GST, home and abroad

It seems that GST increases are all the international rage these days, with remarkably similar debates.

In Canada:

[P]ersuading Canadian progressives of [the] merits [of the GST] is a never-ending variation on the theme of "but these go to eleven:"

Progressive Person: How do we raise the tax revenues we need for the social programs we want to implement without tanking the economy?
Economist: Consumption taxes. Theory says that consumption taxes such as the GST are the least-disruptive way of generating tax revenue, and available evidence appears to be consistent with the theory.
PP: But consumption taxes are regressive!
E: Yes, but we can correct for that using targeted transfers to low-income households so that they aren't worse off; that's what the GST rebate is for. And there will still be lots left over to fund those social programs.
PP: But consumption taxes are regressive!
E: I know. But they introduce fewer distortions than the alternatives, and we can recompense low-income households for their lost buying power.
PP: But consumption taxes are regressive!
E: I'm not disputing that point, but there's more to the analysis than that. Okay, let me explain the effects of the various forms of taxes...
<15 years later>
E: ...and so we see that a consumption tax accompanied by direct transfers to low-income households is the most effective way of generating the tax revenues you want.
PP: But consumption taxes are regressive!

Of course, I prefer cutting the marginal tax rates to just sending out rebate checks.

The Americans are considering a VAT (Mankiw, Cowen). Mankiw suggests implementing it conditional on big cuts to spending, top marginal rates, and the abolition of the estate tax; Cowen takes a more fatalistic line, arguing it's the least bad doom which the US might face even without spending cuts or tax cuts, and even if some of the money winds up adding to total program spending. Says Cowen:

I am by no means convinced this argument is correct but I would like to hear the strongest arguments against it. No one I talked to succeeded in defeating it, other than mentioning they don't like the idea of more revenue for the government. You will notice I structured the argument to be as neutral on the "left vs. right" question as possible.

You'll notice the use of a pivot here: the common "right-wing" views that a fiscal crisis would be awful, voters are irrational, and governments make bad decisions in panic times, are used to favor a VAT.

I'm not convinced that the US would now get a VAT that would substantially lessen the risk of fiscal crisis down the road. Absent rather large structural spending changes (increasing the retirement age and so on), the VAT is more likely to postpone than prevent the crisis. Worse, there's reasonable chance that total spending increases with increased tax revenue, in which case the postponed crisis is more severe. I'm skeptical.

Update: Arnold Kling also thinks VAT insufficient to solve anything absent big cuts to elderly entitlements.