The Unfair Tax?

Dave Hornstein writes this opinion at examiner.com:

There is a proposal to replace the federal income tax with a national sales tax, dubbed by its proponents the "fair tax," a label that is not only dishonest but downright Orwellian. The British writer George Orwell, a man of uncompromising intellectual honesty, saw clearly that in politics something can be given a name that is the exact opposite of the reality

To call a national sales tax a "fair tax" is certainly Orwellian when sales taxes are highly regressive.  The less income a person makes, the higher percentage of it they have to spend.  With spending being taxed, the lower one's income, the higher the percentage of it that goes to taxes.

The fairest basis for taxation is ability to pay, which is based on income.  As a person spends a lower percentage of their income as they make more money, a graduated income tax is the fairest of all, for people at higher income levels have more money available to pay taxes.

What do you think of Hornstein's argument?  Use economic language and analysis in your explanation.  Is "ability-to-pay" the only criteria for determining the fairness of a tax?  How could a national sales tax be made more fair?  How might a national sales tax be considered "efficient"?  

Cap and Trade Debate

CHARLESTON, W.Va. (AP) - A global warming skeptic and a leading climate change expert  are going to debate the potential impact of cap and trade legislation on West Virginia's economy. Cato Institute Senior Fellow Patrick Michaels and Climate Change Director David Hawkins at the National Resources Defense Council will face off Dec. 7 at the University of Charleston.

Under legislation passed by the U.S. House and now under consideration in the Senate, the federal government would set limits on carbon dioxide emissions. Businesses would then buy and sell permits to emit the gases.

Michaels says the proposal would lead to job losses in mining, trucking, railroad and other industries.

Hawkins says it would provide opportunities for economic growth.

Explain one specific way cap-and-trade legislation may lead to job losses in mining, trucking, railroad or other related industries.  You don't have to talk about all of these -- just one specific way in one of them.  Then explain one specific way cap-and-trade legislation would provide an opportunity for economic growth.  You may not repeat what your classmates have already written; you must come up with a new idea.

Global Public Goods

The Zedillo Commission Report on World Bank Reform wants to "create the foundation for far-reaching reform of the World Bank as the premier global financial institution supporting sustainable global development and poverty reduction."  Among other things, it identifies the provision of "global public goods" as one of the three main challenges facing the World Bank:

Supporting the provision of global public goods: The report identifies global public goods, such as environmental protection, response to epidemics, protection of global financial stability, etc., as an important challenge, but does not specify what role the World Bank should play and what reforms are needed for it to play this role. In terms of funding, it will be important to explore making the World Bank the principal conduit for global public goods funding.

Talk about public goods.  How might this idea extend to "global public goods"?  Explain one other global public good not mentioned in the article, and why you think it is a global public good.  Why might it be important for the World Bank to become "the principal conduit for global public goods funding"?