Quote:
Originally Posted by Damien
Aren't taxes set at state level in America? I know Sales Tax is....
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There are oodles of Federal taxes in the US. The Union would collapse if there weren't; it's the only reason a state like California can remain in an effective currency union with Iowa. Federal taxation and spending allows fiscal transfer from the places where the money is made to the places where it isn't.
http://en.wikipedia.org/wiki/Taxatio..._United_States
See also:
http://www.economist.com/blogs/daily...s-fiscal-union for a brief but informative piece on the sheer scale of fiscal transfer between rich and poor parts of the USA.
The fact that the successful US Dollar zone relies on a TAX-RAISING GOVERNMENT OF THE UNION should not be overlooked.