The central bank’s GDPNow tracker of incoming metrics is indicating that gross domestic product is on pace to shrink by 1.5%.

  • @arotrios
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    2 days ago

    i actually disagree here, for a couple of different reasons. First, the sales tax is a regressive tax on the poor, and it will directly help lower income communities while positively changing their buying habits.

    Second, reducing the tariff impact directly increases overall economic activity. For instance, that Canadian lumber is still going to be taxed when it’s sold as a dresser made by an Washington woodworker - it just means that the woodworker isn’t paying as much of a tariff to bring the raw materials into the country. This means that overall sales tax revenue goes up because its less expensive to do business.

    Third, in terms of specifics (on primarily a West Coast basis) regarding potential lost revenue, California’s loss could be offset by repealing Prop 13 - we have very low property taxes as a result of this Reagan era law, and bringing it more in line with real property values could bring in billions from our wealthiest (and we have a lot of wealthy landowners in CA). Washington (to my knowledge) doesn’t have property tax - bringing on one could similarly offset the revenue loss. Oregon, conversely, doesn’t have sales tax, so in their case it might be more an issue of funding state rebates for allied countries - for instance, a reduction on property taxes for new homes built with allied country sourced materials.

    All this being said, the real solution to the government revenue program for social programs in the face of a lawless fascist federal government is for the blue states to start collecting federal income tax directly from their citizens, paying for the programs themselves, and then providing the remainder to the federal government if they’ve been meeting their duty under the Constitution. However, this step would be the prelude to real civil war, so it’s likely a bridge too far for our current political leaders on the left.