If there is one thing certain, it’s that Obama’s record setting budget deficits can not continue indefinitely without serious consequences.  Eventually one of two things will happen – either correcting the ship of recklessness or facing the consequences of a Zimbabwe like hyperinflation and social unrest.  If Senator Conrad has his way, then we may just attempt to plug the flood of red ink with a new nationwide VAT tax.

From the LA Times:

At a White House conference this year on the government’s budget problems, a roomful of tax experts pleaded with Treasury Secretary Timothy F. Geithner to consider a VAT. A recent flurry of books and papers on the subject is attracting genuine, if furtive, interest in Congress. And last month, after wrestling with the White House over the massive deficits projected under Obama’s policies, the chairman of the Senate Budget Committee declared that a VAT should be part of the debate.

“There is a growing awareness of the need for fundamental tax reform,” Sen. Kent Conrad (D-N.D.) said. “I think a VAT and a high-end income tax have got to be on the table.”

A VAT is a tax on the transfer of goods and services that ultimately is borne by the consumer. Highly visible, it would increase the cost of just about everything, including a carton of eggs and a visit with a lawyer. It is also hugely regressive, falling heavily on the poor. But VAT advocates say those negatives could be offset by using the proceeds to pay for healthcare for every American — a tangible benefit that would be highly valuable to low-income families.