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Compliance isn't just a technical burden. It is a threat of legal liability. The bill allows state tax audits by any state against any online vendor.
On May 6, 2013, the Senate passed the Marketplace Fairness Act (MFA). If this legislation passes the House, it will require Internet-based businesses to collect state sales tax based on the shipping address for qualifying states. A state can qualify by simplifying its sales tax and providing software to the public to compute the tax.
Buying exclusively within a specific geographic region impoverishes the local economy, whereas purchasing foreign-made goods helps lift the world's poor out of poverty. Some people suggest that protecting an infant industry with tariffs is a special exception.
Perhaps we would be economically better off with global trade, it is argued, but we have an obligation to maintain a high moral standard. We insist on a minimum wage for our workers. We have high safety standards and humane working conditions. We should not reward countries that exploit their own people. These arguments, although emotionally moving, actually hurt the truly needy.
President Obama's understanding of financial planning is fundamentally flawed. In his latest budget, the chief executive proposed a cap on tax-preferred retirement accounts. An individual's total balance could not accumulate over $3 million. This total would include the sum balances of a traditional IRA, Roth IRA, 401(k) and defined contribution plans.
America will continue to lose jobs where we don't have a comparative advantage and gain jobs where we do. This change should be welcome.
Imagine that five years ago, you could put your money either with a bank in Cyprus or America. After those five years, the bank in Cyprus will confiscate 10% of your money with a onetime tax. Where would be the more favorable place to deposit your savings?
Voluntary trade benefits both sides, even in the global economy and even when benefit is distributed unequally. Worrying about a trade deficit, or a trade surplus, is largely useless. Countries with trade surpluses benefit from trade because they use the unspent foreign currency to invest in their prosperous trading partner. Countries with trade deficits benefit from how cheaply they've bought foreign goods.
Average Americans think about trade imbalances the wrong way. They get upset when America imports more than it exports. They want to put tariffs on foreign goods and encourage consumers to "buy American," but they have it exactly backward.
Free trade is beneficial, but first you must understand that "Voluntary trade benefits both sides." Anyone who has taken a basic macroeconomics course has listened to, repeated and written this maxim dozens of times. Yet many people simply don't believe it. They admit it can theoretically have its benefits, but believe in practice it is riddled with negative consequences, especially for America. Let's examine their four chief complaints.