Oneida Ltd• For years, Revere shipped copper

coils about 20 miles to another manufacturing company named

Oneida Ltd.

• Oneida cut and formed the copper

• Then plated silver on the form to produce...

…a silver bowl designed by Paul Revere

That’s as American as apple pie? Right?

WRONG…

…ON TWO COUNTS!

The Paul Revere silver bowl

• Now made in China

• Today, Oneida buys the silver bowl, silver flatware and other products from China

• How can China produce that silver bowl over there and ship it over here and compete?

The American Apple Pie• America now imports apples from

China

• So you really can’t say “…as American as apple pie…”

• How can apples from over there be refrigerated, shipped and still compete with apples grown just down the road?

It’s the cheap labor, right?

WRONG

First, let’s first look at the benefits

of producing that silver bowl

in

China vs. USA

…as China manipulates its currency…

The Paul Revere Silver Bowl

Assume production cost of 元 100

if made in China

@ manipulated exchange rate of 元 7 to $1, the production cost

in China is $14.28

@ free market exchange rate of 元 4 to $1, the production cost

in China would be $25.00

China’s currency was

undervalued by an estimated

40% back in July 2005

Exchange rate valuation

Based on the differences of trade balances

and international economic growth,

that 40% should have grown about 5% points

more a year since July 2005

Recent Press Release:

China has adjusted

its currency by 15%

since July 2005

BUT…

China’s exchange rate for its yuan should have been appreciating

by 5% points more each year since July 05 or 12.5%

So the “adjustment” by the government of China of 15% really nets to only

2.5%

Yuan still overvalued about 40%

Currency manipulation

works the same way

for apples grown in China…

In other words, the government of China manipulates its currency to

subsidize the cost of manufacturing and farming

in China

It’s not only currency

• Tax structure • Health care • Environmental Stewardship• Government loans not repaid• Piracy of intellectual property/ reverse engineering• Other Subsidies

Currency manipulation on top of

these subsidies can reduce costs as much as 80%

when producing in China

This happens without even considering

the cost of labor

That’s how China competes…

…AND THAT’S AS CHINESE AS APPLE

PIE !

But it is more than China…

• The USA has a trade deficit with virtually every other major trading nation in virtually every class of goods…

• Because the USA became the worst place outside of the Middle East or Africa to locate a factory or a farm…

What made the USA the worst place to locate a factory or a farm?

• The USA is the only nation that has a tax system biased against domestic jobs

• The USA is the only nation that has a health system biased against domestic jobs

Wait A Minute!!!

• I just saw a report that the USA just “leapfrogged” to become the third cheapest country in which to do business due to the “plunging” dollar

• Mexico and Canada cheaper

• China excluded from survey

Do we want a weak dollar or a strong dollar?

We want a naturally strong dollar - Trade balance is good

- Makes imports cheaper - Foreign travel is less expensive

- Sign of a strong economy

Artificially Strong Dollar

• Something is fundamentally out of balance

• Internal problems with competitiveness of USA production of goods & services

• External problems with manipulated currencies in Asia and other protectionist practices by foreign nations

So we can change what is fundamentally wrong

or

we can just let our economy and our currency and our future

deteriorate

USA tax system is a tax on domestic jobs

• All income, payroll, savings, property, investment & inheritance taxes are taxes on jobs

• The products produced must carry these costs

• Unless, of course, the products are produced in another country

• As a result, production of farm, manufactured and service goods are moving to countries that support domestic jobs with taxes for jobs

Furthermore

How can a US producer compete

if it must carry the burden

of the health care costs of its workers

and its foreign competitor does not?

Revere’s fabricating costs• In 2007, about 10% of Revere’s

fabricating costs were for the health care of its people and their families

• If you buy a product made from Revere copper or brass, you are paying for the health care costs of our people

• If you are buying a foreign product, you are not paying for any US producer’s health care

What about Revere’s exports?• Of course, the cost includes the health care

costs of Revere people

• The foreign country’s border adjustable tax imposed on Revere’s exports helps pay for the national health care cost of that nation

• So, in order to compete, Revere people have to cover their own health care cost and those of the foreign workers they compete against!!!

• That’s just as true for farm products whether you are considering taxes or health care…

What makes a tax system biased for jobs?

In order to answer this question, it is necessary to understand

Border Adjustable Taxes

All major foreign countries have them

The USA does not

Border Adjusted Taxes

• Value Added Tax (VAT) is most common

• World average is 18%

• World Trade Organization (WTO) compliant

• Rate & application depends on country (making some compliant & some not so…)

Let’s say a good produced in the USA

costs $10 to produce and ship

to a foreign border

Then let’s assume it costs

another $10 to get to a consumer

Assume $10 to produce in the USA and ship to a foreign border

Then another $10 to get to a consumer

COUNTRY

VAT RATE

FRANCE

@19.6%

CHINA

@17%

VAT APPLIED @ BORDER 0 $1.70

VAT APPLIED @ CONSUMER $1.96 $1.70

TOTAL VAT

CHARGED $1.96 $3.40

A Fair Question

Is the VAT Tax of China

really a National Sales Tax?

Border Adjusted Taxes

VAT (Value Added Tax)

- also rebated for exports

- usually does not tax full value ($10)

- VAT wars

Border Adjusted Taxes

• VAT (Value Added Tax)

- rebated for exports

- usually does not tax full value ($10)

- VAT wars

• National Sales Tax

- not applied to exports

- applies to full value of imports ($20)

- WTO compliant and simple

Impact of a National Sales Tax on the supply chain for a US consumer

• A National Sales Tax will place a tax burden on the entire supply chain

• That means all foreign made components or products will be fully taxed

• Just as if they would be if produced in the USA

• Foreign made treated the same as US made

Border Adjusted Taxes

• VAT (Value Added Tax) - rebated for exports - usually does not tax full value ($10) - VAT wars

• National Sales Tax - not applied to exports - applies to full value of imports ($20) - WTO compliant & simple - regressive

• Fair Tax - a National Sales tax that replaces all Federal Taxes - not regressive (it’s fair)

Make it not regressive

• Prebate

• National Health Care

- offsets regressive nature of sales tax

- lifts burden off US production costs

So how do we compete?

• Need to offset currency manipulation

• Need a border adjustable tax

• Need a national health care system

BUT REMEMBER, THIS IS A COMPETITION!!!

Look at Best Practices

Nations need to behave like corporations and sports teams

that continually look at the best practices

of whomever they are competing against plus add a new wrinkle...

(like a Fair Tax)

So we need to determine the best practices

for our products to compete in a global

environment…

• Zero tolerance of currency manipulation

• Elimination of all taxes on jobs - income taxes (corporate & private) - payroll taxes

- taxes on investment and savings • Fair consumption tax (w/health care)

Best Practices

Objection from Farmer Brown“I don’t like a sales tax that adds to the

price that people have to pay for my goods!”

“Farmer Brown, do you like a system that taxes your goods but not imported goods?

“No!”

“Well, Farmer Brown, that is what you have now!!!”

Taxes, Taxes, Taxes

Tax his land, Tax his bed, Tax the table At which he's fed.

Tax his tractor, Tax his mule, Teach him taxes Are the rule.

Tax his cow, Tax his goat, Tax his pants, Tax his coat.

Tax his ties, Tax his shirt, Tax his work, Tax his dirt.

Tax his tobacco, Tax his drink, Tax him if he Tries to think.

Tax his cigars, Tax his beers, If he cries, then Tax his tears.

Tax his car, Tax his gas, Find other ways To tax his ass

Tax all he has Then let him know That you won't be done Till he has no dough.

When he screams and hollers, Then tax him some more, Tax him till He's good and sore.

Then tax his coffin, Tax his grave, Tax the sod in Which he's laid.

Put these words upon his tomb, "Taxes drove me to my doom..."

When he's gone, Do not relax, It’s time to apply The inheritance tax.

Accounts Receivable Tax Building Permit Tax CDL license Tax Cigarette Tax Corporate Income Tax Dog License Tax Federal Income Tax Federal Unemployment Tax (FUTA) Fishing License Tax Food License Tax, Fuel permit tax

Gasoline Tax Hospital Assistance TaxHunting License Tax Inheritance Tax Interest expense Inventory tax IRS Interest + Penalties(tax on top of tax)

Liquor Tax Luxury Taxes Marriage License Tax Medicare Tax Property Tax

Real Estate Tax Service charge taxes Social Security Tax Road usage taxes Sales Tax Recreational Vehicle Tax School Tax State Income Tax State Unemployment Tax (SUTA) Telephone federal excise tax

Telephone federal universal service fee taxTelephone federal/state/local surcharge taxes Telephone minimum usage surcharge taxTelephone recurring/non-recurring charges tax

Telephone state and local tax Telephone usage charge tax Utility Taxes Vehicle License Registration Tax Vehicle Sales Tax Watercraft registration Tax Well Permit Tax Workers Compensation Tax

This list does not include corporate taxes such as taxes

on IncomePayroll

Health care or

health care costs which act like a tax on producing

goods and services in the USA

Virtually all taxes are a burden on domestic jobs in

Agriculture,Manufacturing

and Service industries

Only one

is a tax on goods

that are imported

That is theState Sales Tax

which treatsgoods produced

in foreign countriesthe same as

goods producedin the USA

That means a sales tax

is a

tax for (domestic) jobs

So if we want to keep jobs here

we must replace all Federal

&

many other State Taxes

with a Fair Tax

which will tax imports

the same as

goods produced in the USA

A Fair Tax

for

Fair Trade

Visit: Fairtax.org

Research papers

- impact on manufacturing & agriculture

- fairness

- numerous other questions

Best Practices

• Zero tolerance of currency manipulation• Elimination of all taxes on jobs

- income taxes (corporate & private) - all payroll taxes

- all taxes on investment and savings

• Fair consumption tax (prebate)• National health care plan financed by fair

tax• Rules (enforced) based trading

Worst Practices for Global Warming

• The world is working to make carbon emission worse

• The Kyoto Treaty and Regional/National Greenhouse Gas Initiatives exclude China

• They drive manufacturing to countries that have lower environmental standards

• Causing carbon emissions to increase

China’s Pollution Flow

Almost 25% of the particulate matter that falls on California originates from China and Southeast Asia.

Policy making• The international trade & tax policies of the

USA are destroying the best jobs in the USA

• The correct policies are not protectionist but balanced and recognize the degree to which trade is managed by every country in the world but the USA

• National & international environmental policy making is contributing to global warming due to its biased impact on international trade and the relocation of production capacity

We need to Change

This will require an alliance of

farm, factory, service

and national security

representatives

WWW.PROSPEROUSAMERICA.ORG

Wake up, America!

Visit: reverecopper.com and learn more

Please carry the message…

Thank You.