ANDE Q&A:

Q: Every citizen gets the Dividend? Wouldn't taxes be less if the Dividend was paid only to people who were needy?
A: Every citizen gets the Dividend from the Rockefellers to the man in the tin foil hat. Polarization between the rich and poor has torn whole civilizations apart. A universal Dividend removes resentment between the classes, helps out the working middle class, assures that there's an economic advantage to working, saves the poor and avoids accusations that we're paying people not to work. The Dividend is a citizen's right, like voting.

Q: Do children get the Dividend?
A: I don't think we want to pay people for having children. (Although if the working tax base implodes in a few years, as some are predicting, we may want to.) But for now I think we'll want to look at annual payments to minors set aside in an interest bearing account and available for college, investment or starting a business when they become adults.

Q: What parts of the Welfare system does the Dividend replace?
A: Straw Man guessing says all of it. Social Security recipients might be offered the chance to choose between the Dividend and their Social Security check. Most would choose the Dividend, since most would make more money.

Q: What part of the Federal Income Tax does the ANDE proposal eliminate?
A: All of it. Also, existing corporate/business taxes are replaced by the business sales tax. (See item (4) in the ANDE diagram)

Q: Isn't this approach inflationary?
A: Because the dividend is modest, citizens seek extra income through paid employment, investment and business endeavors. However, since the dividend will reduce people's demand for employment somewhat, wages are likely to increase to attract employees. To avoid inflation, additional anti-inflationary pressures will be needed. These can include high Federal Reserve rates, tax benefits for anti-inflationary wage and price practices by business, Government policies that reward and facilitate price competition, and other similar approaches. Also, with the Dividend in hand, a look needs to be taken at the hourly wage concept itself. What would the inflation impact be if hourly wages were largely replaced (in whole or part) by profit sharing and/or employee investment programs?

Q: If business has to pay taxes, won't they just pass the cost along to consumers in the form of higher prices? They're not going to reduce their profit margins to pay taxes.

A: Successful business will always pass along all their costs to their customers, including taxes and their profit margin. Remember that the ANDE proposal is designed to address social needs. Our society needs to feel that everyone is pulling their fair share of the weight, especially Business.

Q: What about the rich and tax progressivity? Do they  pull their fair share?

A: If they live like rich people, they will pay enourmous quantities of taxes.  If they live like the rest of us, they pay taxes like the rest of us and leave their millions in the bank to strengthen business as loans, thereby creating jobs.  The luxury tax (see #6 in the diagram) is where actual, unavoidable progressivity is found.

Q: What about tax breaks for charitable organizations?
A: Reduction or elimination of the sales tax for charitable organizations could be legislated within this model.

Q: Why should the poor pay any sales taxes at all?
A: Everybody should pull their weight. It's right, and it avoids polarizing, destructive resentment. What the poor need is to not be poor. ANDE provides that.

Q: What about health care, education and other needs?
A: An important feature of this proposal is tax transparency. If the nation wants all or part of health, college or others costs to come from the Government, they can get it, and the national sales tax rate will increase "in broad daylight" to cover the cost of the new programs.

Q: Will the Dividend always stay at the same level?
A: The size of the dividend should grow annually as the GNP grows. Increased spending money means increased tax revenues, permitting increased levels of Government services without having to raise the tax rate. This is the way to permanent free-market economic growth.

Q: When will the Straw Man figures be optimized?
A: After extensive academic study and analysis of the ANDE proposal.