i think it's because they were misdesigned and because, for partisan reasons ark lot of people talked themselves into believing that tax credits, which were essential the same thing as government spending, were somehow or another different and it was ok to have tax credits and not have tax rate reductions, and they just talked themselves into believing that whatever the white house wanted was good for the economy and it was just all, you know, i'd say -- i'd use the b.s. word if we weren't on tv. host: one for email. pat writes in, isn't a v.a.t. a tax on manufacturing? didn't it also make more sense in the 1970's when we had a much larger manufacturing sector? guest: no, it's a tax on sales, on consumption. and ideally, you'd want it to be as broad as possible to include services as well as manufactured. one of the virtues of a v.a.t. is that it applies equally to imports and is rebated at the border on exports. so actually, it gives you a benefit in terms of international trade. so it's really a very good tax from a narrow technical point of view, and i really think that the people

and i think it's because they were misdesigned and for partisan reasons people talked themselfs into believing that tax credits, the same thing as government spending, where are somehow or other different and it was okay to have tax credits and not have tax rate reductions, and they just talked themselves into believing that whatever the white house wanted was good for the economy, and it was just all -- you know, i'd say --d but we're on tv. >> one more e-mail for you. >> guest: it's a tax on sales, on consumption, and ideally you want it to be as broad as possible to include services as well as manufacturing. one of the virtues of the v.a. t. it applies equally to imports and was rebated at the border on exports. so, actually, it gives you a benefit in terms of international trade. so, it's really a very good tax from a narrow technical point of view, and the people who oppose it are just dogmatic and don't know what they're talk about in most cases. >> host: one more call. st. louis good morning to william. >> caller: first off, fine it hard to believe that most people say that ta