VAT Still on the Table?

President Obama hasn't given up hope of massively increasing taxes on Americans.

President Barack Obama suggested Wednesday that a new value-added tax on Americans is still on the table, seeming to show more openness to the idea than his aides have expressed in recent days.

Before deciding what revenue options are best for dealing with the deficit and the economy, Obama said in an interview with CNBC, "I want to get a better picture of what our options are."

After Obama adviser Paul Volcker recently raised the prospect of a value-added tax, or VAT, the Senate voted 85-13 last week for a nonbinding "sense of the Senate" resolution that calls the such a tax "a massive tax increase that will cripple families on fixed income and only further push back America's economic recovery."

For days, White House spokesmen have said the president has not proposed and is not considering a VAT."

Any VAT would likely start out with a 15% to 20% rate (sure, it might initially start as a lower rate, but eventually we'd see it get up to 15% to 20% just like every other over-taxed Western country).

Even though the imposition of a VAT isn't that likely (Congress can't be that stupid, can they?!), smaller government advocates should not fear the national debate that likely will be forthcoming.

That debate will be an opportunity to highlight the stark difference between the politicians looking to tax Americans to death, and those who advocate for a much smaller central government.