that portion of their money to spend on "luxery" items, that WILL be taxed.
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Now I mentioned that I didn't like "Progressive" systems, this is a progressive tax:

Again, I fear you don't fully appreciate the way the "prebate" works. The only thing "progressive" about the FairTax is that the more you spend OVER the poverty line (that the prebate covers), the more you'll be paying in taxes, but that's all. The "prebate", for a family of 4 (parents and 2 children), works out to be about $537.00 a month, while a single person, with no children, would receive about $199 a month. The fact is that all the "prebate" does is cover the taxes for the "basic necessities" and nothing more.

That suggests to me there is no limit to the tax... its on the "informed" public to keep the tax low - and to keep it from being shifted to the rich - by following their civic duty and keeping politicians in check.

You're essentially correct, there isn't, but only because the rate is fixed, and the amont of taxes that anyone pays is directly proportional to the amount of purchases one makes.

The Federalist was primarily written by Hamilton, who was a monarchist, and is primarily responsible for the mess we're in today.



Oddly enough, they use Alexander Hamilton and the Federalist Papers to support the FairTax but Hamilton expresses the very same concern about the FairTax that I have.

Can Congress just simply raise the rate once the FairTax is passed into law?

Yes, of course Congress can raise the FairTax rate just as it could raise the flat tax rate or can and does raise the income tax rate. And if we in the grass roots allow them to do it, shame on us!

Again, context is everything. Firstly, Hamilton was a monarchist, but that doesn't mean he was stupid, and it doesn't aleviate him of the responsibility for the "tax and spend" mentality we have.

However, the FairTax is highly visible. And because there is only one tax rate, it will be very hard for Congress to adopt the typical divide-and-conquer, hide-and-disguise strategy employed today to ratchet up the burden gradually, by manipulating the income tax code. Ultimately, the tax rate will be dictated by the size of government. If government gets larger, higher tax rates will be required. If government shrinks relative to the economy, then the tax rate will fall. Federalist 21, by Alexander Hamilton, is a great read on the futility of government raising a consumption tax too high, and thus reducing revenues.

So what this will lead to is an ever increasing tax, with ever increasing "prebates" - for an ever increasing number of people so politicians can continue to pander - and the tax will be shifted primarily onto those in the upper classes.... Your site confirmed all my concerns as being accurate.

GS, there is no "shifting" of the tax burden. Even if they increase the rate of the "prebate", even the wealthiest Americans will get it, just like the poor will, so "pandering" isn't going to effect it. As far as confirming anything, I would suggest that you go back and study it again.

To be perfectly honest, anyone who comes out with a stance, either for or against the FairTax, after anything less than 2 weeks of serious study, simply hasn't given it enough thought and is jumping the gun (no insult intended). Even after it came out, it took hard core professional economists, from both sides of the aisle MONTHS to study it, and apply it to our current economy, and the majority of them support it. The only people I'm aware of who are against it are people like Bruce Bartlett and that nimnod Stephen Moore.

With my plan of a flat tax, everyone pays something like 10% of their income, rich, poor, white, black, everybody with an income and without exception. Thats true equality and fairness, there is zero bias in tax rate and the legislature would have to raise taxes on everyone, especially including the poor, to affect the rich... That system would eliminate class warfare.

I understand what you're driving at, but any flat rate income tax, is STILL an income tax. Perhaps I missed something, but I was under the impression that we were supposed to be working towards going back to an "original meaning" of the Constitution; Did I misunderstand? The Constitution, as written by the FF's specifically prohibited any type of tax that wasn't directly apportioned, and income taxes most certainly are NOT apportioned. The other thing that I oppose about any form of income tax is that it takes money out of the pockets of those least able to afford it, which is why I love the FairTax. Even to this day in my home state, they do not collect any taxes on unprepared food at the grocery store, because it is considered a sin to make people pay taxes on the most basic necessity of life. The FairTax, through the prebate, untaxes that necessity, your system still taxes it, before they can even go buy it. Maybe it's just me, because I did grow up poor, but dammit, when you have to watch your mother try to decide between paying the light bill or buying food because the goddamned government took her money before she could even buy food, that's FUBAR (f@ckedupbeyondallrecognition), and you don't forget it.
 
Let's consider the case of Warren Buffett, the third wealthiest man in America today. He himself went on a tear recently because the IRS tax code allows him to pay less, as a percentage, in taxes than his secretary and his cleaner! By his own admission, he was taxed at 17.7% on the $46 million he earned, while his secretary was taxed at 30% on the $60,000 she earned. All the FairTax does, by eliminating the IRS income tax collections arm, is to ensure that EVERYONE, regardless of income, is paying the same rate of taxes on their purchases. If everyone is paying the same percentage, where's the "class warfare"?


I am a bit confused since she falls in the 25% bracket. Something else is at work here.
 
I wanted to share a few ideas I had about reforming America. Please feel free to question or comment on what I have proposed or share your own list.

1. Balanced budget requirement

Just that, requires that the budget be correctly balanced annually under threat of removal from office. This extends right down the line of Government and its agencies. In the private sector, you cannot run a deficit every year and expect to keep your job.

2. Budgetary Spending and Tax Collection Restrictions

The Federal Budget cannot grow by more than 1.5% a year and can only grow as a result of budget surplus. To avoid being taxed into oblivion, taxes are capped by a flat tax that affects all persons in the United States at an equal rate and those federal withholdings cannot exceed 30% of income.

(Only actual people able to vote, with a source of income and guaranteed constitutional rights within our government are to be taxed by federal government. Foreign imports are the only inanimate's that face a one time federal tax at their point of entry. Transactions of goods and services between people, as well as property, within the United States are not taxed on a federal level. States would continue to have their own tax policies.)

No longer would there be federal taxes on businesses or industries headquartered and/or operating primarily in the United States.

3. Removal of Omnibus Bills

Unrelated legislation can no longer be lumped together for expediency or political childishness. Each ancillary bill or amendment must be Germain to the bill up for a vote. I.E. an Energy bill can contain only energy related amendments and so on.

4. Removal of all earmarks

Gone.

5. Sunset clauses become standard for all new legislation and retroactive for old legislation

Congress should spend far more of its time going over the piles of previously enacted legislation than writing and passing new laws. Laws must go through review to ensure they are meeting the purpose of their passage. These reviews must take place at least every decade, at most annually, and conclude with a vote to renew (with or without updates) or remove. This work is long overdue because reviewing old legislation, that other people wrote, doesn't get a politician camera time or votes for re-election.

6. Military Budget and War Tax

We disband the Military. Just kidding... The military budget is set to 25% of the Nat Budget during Peacetime and War. Nasa and the military work more closely together to prevent redundancy and waste in R&D of new technology.

If the military is forced to exceed its budget, like say for a real worldwide conflict, a 10% federal sales tax is an option for bringing in additional money.

Its important to note that this would be the ONLY federal sales tax and it would ONLY occur during times of war when our Military exceeds its 25% budget.

7. All Primary's take place one the same day

All voters primaries happen on Super Tuesday, one year prior to the presidential election. For people like me in states following the "primary" states, theres not much left to choose from when I get to vote. Every state is supposed to be equal in the eyes of government, thats the purpose of the Electoral College, so this would end the preferential treatment given to primary states during an election. We are all Americans and every state should be treated equally in this regard.

8. Provisions of War

In the event of war, should we ever occupy a foreign country through ground invasion (as is our case in Iraq and Afghanistan), Congress is obligated to operate at least one regular session a year inside the occupied foreign country until the conflict is resolved or the country is secured.

9. Inflationary Concerns

Americans are subject to the negative effects of inflation, so no longer is government going to be insulated from its effects. No system completely mitigates the fluctuating value of currency. Our fed does a decent job of keeping inflation in check, (Greenspan had much better results than Bernanke seems to achieve), but they have to work around the obstacles Government places in the way of private sector.

Having a budget thats tied into the economy and taxing every last working citizen equally, serve as serious incentive for politicians of ANY PARTY to see we are ALL doing well by their policies. (No more class warfare through taxes)

Uncle Sam will care a helluva lot more about keeping inflation in check when it affects his money too and not just ours. Insulating him from inflation, as we do now, has only compounded the budgetary problems we currently face.
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FedFarm, I would appreciate if you could let me know about the constitutionality of such proposals.

OK people, feel free to fire away at my suggestions and/or add your own! :)

I like all the suggestions (especially number 8). I would definitely vote in favor of trying all of these suggestions if we were both in Congress and you were introducing this as a bill. Although I ultimately favor a total repeal of any tax on income or earnings. I would rather repeal the income tax and just keep the excise taxes in place. It would supply sufficient revenue if government was limited to its true Constitutional measures.
 
Wel you cant deduction yourself up to the 30% bracket. She has to have other sources of income if she is getting taxed at this rate.

If she's married and has children, and her husband is using her and the children on his W-2, then she's not taking any deductions at all.

Besides all of that, the point is that Warren Buffett is taxed at 17.7% while his secretary is taxed at a substantially higher rate, and it's BS.
 
If she's married and has children, and her husband is using her and the children on his W-2, then she's not taking any deductions at all.

Besides all of that, the point is that Warren Buffett is taxed at 17.7% while his secretary is taxed at a substantially higher rate, and it's BS.

Who do you think has more impact on creating jobs with their tax savings? And if her husband is making money, its not the tax codes fault that she gets taxes if they file jointly since they both generate basically 1 income.
 
I fear you're not fully understanding how the "prebate" works. EVERYONE gets it....a family of 4 (parents and 2 children), works out to be about $537.00 a month, while a single person, with no children, would receive about $199 a month.

Government cuts everyone a monthly check... :(

... Sorry, but I see this turning into a huge entitlement program with the redistribution of wealth at its core.

Eliminate the prebates, make it a full blown "luxury tax", with exemptions that specify what "necessities" are, while keeping the tax at or below 15% and you got something I could sign onto... In fact I just wrote it, so I'll change my income tax to a sales tax that exempts necessities.
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I thought with all the people who wanted "Change", there would be no shortage of suggestions for government reform....
 
Government cuts everyone a monthly check... :(

... Sorry, but I see this turning into a huge entitlement program with the redistribution of wealth at its core.

Gen, it's a PREBATE. All they're doing is untaxing the basic necessities of life in a way that makes it easier on the business owners! Think about it this way, in my home state, when you go to the grocery store, the store owner has to pay somebody boucoups bucks to program the scanners to NOT charge tax on unprepared food items, and that cost is passed along to the consumer.

Under the FairTax, the store owners no longer have to do that, so the SAVINGS are passed along to the consumer. Their calculations also untax gasoline, basic clothing, and all of the other "basic necessities of life" so that NOBODY is being taxed merely for LIVING. Now, would you rather have the Federal government, you know, the same ones who can't really seem to decide of we need to be drilling off of our own coasts, or in ANWAR, decide exactly what the "basic necessities of life" are, and have to provide a specific list to the owners of every business in America, so that they don't tax those specific items, or isn't it a hell of a lot smarter to simply tell all the business's what the inclusive tax rate is going to be, and simply send a prebate check to every LEGAL American to compensate for the taxes, and let the Americans decide what specific "basic necessities" they want to spend their money on? No, if you have to produce a list of things that are not to be taxed, all you're doing is creating a new bureaucracy (that's going to cost billions to run) that will replace one of the ones that the FairTax eliminates.

That's the other great thing about the prebate, only LEGAL AMERICAN CITIZENS get the check, illegals don't, so they're finally going to be paying their fair share of taxes (that they're not paying now) when they come here to work (illegally), and spend their money in our stores, instead of being able to skirt around it by working strictly for cash, under the table, and not paying any taxes at all.
 
Who do you think has more impact on creating jobs with their tax savings? And if her husband is making money, its not the tax codes fault that she gets taxes if they file jointly since they both generate basically 1 income.

It's not the tax codes fault? The tax code is the single biggest impediment to job creation in America today. Study the history of the tax code and you'll see what happens when the government is allowed to extort as much money from We The People as they want to, regardless of the fact that the vast majority of the money they're STEALING from us is spent on totally un-constitutional things.

It costs me a bundle every year to have my accountant do my taxes, on top of the cost of matching Social Security, etc., etc., etc., and any accountant worth his salt will readily tell you that they absolutely HATE doing income taxes, corporate taxes, or any other taxes for that matter, and would much rather do what accountants are supposed to be doing, making sure that their clients businesses are profitable.

The FairTax eliminates the federal income tax altogether, and replaces it with a simple consumption tax, so that everyone, regardless of income, decides how much they want to give the government by way of their taxes, based strictly upon what they decide they want to spend their money on. It gets the governments guns out of our ribs, and jack booted thugs off of our throats, and places the power right back where the FF's envisioned it to be, with We The People.
 
Gen, it's a PREBATE.
By any other name, its still a check from the government.
It beats the IRS but thats not saying much... Who likes the IRS?
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Going back to Reforms...
What kind of reforms can be made for how we prosecute wars?

I was thinking about gold as well... Does anyone know how much gold is in America and if we import or export more per year?

What would happen if America "cornered the market" and began stockpiling such a commodity? We already have a gold reserve I know, the Public just hasn't seen the gold in 40 years... Would there be any serious implications or drawbacks to converting currency to gold? Of course, inflation of the dollar and a gold bubble would combine to come out a net plus if we traded dollars for gold while inflation was increasing and sold gold once inflation stabilized to deflate the gold bubble. Just thinking out loud, jump in...
 
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By any other name, its still a check from the government.
It beats the IRS but thats not saying much... Who likes the IRS?

Nobody likes the IRS. I believe, and I could be mistaken, that you're still confusing the prebate with some form of "welfare". When you get a refund check from the IRS when you file your taxes (if you do, myself, I always end up paying, but that's a rant for another thread), do you consider that to be "welfare"? The difference between a "refund" check, and the "prebate" check is all in when you get it. If it'll make you feel any better, look at it this way, with the FairTax, the first "prebate" check you get will be a "stimulus check" like most people got this year, and every check after that is a refund check (like you currently get once a year, only now, you'll be getting it every month) for all the taxes you overpaid.
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Going back to Reforms...
What kind of reforms can be made for how we prosecute wars?

Lacking a Constitutional Amendment where by Congress would be REQUIRED to make a formal declaration of war, I don't have the answer. Also, it would be necessary to ensure that none of our treaties allowed for any intervention in the affairs of a foreign nation. The problem with most of this is that, other than purely national defense, most of our wars have been about ensuring our access to free and unfettered international trade, whether by preemptively stopping a threat to that trade, or by engaging once the threat has manifested itself.

I was thinking about gold as well... Does anyone know how much gold is in America and if we import or export more per year?

What would happen if America "cornered the market" and began stockpiling such a commodity? We already have a gold reserve I know, the Public just hasn't seen the gold in 40 years... Would there be any serious implications or drawbacks to converting currency to gold? Of course, inflation of the dollar and a gold bubble would combine to come out a net plus if we traded dollars for gold while inflation was increasing and sold gold once inflation stabilized to deflate the gold bubble. Just thinking out loud, jump in...

As I mentioned elsewhere, attaching our economy to any tangible assert in this day and age is extremely dangerous. Looking at your gold example, assume for a moment that we are able to corner the world market on currently available gold; what happens if 2 years from now Luxembourg suddenly discovers the largest gold deposits ever discovered right under their own feet, and they start producing those deposits and flood the market? Our economy could tank over night, and unless we invade Luxembourg and seize their mines, there's nothing we can do about it.

No, at this point, having our economy tied to our own productivity as a nation is the only way to ensure the long term stability of our economy. There's also the fact that there's so little gold in the entire world, that at the current exchange rate, it doesn't equal 2 years of our budget, much less the rest of the world, which would require a total revaluation of the entire worlds net worth! That alone would not only wreck the worlds economies, but would probably lead to massive wars from the fallout.
 
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