The Wall Street Journal
VATs always start small and get bigger.
Candor about taxes is rare in Washington so when House Speaker Nancy Pelosi admits that Democrats may have to impose a huge new tax on the middle class to fund their spending ambitions believe her.
Speaking with PBSs Charlie Rose on Monday Mrs. Pelosi mused publicly about the rising possibility of enacting a value-added tax or VAT as part of broader tax reform.
Somewhere along the way a value-added tax plays into this she said.
Of course we want to take down the health-care cost thats one part of it. But in the scheme of things I think its fair to look at a value-added tax as well said Pelosi.
The allure of a VAT for politicians is that it applies to every level of production or service rakes in piles of money and is largely hidden from those who ultimately pay itnamely consumers.
With a $9 trillion 10-year budget deficit $4 trillion in spending in fiscal 2010 alone and a $1 trillion (at a minimum) health-care entitlement in the wings
Mrs. Pelosi knows that not even the revenue from the expiration of the lower Bush tax rates in 2011 will cover the bills.
Nearly every European country that has passed national health care has also eventually imposed a VAT and its foolish to think the U.S. will be different.
Mrs. Pelosi is the second prominent Democrat to call for a VAT in recent weeks. John Podesta an adviser to President Obama and president of the very liberal
Center for American Progress called in September for a small and more progressive VAT.
Mrs. Pelosi and Mr. Podesta argue a new tax is necessary to address the nations exploding financial liabilities as if those liabilities exploded on their own.
Of course VATs always start small and get bigger.
The bills for the Democratic spending blowout are coming due even sooner than advertised and the middle class will pay whatever Mr. Obamas campaign promises.
