A (false) underlying assumption among those who support proposals like the NST is that everybody spends everything. While this may be true from a the multi-generational perspective, it is certainly not true in the short run. There has been for some time now a huge and growing financial management industry that encourages individuals to SAVE SAVE SAVE (for retirement, for vacations, for future generations, etc.) Perhaps surprisingly, many do, despite what you read about the overall savings rate in the news sources. Result = a great many people and families have at least some savings. Moreover, in addition to "cash" (much of which is accumulated from after-tax dollars), most people have at least some equity in their house and while some of this is unrealized cap gains, some of it is equity from the prin portion of the mortgage payment. Like your cash nest egg (IRA's and 401k's excepted), the prin you pay is paid with after-tax dollars. (The current deflation of home valuations is an anomaly and probably temporary. A great many people have equity in their home despite the current real estate market.) To be fair (and the NST is often called "The Fair Tax") all prior savings and equity accumulated from after-tax dollars would have to be exempted from the NST. Otherwise savers face completely un-fair double-taxation. The NST proponents need to think about this and offer some realistic suggestions as to how to manage a potentially long and complex transition from after-tax savings to an NST, especially since they want to abolish the IRS and reduce govt bureaucracy and oversight. Otherwise, Huckabee-like proposals severly punish savers by changing the tax rules (dare we accuse him of advocating a huge tax increase on savers?) .

I am sure Landsburg knows all this but chooses to ignore it for the sake of his argument.