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Is It Marketing, Or Is It Naivete? Herman Cain’s 999 Plan, And Its Detractors

There are two front page stories directly attacking Herman Cain’s 999 Plan. They are both serious and fair attacks, by serious and fair people. I’ve been around a long time on Redstate and both streiff and Ben Howe carry a great deal of weight with me.

But I can’t help shake the feeling that they’re… willfully ignoring certain things to denigrate the 999 Plan. While risking being called a candi-bot or Cainiac or whatever, I’d like to undertake a defense.

Let’s All Agree 999 Plan Is a Great Idea

The first starting point — and this is important — is to recognize that everyone agrees that the 999 Plan is a great idea. Streiff admits “There is a lot that is superficially attractive about the plan.” Ben Howe goes further:

I’ll start with his 9,9,9 plan. On it’s face, there is a lot that I like about the 9,9,9 plan, besides its catchy name. I like that it lowers the personal and corporate income taxes to a low and flat level. I like that it eliminates other taxes like Capital Gains, Payroll & Self-Employment taxes. I like that it allows investments to be written off for business. There is a lot to like in this plan.

I haven’t heard a serious critique of the 999 Plan from the Right on the merits of the idea. For example, no one on the Right thus far has criticized 999 Plan for being regressive taxation on its face. I haven’t heard anyone critique it because it fails to combat the growing gap between the rich and the poor. Those are Leftist ideas after all.

From the Right, the criticism have all been on the merits of implementation, or rather, the impossibility of correct implementation. Hopes, rainbows, and unicorn farts.

On the Hopeless Naivete of Cain

So we get passages like this one from streiff:

The plan is unrealistic for two reasons: Congress must pass it and Congress must sustain it.

Anyone can see the inherent difficulties in passing the bill. Between the armies of lobbyists who would oppose the bill and the armies of lobbyists trying to make the plan an 10-9-4.3 Plan to help their clients the odds of passage in anything resembling Mr. Cain’s proposal approach zero. Mr. Cain is not going to have 60 votes in the Senate to prevent a filibuster and even absent a filibuster the responsibility for taxation lies in the House of Representatives. The House rarely, if ever, shows deference to a president, even one of their own party, when it comes to this core function. Again hope is not a method.

Distrust of Congress seems a fair stance. But hold that thought!

Here’s Ben Howe’s substantive criticism:

If the 9,9,9 plan played out exactly as Mr. Cain is suggesting, it might be fine. But the fact that he thinks for even a moment that it has a shot shows an ignorance of Washington unparalleled on that stage.

There are only two ways that I see 9,9,9 getting passed. One would be some enterprising Democrats realizing that they’ll have brand new money to play with and enthusiastically jumping at the chance to create a new revenue stream. The second way is if Gandalf the Grey summoned his giant Eagle friends to threaten members of Congress to make a constitutional amendment that forces it to stay exactly as it is…forever.

Believe me, I want the current tax code thrown out as much as anyone. I want to elect a Congress that will vote for a Flat Tax as well. But we can’t do that if we’re going to throw away all of our experience with government and ignore their penchant for taking a good idea and morphing into a monster.

Again, totally fair to distrust Congresscritters.

Both gentlemen — as well as most of the anti-999 folks — also take issue (as did Bachmann) that the 999 Plan might start out as 999 (assuming that Cain can get Gandalf to summon the giant eagle and get the bill passed), but it would be transformed into the 29-29-29 Plan in short order. Streiff writes:

You don’t have to be a genius to see how the 9-9-9 movie will end. It will be 10-10-10, 11-11-11, and so on because the plan makes no provision for capping increases.

So, in summary, we have:

  1. Cain is a political babe in the woods who has no idea how Washington works, and therefore, his whole 999 Plan is total nonsense suited only for fantasy novels; and
  2. Even if we assume miracles happen, and the 999 Plan gets passed, it will be corrupted by the evil wizards of Congress into the 90-90-90 Plan.

How’s All That Washington Insider Wisdom Working For Ya?

As a threshold question, I’d like to ask both gentlemen how all of the collected wisdom and savvy of navigating the halls of power in Washington DC have served conservatives and the nation in the past few decades. You know what? Forget the past few decades, when Republicans showed that they can plunder the public treasury as well as the Dems can; let’s focus on the past year and a half, since the tsunami of 2010 swept a new, Tea Party House into power.

There is this guy in the House, by the name of Paul Ryan. He became the Chairman of the House Budget Committee when angry voters sent him a flock of fiscal conservative freshmen. As I recall, he proposed a little budget plan under the name of A Roadmap for America’s Future.

As I recall, almost every single conservative — even the most devoted rabid activist types like us here on Redstate — supported the Ryan Plan. Quite a few people wanted Paul Ryan to run for President on the basis of that plan, of his rock solid fiscal conservatism, and the like.

Can we agree that if anyone understands how Washington DC works, how the levers of powers are pulled, how to work things so that they are acceptable to the untrustworthy Congress, Paul Ryan and his colleagues — people like Speaker John Boehner — are those guys?

Can we agree that given their extreme wisdom in the Tao of DC, they crafted a plan that was painfully moderate in its reach and ambition? For example, punting entirely on Social Security? (Which allows Romney to still be thought a conservative while mounting a defense of Social Security worthy of the #OccupyNarnia crowd.) Or, for that matter, not bothering to actually balance the actual budget until 2063?

But the Ryan Plan was seen as the height of sanity. What wisdom! What savvy! What deep understanding of the way that DC works!

Despite its wisdom, its political savvy, guess what? The Ryan Plan was defeated. The Senate Republicans didn’t even bother fighting for it.

Forgive me if I’m not all too enthused about the concept of being wise to the Way of Washington, if the result is that we can’t even get the Ryan Plan passed.

Forgive me if Cain’s response, when he was asked about whether he knows how Washington works (“I know how Washington works: it doesn’t!“), strikes me as eminently sensible.

Fact is, if we elect Cain and fail to elect a fiscally conservative (Tea Party-like) House and Senate to go with him, we’re not getting anything passed. We’re not getting the Ryan Plan passed. We’re not getting Romney’s 59-point Super-Duper Smart Guy Economic Plan passed. We’re not getting much of anything passed.

So what’s the guy to do? Run for office while assuming that Democrats will take back the House? Or retain the Senate?

Are we to assume that even if we send Jim Demint the “reinforcements” he asked for during Redstate Gathering 2011, and the GOP takes control of the Senate, and even if we strengthen Paul Ryan’s hand in the House by sending him a few extra Tea Party types… even that conservative Congress would not pass the 999 Plan simply because “it isn’t realistic by DC standards”?

It makes absolutely no sense.

The 2012 Election isn’t just about one office; it’s about the nation as a whole. I’m not donating only to Cain. I’m also donating to Ted Cruz in Texas. And looking at some other candidates who I think would be the reinforcements that Demint and Ryan have asked for. We can’t just get Cain/Perry/Romney elected; we have to take over the Senate and increase our advantage in the House as well. We can’t just win the election; we have to actually convince our fellow Americans that we conservatives deserve a turn at bat, having watched Obama/Reid/Pelosi wreck the country.

I operate under the assumption that any plan that any candidate has put forth will require a Republican (and not only Republican, but a conservative Republican) takeover of the Executive and Legislative branches.

So I should get excited about… I don’t know… say a plan like Romney’s that is ‘realistic’?

The answer may lie in his proposal to eliminate the capital gains tax—but only for those who earn less than $200,000 a year. This eviscerates most of the tax cut’s economic impact and also suggests that he’s afraid of Mr. Obama’s class warfare rhetoric. He even picked Mr. Obama’s trademark income threshold for the capital gains cut-off.

Yawn. And oh look, cut the top rate from 33% to 25%. Goodie. And a trade war with China! That’s a bonus. (Look, I’d criticize Perry’s plan too… if he had one. I’d be sure to look it over when he releases something other than, “I done it in Texas y’all”.)

At this point, ladies and gentlemen, doing Obama-Lite doesn’t excite me very much. And for all the talk of “hope ain’t a strategy”… seems to me that not-hoping wasn’t much of a strategy for our side either. All the careful calibration and careful moderation of the Ryan Plan got us precisely zip. All the wisdom of Boehner and McConnell and all the wise guys got us The Most Historic Budget Deal Like EVAH back in the spring, purporting to cut $38.5 billion but actually increasing the budget by $3 billion. I agree with Mark Steyn on such a wisdom-filled deal:

And in this case, it is absolutely not worth the time it takes to type up a bill that merely cuts the equivalent of two hours of government spending. This is why, if this is the best that John Boehner can do, I expect nothing from Harry Reid. But if this is the best John Boehner can do, then I’m sorry, this country is dead. And there’s no question about it, because the political institutions are impervious to course correction.

If we can’t put forth bold plans, because they’re unrealistic by the standards of political institutions that are impervious to course correction, then what the hell are we fighting for? To slow the inevitable decline by a couple of years?

C’mon, man!

But, But, But… The Corruption of Congress!

On the second major criticism, that no matter how idealistic and great the 999 Plan is, it will surely be corrupted by Congress… I have yet to hear from any critic why we should single out the Cain plan for such special treatment.

Romney plans to cut the top rate from 33% to 25%. That’s great!

And how exactly will Congress be prevented from taking that 25% back to 33% and then to 66% using the same logic being applied to Cain’s 999 Plan?

Let’s pretend that Perry has released an actual economic plan. What exactly makes it impervious to Congressional Corruption?

“Well, you see, Romney and Perry will cut spending” doesn’t cut any mustard, given that Cain isn’t exactly a dove on spending. He’s already proposed an across-the-board spending cut, to be followed by a “deep dive” into each department. It’s what a company in financial trouble does; it’s what the man has actually done; it’s what the man proposes to do to the Federal Government.

So the idea that Cain is some sort of a pussywillow when it comes to spending ain’t gonna fly.

“Well, Cain’s plan can’t bind Congress” is a complaint. Here’s streiff on this very topic:

Absent a Constitutional amendment, which Mr. Cain is not advocating, there is no mechanism to prevent the Congress from changing a 2/3 vote requirement to a simple majority vote in some subsequent piece of legislation. (Emphasis mine)

Is that so?

Here’s Cain at the Palmetto Freedom Forum (Sen. DeMint’s effort) back in September:

Cain told DeMint that he favors a legal requirement of balancing the federal budget. “I believe in a balanced budget amendment [to the Constitution]. Yes, because otherwise, we’re not going to have the discipline in Washington in terms of collectively of getting that.

Sure doesn’t sound like the Cain who is not advocating a Constitutional Amendment to me.

In fact, Cain was one of the first Presidential candidates — way back when he was a non-factor dark horse — to sign on to the “Cut, Cap and Balance” Pledge that Sen. DeMint and Lee were asking of candidates.

Now can we agree that may the guy does know something about Congressional Corruption? And that he favors measures to try to stop that? (To be fair, I believe all of the candidates favor some sort of a “Cut, Cap and Balance” mechanism, which includes a Constitutional Amendment.)

Streiff wants the 16th Amendment repealed. Good — so do I. Name one candidate who has signed onto that.

The general fear seems to be that Cain is giving the government a “new revenue stream” to mess with by introducing a national sales tax. I just don’t understand this particular line of reasoning.

Is the idea that liberal democrats are morons who sat around smacking their heads going, “D’oh! A national sales tax! Why didn’t we think of that?” when they heard of Cain’s 999 Plan? Is the notion that a corrupt Congress won’t think to implement a national sales tax or a VAT or a Breathing Air Tax or whatever other corrupt tax scheme until a Republican candidate for President proposes one?

C’mon, man!

It Isn’t Naivete; It’s Marketing

What Mssrs. Streiff and Howe both get wrong — and many of the other critics of Cain’s plan get wrong — is that they are mistaking brilliant marketing for political naivete. Streiff even gives a nod to the marketing here, but dismisses it:

Mr. Cain’s plan has an appeal that some wonkish 57-point plan never will. That it is appealing doesn’t mean it is either workable or a good idea.

Yes, that it is appealing doesn’t make it workable or a good idea. But it does make it an appealing idea. Which is a helluva lot better than the alternatives we have so far. You’re not going to find crowds at Romney rallies chanting “59 Points!” or even understanding what the hell is in his 160-page economic plan. (Although, a Romney rally where the crowd did chant his entire economic plan would be akin to a Buddhist funeral ceremony… hours and hours of chanting….) Perry’s economic plan is easy to understand, and has a built-in slogan… oh wait… he hasn’t released one yet. Nevermind then.

There is a reason why pizza guys and burger guys and retailers and other businessmen who have to deal with consumers come up with prices like $9.99 or slogans like “Tastes Great! Less Filling!” Because they plain old work.

There’s a deeper point to be made here. Cain often says on the stump that his job as President will be to educate and inform the American people, because “If people understand it, they will demand it.”

That’s Marketing 101, folks. Simplicity sells over complexity. Don’t believe me? Check the sales figures for the iPad vs. any of the competing tablet devices — many of which are more powerful, faster, and can do Flash. Check the history of the iPod vs. competing MP3 players. The brilliant engineers at Microsoft built a superior device in the Zune; the brilliant marketers at Apple ate the Zune for lunch without breaking a sweat.

If people understand the benefit and appeal of your product, they will demand it. 999 is simple to understand. It doesn’t take 160 pages to explain it to a bunch of wonks who can then sit around praising it for its moderation, its wisdom, its non-naive understanding of how Washington DC works. No, the 999 Plan takes 30 seconds to understand, by the average voter, and inspires them to demand it.

Is that so wrong? Is that so naive?

If it is, I don’t want to be right. I don’t want to be wise. Give me the wrong naivete of brilliant marketing that might get Americans understanding a candidate’s economic policy without a graduate degree in political science, so that more of them might get around to demanding that policy…

… in November of 2012.

I’ll take that every day of the week, and twice on Saturdays. (Because Sunday is for church and football, y’know?)

-TS

COMMENTS

  • beach91

    These are great points. I am on the fence right now between Perry and Cain but leaning toward Cain at this point. Perry has not released a plan that I can commit too yet so Cain’s plan is appealing. We already have sales taxes by the feds…just look at the gas pump the next time you fill up and you will see 18 or 19 cents ( I can’t remember how much). What is somewhat puzzling to me is when all these rates are lowered such as the corporate rate, will things effectively get cheaper..i.e the basic premise of the Fair Tax? If corporations are paying a much lower tax will that be seen in prices? It only takes one company to start and lower things before all begin to do the same. Also, even a flat tax can be gutted on the same premise that future congress people will blow it up.

    • cwfoster

      he leftists had said about four years ago “maybe Mr. Hopey Changey will turn into a totalitarian dictator, what THEN?”

      How about we start with what sounds good to us as conservatives and stop fretting about how palateable it is to the independents? As I recal, when we had some Republicans who ACTED like Republicans, we swept three straight elections, until the seciond guy George H.W. Bush started compromising his conservative values, and blew a MASSIVE approval rating in the immediate aftermath of Desert Storm and turned the White House keys over to Bill Clinton. And we learned NOTHING from the experience! If the Republicans act like freaking REPUBLICANS, and not ‘me too’ liberals, the indepenents will support them. The independents are independents because they don’t trust either party to be responsible adults and will go whichever way they think will show some responsibility. They supported Obama last time, because in spite of the Bush tax cuts increasing revenues, the deficits grew because the REPUBLICANS spent money still faster, and I’m talking about even BEFORE the Democrats took congress back in 2006! They made a choice to change, but they wanted a chage to the right, but they didn’t vet the loser they voted for and made a hard left turn, now they see the mistake. The choices we have to make are whether to offer them more of the same, but watered down (Romney) Inarticulate Texas Governor, MKII (Perry) or the true outsider, who never run for dogcatcher, and has a proven track record of turning failing enterprises around (Cain)?

      Sophist is right! I have a lot of respect for some of the older heads around here, but we’re starting to resemble a cancer patient who’s refusing chemo and radiation because we’ll probably die anyway and we don’t want to feel sick and lose our hair for the funeral!

      If that’s all there is to it, what are we fighting for?

      • beach91

        I have no idea what your comment was referring too. I have read it several times and cannot begin to understand if you are saying something according to what I said in my comment or not. Please explain.

  • http://www.nighttwister.com NightTwister

    That 9-9-9 is a great idea. It’s a terrible idea from its very foundation. Permanently adding a new revenue stream to the federal government is a profoundly terrible idea, and I would never support such a plan. It’s as bad as the Fair Tax, only worse because it doesn’t remove one tax for another. As I’ve been saying since I heard about this plan, 9-9-9 would eventually become 39-39-39, and some tea party group in the future would have to be rallying around a proposal to try to remove this additional revenue stream while wondering why conservatives handed liberals yet another way to reach into their pockets.

    • Craigpennsylvania

      You would prefer to have the 12.6 – 2.9 – 10 – 15 – 25 – 28 – 33 – 35 – 35 – 40 plan as purposed by Obama than the 9-9-9 plan proposed by Cain.

      • http://www.nighttwister.com NightTwister

        But yes, given the choice, I’ll take what we have now over 9-9-9.

        • http://www.redstate.com/thesophist TheSophist

          I’d take just about anything over what we have now.

          Purely selfishly, even if we’re looking at a 19-19-19 plan, I’d save money simply from not having to pay a tax professional upwards of $3,000 per quarter to do my taxes for me. Because with a college education, a law degree (with courses on Federal taxation, mind you), I’m still not comfortable doing my own taxes.

          The compliance costs that the current Code imposes on American businesses and tax payers is no small matter. We’re talking about $380 billion in 2010 in COMPLIANCE COSTS ALONE!

          And that’s not to get into the myriad, thousands upon thousands of loopholes in the current code that allows for extraordinary gaming of the system.

          Look, the 999 Plan isn’t perfect. Cain himself admitted as much. Refreshingly, he doesn’t pretend to know everything, and said it’s a bit of a work in progress.

          But the idea that 999 Plan hands liberals another way to reach into our pockets is simply banal. They don’t need us to hand them another way to reach; they’ll come up with all sorts of creative ways to do the reaching, trust me. Reid and Pelosi don’t need any help from a piker like Cain when it comes to thinking up new taxes.

          • intensity

            ….will NEVER pass through congress.

          • jqcjones

            “…will NEVER pass through congress.”

            NOTICE NO ONE ever says “IT WON’T WORK.” Only that it can’t pass… THOSE MORONS got O’BAMA care through didn’t they!?

            isn’t that what you said when O’Bama got the Democratic nomination? No WAY! He’ll NEVER get elected… LEARN from your idiotic mindset, people!

            Get off your arrogant high horses and lend some support where support is DUE. You simply say WHAT you say… because you don’t want HERMAN CAIN to get the nomination… Talk about NAIVE. It will be my PLEASURE to flip every one of you nay sayers off when Herman gets the NOD!

          • intensity

            …wil soon be declared unconstitutional.

          • Doc Holliday

            right after the SC declares eating hamburgers unconstitutional.

          • intensity

            …just like they’re throwing out Obama’s health plan!!

            Perry ’2012

          • Doc Holliday

            so how could the SC throw it out?

          • intensity

            …they’ll through it off the table before it even gets there.

          • Doc Holliday

            Most of the things I support would not pass Congress today, but I still support them. Why do Cain opponents think it is novel to claim one of his plans might have difficulty? Is this some new political phenomenon I missed?

            Last time I cracked a history book, conservative plans to reduce government and the welfare state were uniformly opposed by this group called the Democrats. How did Bush do when he tried to reform social security? Did Reagan get all he wanted?

            The nattering nabobs of negativity are well represented on RS this primary season. I have an idea. If someone does’t support Cain, why don’t they just say “I don’t like Cain?”. The argument that his plans to reduce taxes, reduce government, and spur economic growth “will have obstacles” is like telling us the sky is blue.

            I say forget the freaking plans. Cain is winning because he is fighting. The Perry fans better get their man a new persona quick, plans are not going to win this thing.

          • http://www.nighttwister.com NightTwister

            You say that one of the biggest selling points of 9-9-9 is the “$9.99 idea”. That idea is, people are more likely to buy something that’s $9.99 than if it’s $10.00. I don’t disagree with that.

            But then you say, even if 9-9-9 becomes 19-19-19, it’s still ok. Well, it’s not. And then you complain about the additional tax stream, and what difference does that make since they just keep increasing what we have now?

            Well, there is a difference, and you’ve made the point. There’s a ceiling above which people will rail against tax increases. You can only go so far until people say “enough’s enough”. There’s a natural barrier against tax increases. But, give the government another tax revenue stream and it changes that. People won’t consider two lower streams like they will a single stream.

            You can’t sell your idea on something, and then argue against it from another point of view.

            And while I agree that folks like Pelosi & Reid will always find ways to look for more ways to tax us, you see what happens when they do. The tea party started because some guy said, “this is too much”.

          • http://www.redstate.com/thesophist TheSophist

            My apologies for badly articulating my point then.

            I was trying to point out that compliance costs under the current system is ridonkulous, not that 999 would become 19-19-19.

            The notion that Cain is a dove on spending or on taxes is… shall we say unsupported by the man’s on-the-record comments, core beliefs, and every bit of evidence. I daresay it would be difficult to find anyone more hawkish in the current field.

            But perhaps you could consider the drag on our economy, as well as the corrupting influence of the current tax system that allows all sorts of favors, all sorts of gaming, and the like from the current system.

            It is literally impossible to defend the current system against ANY of the alternatives out there: flat tax, Fair Tax, 999….

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            Cain and the 999 lives of Cain?t never could do nuthin? – http://www.redstate.com/gamecock/2011/10/13/2241/

          • Matthew Morris

            My friend, where are these emotions coming from that could override such a bright person’s good sense?

            It comes down to this my friend: A fair (as defined by one number that applies to everyone equally- not as defined by a leftist… or a conservative for that matter!)… an innately and inherently FAIR, equitable, transparent, and easy to understand tax system, taxing effectively at TWICE the current highest marginal rates would be far better for this country and this economy than what we have now.

            Because with skin-in-the-game, it won’t stand! That nation-wide-skin would so transform politics in this country- you can’t even imagine!

            I would take a fair tax system paying twice as much as I do now in federal taxes over the mess we have today- any day! BUT, what’s awesome is, that (twice the taxes) will NEVER happen. Corrupt politicians will always corrupt a system to some degree, but when they are no longer able to buy votes from half of the non-tax-paying-populace, it will NEVER be anything but significantly better than it is now- in EVERY sense.

            Please tell me you (and other anti-999ers) will at least consider considering these points….

          • http://www.nighttwister.com NightTwister

            There are no emotions here. I’m just calling a profoundly bad idea exactly what it is. I’ll never support an idea that gives Democrats (or Republicans) another revenue stream. Try again.

          • Craigpennsylvania

            Nighttwister, we have three taxes already: FICA, Personal Income Tax and Corporate Taxes. In the past 30 years, all three have been changed several times.

            The current rates are as follows:

            FICA: 15.3 % on the first $106,000 and 2.9% above that. The Dems would love to eliminate the $106,000 income cap.

            Income Tax: Rates vary from 10% to 35%. The Dems want to make the top rate 40%.

            Corporate tax: Rates vary from 15% to 35%. The Dems want to make the top rate 40%.

            Under 9-9-9, we lose the FICA tax. We would still have three taxes.

            Please detail how 9-9-9 is more susceptible to being raised than the FICA (which has had at least two major changes in the past 30 years), Current Income or Current Corporate taxes.

          • http://www.nighttwister.com NightTwister

            You can separate out payroll taxes into bits and pieces all you want, but it’s still all payroll taxes. A national sales tax is a new way to tax.

          • Craigpennsylvania

            If one was to draw a logical conclusion based on your own words, it is now how MUCH of your money the government takes, it is how they take it.

            The federal government automatically deducting the first 15.3 percent of the first $106,000 you make is ok in your world. The federal government also will automatically increase this $106,000 threshold each year.

            Having to pay 9 percent on the purchases of NEW products to the federal government is bad in your world. It is SO bad (in your mind) that you would prefer to pay 15.3 percent on the first $106,000. You don’t care that this tax is at a rate which is 70 percent higher than the 9 percent sales tax as proposed.

            Your previous argument about how the 9-9-9 program was going to be 39-39-39 has now been abandoned by you. In the meantime, people are actively working on eliminating the Social Security Cap.

            One can see how the Tax Policy Center is pushing for this here:

            http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=2295

            If the Dems get their way – and yours (you DID say you would take the new taxes proposed by the Dems over 9-9-9) – the top tax rate will be 55.3 percent on income. This is based on the Obama proposal of increasing the top marginal rate to 40 percent and this elimination of the cap on Social Security taxes.

            Should the Dems get their way on all this, the LOWEST effective tax rate will be 25.3 percent and the highest 55.3 percent.

            AND the top corporate tax rate will be 40 percent.

            This information was not posted because I thought it would convince Nighttwister. It was posted so those lurking would have additional information.

          • http://www.nighttwister.com NightTwister

            I said I’d take what we have now over Cain’s 9-9-9. Thankfully, I won’t have to worry about the latter because Cain isn’t going to be the nominee anyway.

          • avagreen

            So, what will happen to SS and Medicare if FICA “no longer exists”? May seem a good idea to those young enough to start their own savings accounts, but what about current and soon-to-be retirees? This retirrment fund depends upon new monies (which at the present is 3:1 I believe).

            At least the current crop of people wanting to do the needed tampering have suggested a new type of investment program for younger workers, while keeping the present system in place for current and soon-to-be retirees. However, that again doesn’t address where the $$ will be coming from to keep the promises made to these folks back in 1935.

            This question about 999 has been glossed over in any glowing reports about 999 as far as I can see.

            If I’ve missed it, point me to it. And, pie-in-the-sky platitudes won’t cut it, either.

            What are the plans under 999 for all the retired?

          • avagreen

            i can promise you that not one retiree or soon-to-be retiree will vote for this guy and his 999 plan.

            That’s a LOT of votes!

          • Vaughn Harold

            States bring in revenue from the same three sources and people are able to keep in check at the state level.

            This revenue stream issue is bogus

          • nick2253

            And, actually, the federal government has even more income streams.

            Not only do we have Income, FICA, and Corporate taxes, we also have:

            Capital Gains Taxes
            Gift Taxes
            Estate Taxes
            Fuel Taxes
            etc.

            Under 999, all of these taxes will go away. The reason that Democrats haven’t implement a federal sales tax is the exact same reason as to why the Democrats couldn’t re-implement any of these taxes. We’re basically trading 5+ taxes for one tax, and that one tax is one that people will see every day that they go to the store, instead of a number of hidden taxes that they only see if the look at their paystubs, or class taxes that only affect the wealthy.

            999 adds HUGE amounts of transparency to the tax system, MASSIVELY eases compliance, and, finally, does away with our horrible system of picking winners and losers through deductions and credits. Taxes should never be used to shape policy, and 999 helps make that a reality.

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            as I discuss in my new column, all systems will change. I think I effectively address your sales tax as one more way to tax fear. The positives outweigh the negatives, which negatives will apply to any plan in near equivalent degrees esp since there will never be a repeal of the 16th. Must we wait for the 16th A to be repealed to scrap the current code? I used to think we had to wait for a fence to quit punishing longtime illegal residents that are part of this country too…I moved let on that recently…

            But as to Cain and 9-9-9

            Cain and the 999 lives of Cain?t never could do nuthin? – http://www.redstate.com/gamecock/2011/10/13/2241/

          • Flagstaff

            In response to “I just can’t understand this… ”

            I also don’t like 9-9-9, although I do like Cain. But as to why–

            I am retired. I have moved a good deal of our retirement funds into Roth IRAs. Maybe a mistake, but it’s done and can’t be undone. The money we have outside of IRAs is all after-tax at this point; that is, we’ve already paid tax on it, as we have no on the Roth IRA funds. So on all that money, our effective income tax rate is or will be nearly zero under today’s tax system. I can only assume it will also be zero under 9-9-9, so that’s ok.

            But as for what happens to the money after it is withdrawn from the Roth IRAs, we would now be taxed an additional 9% on every dollar we spend, with apparently no “prebate” included in the plan. Looks like it would effectively add a 9% surcharge on the interest I pay on my home mortgage, and would add 9% additional sales tax to the 10% sales tax we already pay in Arizona.

            I don’t pay FICA, so I would save exactly $0.00 in FICA taxes–saving those taxes is supposed to be a big advantage of the 9-9-9 plan.

            But really, my biggest objection is that I agree with all the folks who say “Repeal the 16th Amendment first, then we can talk about a sales tax.”

            Anyway, it all leads me to believe it would never pass in its present form, which means we are wasting time discussing it beyond its peremptory dismissal.

            **”But the idea that 999 Plan hands liberals another way to reach into our pockets is simply banal. They don?t need us to hand them another way to reach; they?ll come up with all sorts of creative ways to do the reaching, trust me. Reid and Pelosi don?t need any help from a piker like Cain when it comes to thinking up new taxes.”**

            Don’t you see the falsity of that argument? The unholy three may not need any help from Cain to come up with new taxes, but there is no reason for him to help them do so by proposing a new tax form himself. This is the very transgression that Romney is being vilified for–he helped the Massachusetts legislature pass a medical insurance bill that we don’t like. They could have done it without him, and it would have been worse, but we don’t give him that recognition–we call it RomneyCare. It is the very threat of a Presidential veto (and a public uprising) that keeps them under control now; why should our President even consider supporting such a tax, giving them cover and perhaps a new tax?

            On this issue, I agree completely with Night Twister, even though I personally might benefit from the change in the long run. In the long run I’m going to be dead.

            All I can agree with Cain on this one is that it’s a start, and from this start he might develop something with different rates and no sales tax. Hey. How about going back to the original Reagan tax rates with the schedule break points adjusted for inflation? Fix Social Security separately. Fix Medicare separately. Our problems seem to emanate from everything called “comprehensive,” because “comprehensive” plans tend to be too big to be understood, with loads of unintended consequences.

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            inexplicable

            It would ordinarily deflate me a bit (at least to where I would twist in the night), but given this is Week 7 of the College Football Sabbath and USC won on the road to stay in first in the SEC East, me and Cain be happy with 999 bottles of beer on the wall that are all mine since Herman does’t drink.

          • streiff

            and do so from the position that Congress will not raise the tax rates.

            The top rate of the original income tax was 7%. What makes anyone think this new scheme fronted by Cain would work out any different.?

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            and live like Elvis. Then JFK cut rates and we rocked along with the highest standard of living the world ever saw esp after Reagan fixed it again for 25 years.

            How does anything humans do “work out’? The feds tax us in scores of ways now. There will be no anti-Prohibition like uprising of unity to repeal the 16th Amednment. Booze was more important!

            Hence, we do what we can. And slashing rates as low as 9-9-9 while eliminating scores of kinds of taxes that are constitutional and adding only one at such a low rate would “work out” great for a time.

            Conservatives need to understand our own message to the liberal Utopians. There is no magic fix so that we never have tax codes get bulked up again. Just look at Georgia’s sales tax code! Look at any tax code over time.

            Heck, I have to sweep the floor now and again.

            Just because no plan will be heaven forever is no argument against it.

          • http://impudent.edublogs.org/ kyle8

            If a newly elected Republican administration wastes it’s time and political capitol on a tax bill, when we already have very low tax rates.

            Then the real problem, which is runaway spending goes unabated.

            Furthermore, a new tax code, no matter how favorable will NOT spur much economic growth this time, because the spending is just too large.

            The government borrowing is crowding out private investors. The Fed is forced to keep the rates low to pay for it, and the result is that Banks will not lend since they can make more money from the Fed’s free money.

            There is no growing out of this one, it is just too much debt, and more on the way with all the entitlements. WE HAVE TO CUT SPENDING AND REGULATIONS!!!!!!!

            We cannot become distracted with an unneeded tax reform, do that later when we have had some success on the spending front.

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            The Tax plan is the real stimulus the economy needs. It needs to be unleashed. We can walk and chew gum. and cutting spending is too narrow a priority anyway. The “low rate” tax code despite the “low rates” is an albatross on growth and on competition with other nations.

          • http://impudent.edublogs.org/ kyle8

            any new administration has only a limited time and a limited amount of political force it can use. If you waste it on a very very difficult tax bill you wont be able to do much else.

            Also, as I explained, without a major cut back on spending you will get no growth no matter how much you cut taxes because of the crowding out of capital.

            TAX CUTS ARE NOT MAGIC JU JU ! They do not always lead to growth. It depends on where we are on the Lafer curve, and on other factors.

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            tax reform and spending cuts at the same time, then why bother getting elected in the first place. We must and will try to do both. But thanks for explaining “crowding out’ to a Phi Beta Kappa econ major…smile

    • Vaughn Harold

      stream is bogus. The government needs so much revenue in order to function, and the government will find anyway it can to bring in that revenue. To my understanding the only way to curb the amount that the government can spend is through an amendment to the constitution. So simplifying how the government brings in revenue to meet the amount of spending is a great plan, it keeps politicians and businesses from gaming the system, and allows the American people the opportunity to raise hell when they can’t afford to live when tax increases are debated in the future.

      • http://www.redstate.com/thesophist TheSophist

        Could we focus on whether the 999 replacing the current system is a good or bad idea instead of the straw man of “higher taxes forever”?

        I’d LOVE to be able to file my taxes on a two page form, and not pay an accountant $10K a year to do that for me with all the various schedules, exemptions, and the rest of it.

        Wouldn’t you?

        • Vaughn Harold

          the possiblity of the 9 9 9 going to 10 10 10. It was about how bogus the whole new revenue stream argument is. The government generates new creative ways of getting revenue all the time. We need more transparency and simplicity for the American people to know what there elected officials are doing with their hard earned money. Cain’s plan is defiantly based on that goal.

          • Vaughn Harold

            how they are taking

        • streiff

          I think my post is pretty clear. 9-9-9 is a boneheaded idea in that it creates a means for the federal government to tax all transactions regardless of an interstate commerce connection. It is merely a bad idea because it presumes the tax rates won’t increase.

          When the VAT was introduced in Britain in the early 1970s it was 10%. Now it is 20%. That isn’t a strawman, that is what is known as “history”.

          • http://www.redstate.com/thesophist TheSophist

            just realize you’re beating the dead straw-stuffed pony to death, that’s all.

            I get the “historical” argument, I do. What I don’t get is why you’re singling out the Cain plan for such treatment.

            “It won’t pass” is a bad argument, since none of us know what would and would not pass in a conservative-dominated House and Senate (which is what we’re all working towards, right?)

            “It will grow” is a fine argument, except that it also applies to literally every single idea out there. The income tax has gone from single digits to nearly half my paycheck; does that mean I should reject Romney’s plan out of hand since, “it will grow” as well?

            It might be history, but it is a straw pony as far as you apply it ONLY to Cain.

          • gator_hoo

            Because his puts out a new revenue stream, that’s why.

            You consistently gloss over the fact that politically, it is a LOT easier to raise an existing tax than to create a new tax. Cain’s idea is the only current one that creates a new tax, and therefore does the heavy lifting politically for those who want more taxes. That is why Cain’s plan is seen as more corruptable than other plans.

            Secondly, in most states and towns, there is already a 6-10% sales tax. Let’s see how well sales do when that becomes a 15-19% sales tax. You are encouraging depressed spending, and while I agree that many people need to spend less than they currently are, the ramifications of incrasing the costs of goods to that degree needs to be carefully considered, and nobody is even discussing that.

          • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

            with political baggage over time, until a Reagan or Cain comes along and cleans house and lowers rates. History shows this.

            There are good arguments for Flat tax plans that could be better than 9-9-9, but there are no credible arguments that 9-9-9 would not be good now and would have just as much chance of being good for many years as any other plan, given human nature.

            Yes, Europe chose full-blown socialism decades ago. Americans have not. It creeps here and we periodically strike back.

            No, the genius and positives of 9-9-9 that outweigh the “risks” (which risks are in all plans) are its trashing of the whole Code (or pretty close even faster some inevitable tweaks) and single-digit rates that will have a built-in deterrence against raising them..

            9-9-9 will good as a massive jump start and great for many years. The plan’s success will be immediate and great for as long as it is great and that it won’t stay 9-9-9 till the next millenia matters not.

            Was Reagan;s 25-year recovery good or was it all a failure since Bill Clinton and Obama got elected down the road?

            Of course it was good thing.

            It would be better for conservatism if no significant segment of the movement is only for plans that will guarantee perfection for a century or more and that don;t pretend that a FAIR Tax or modified Flat Tax would.

      • streiff

        explain why it is conservative to favor a new federal tax and explain why the 9-9-9-9 is impervious to future Congresses raising it.

        If you can’t do that, stop saying the arguments are bogus. If you won’t do that then you’ll need to find another place to post.

    • aesthete

      Taxes, unlike spending, are unpopular. We haven’t had a major federal tax hike in years: though we have had some reshuffling of tax rates, the last major tax hike was under Clinton and wasn’t even that major of a hike. Along with gun rights, taxes are one of the few issues that conservatism has been victorious on consistently, and I highly doubt that Democrats working to raise a very regressive, highly visible tax like the sales tax would work any better than them trying to raise a progressive tax like income tax, or an unseen one like payroll withholding or corporate taxes. At any rate, spending without taxation or very low interests is just taxation deferred in the form of inflation or later tax hikes.

      • http://www.nighttwister.com NightTwister

        The basic argument is that two (or three) low numbers are better than one higher number. My argument is we’ll have two (or three) higher numbers eventually, and as streiff has pointed out, this isn’t an academic exercise, it’s a historical one.

        You want to have your cake and eat it too. It just doesn’t work that way in the real world.

        • aesthete

          I don’t agree with Cain here. I just don’t think it’s worse than the status quo — generally speaking, the less revenue sources that are being taxed, the more difficult to raise taxes. 1 (flat tax) > 3 (9-9-9) > 9-10.

        • thirstyboots

          Is that the federal government revenue as a % of the GDP will remain more or less stabilized (and tapped at around 20%) regardless of the tax structure.

          Plus, as noted above, the true level of taxation is generated by the government spending levels, not the tax rates or revenue.

          The relevant question is: which is the most efficient and less distortionary tax structure? I believe that consumption taxes are better than income taxes because they do not discourage saving.

          I’ll support any proposal that shifts the tax structure into that direction.

          • http://www.nighttwister.com NightTwister

            Say what you want, but the Democrats and media will rightly call it a tax on the poor. It’s not a winning message. There are better ways to get there.

          • nick2253

            Sales taxes are most definitely regressive, but the prebate fixes that.

            Furthermore, if you are really intent on making in progressive, the tax could vary on different classes or prices of goods. For example, luxury goods, like fur coats and jewelry, could have a different tax rate than staple goods, like food or gas.

            Now, I understand that there are problems with this system, and many people here have voiced their concern over the prebate. But if we have a conversation about the merits of those tax systems, instead of the red herring debate on whether or not those tax rates will go up, we can get somewhere.

            I’m not trying to pick on anyone, but it’s really frustrating when I see thread after thread about the “dangers of potential tax increases.” That argument doesn’t get us anywhere because its a flaw that all tax systems, including our current one, suffer. /rant

            Sorry ’bout that. Just had to get it off my chest.

          • http://www.nighttwister.com NightTwister

            New taxes, their potential increase, along with increasing the old taxes back to their previous higher percentages. It’s a valid argument regardless of how much you’d like it to go away. Rant all you like, but nobody’s shown me how it isn’t going to go there.

            And while we’re on the Fair Tax, getting every single American used to receiving a regular check from the government doesn’t seem to be a winning strategy either. I get what you’re doing, but I don’t like the psychology behind it. Too many people now are too used to getting free money from the government.

            And also while we’re at it, for those of you NOT in Colorado, we just had a tax increase last year. What’s that you say, don’t you have a Taxpayer Bill of Rights (TABOR)? Sure we do. Normally, they’d have to get voter approval, but since one of the new taxes was actually eliminating an exclusion, the State Supremes ruled that it wasn’t actually a new tax, so they got away with it. See my concern? They’ll always find a way around how the law was intended to be enforced. There goes your argument for requiring a super-majority for increases.

          • nick2253

            but I think your concern is misplaced. Let me try to answer this again, and let me ask you a few questions. It’s quite possible I’m the one who is ignoring something. (Also, I’d love to have a debate on the prebate, because I’m honestly up in the air about it, but I don’t really want to address that hear to prevent clutter)

            When I look at taxes, I see only one means by which the people can prevent increased taxes: electing politicians that won’t increase taxes. And I think we’re on the same page here. So let me pose a though experiment:

            Say I get Congress to pass my Tax proposal. Call it Nick’s Tax Plan. My plan sets the rates to some value, and has some certain combinations of deductions and credits.

            Now, evil Congress comes along and tries to add a new tax to my plan. Call this tax “Congress Tax.” If Congress gets its way, it will get this tax. If the people get our way, then we won’t get this tax.

            Also, the evil Congress comes along and tries to increase the rates of one (ore more) of those taxes. If Congress gets its way, it will raise the tax. If the people get our way, the tax will stay the same.

            (I’m really not trying to set up a straw man here, so if something isn’t working for you here, call me out on it.)

            I propose two scenarios:

            1) Nick’s Tax Plan is actually our current tax system, and the Congress Tax is a sales tax, and Congress succeeds in raising the income tax.

            2) Nick’s Tax Plan is actually 999, and the Congress Tax is any one of FICA, estate, gift, capital gains, gasoline, etc., and Congress succeeds in raising one of the income tax, sales, tax, and/or corporate tax.

            Why is Congress more likely to succeed in adding the Congress Tax in scenario 2 than in scenario 1? Why is Congress more likely to succeed in raising the tax in scenario 2 than in scenario 1? As I see it, there’s no difference. Congress’s ability to add or raise taxes under our current code is, if anything, easier than it would be under 999.

            I feel like the opinion of the masses is that “999 is [adjective here], so it will be easier to change.” However, I haven’t seen any evidence of that being the case. Given the complexity of the current tax code, it’s impossible, even for tax attorneys, to be fully aware of everything in the tax code, and demand accountability. Under 999, the tens of thousands of pages of the current tax code will be replaced by something that any person could read in a week, at worst. In that way, we could all be aware of what’s in the code, and we could all demand accountability from the government.

            There’s one more issue that I’d like to address. I keep seeing people refer to a national sales tax like it’s something that we’ve never had, and so they are afraid of introducing a completely novel revenue stream. That’s not entirely true. Since the late 1700s, the US has had various forms of selective sales taxes (aka excise taxes). Currently, the federal government collects excise taxes from the purchase of alcohol, tobacco, gasoline, airline tickets, tires, and many other things. In fact, Obamacare added a 10% excise tax to tanning booths. During the Civil War, the excise taxes were so ubiquitous that there might as well have been a national sales tax.

            Basically, there isn’t any part of 999 that provides “new” sources revenue to the government. If anything, it removes sources of revenue. Most importantly, however, is it adds transparency to the tax system, something we sorely need.

          • http://www.nighttwister.com NightTwister

            First of all, there’s no way the democrats and media don’t rail about how Republicans want to tax the poor to get us out of this mess we’re in. Tax the poor has the same social heart-tugging factor as Save the Whales. Like it or not, the majority of voters are going to be against any tax increase on the poor at this time. If you try to push that as your tax plan, you’ll get eaten alive.

            Ok, so let’s move past that and say the 9-9-9 plan gets through and enacted as law. All those excise taxes go away until….

            1. A bridge in a major city collapses. The Administration and Congress spend days in the news talking about how this new tax plan has caused us to neglect our crumbling infrastructure, and why we need a fuel tax to fix it.

            2. An airplane crashes at a major airport killing hundreds. The Administration and Congress spend days in the news talking about how this new tax plan has caused us to neglect our airports and why we need an airline tax to make them safe again.

            3. Some famous person dies from lung cancer. The Administration and Congress spend days in the news talking about how this new tax plan has caused us to stop spending money on cancer research and why we need a new tax on tobacco to find a cure.

            Sooner or later all those taxes are back, because people are already used to them. The problem is, the national sales tax doesn’t go away, because we still need that. Then the Democrats get in and increase those 9s to 19s…29s…39s… We haven’t been able to eliminate all these other taxes you’ve been so kind to list, so why would anyone think we could ever get rid of the national sales tax. It’s a dangerous road to more government, more control, and more money out of my children & grandchildren’s pockets.

            No Thanks.

          • nick2253

            You’re continuing attacks against 999 effectively assert that our current tax code is somehow immune in ways that 999 isn’t. Also, there are multiple debates going on here: “can 999 pass?” and “is 999 a good plan?” If we can convince people of the latter, than the former will happen. It doesn’t matter what the media and the Democrats say. The “can it pass?” argument comes later.

            First off, what’s to prevent Congress, like they currently are, from slowly expanding the excise tax into a general sales tax? Nothing. We’ve nearly done it once as a nation (see Civil War), so reaching that point is not “new ground.” Even though we’ve never had an official sales tax, that doesn’t mean we’ve never effectively had a sales tax. Your argument that 999 introduces some new precedent for a sales tax is invalid. The precedent was set in the 1880s.

            As far as the inability to “get rid of the other taxes,” it’s primarily because these taxes are hidden or narrowly targeted. Ask any average person on the street how much federal excise tax they pay on gasoline. I guarantee you the response will be something like “excise-whatta-whooda?” People won’t rally behind a movement to get rid of the taxes unless they know about them. That’s the beauty of 999. In changing the taxes that people know and care about, it can–dare I say–stealthily remove all the rest of the crap that’s built up in our tax code.

            In your three points, I could replace “this new tax plan” with “our current tax plan,” and your premise would not change. In fact, I could replace “this new tax plan” with “this new bill”, “this new policy”, or any such proposal or plan, and you premise would still not change. Your concerns are not unique to 999, but reflect a possible reaction to any government bill ever.

            Now, let’s assume your worst case scenario: that under our current system, we would never let our excise taxes convert into a general sales tax, and that under 999 all these taxes and deductions would come roaring back.

            It this case, the absolute worst thing that would happen is that 999 becomes our current tax system plus a sales tax.

            When do you think this is going to happen? As I see it, there’s no way 999 can get worse than the current system in the short term. How can resetting the tax code be a bad thing? Think about it: in one fell swoop we clear out all the credits, deductions, and piddly taxes that most people don’t even know about. It’s like resetting the tax code to square 1. I can’t image that we would let Congress muck it up so bad as to be back to the current tax code in less than a decade, at earliest. And it’s not like 999 is the last chance we’ll ever get. By the time our children and grand-children start paying taxes, I’d hope that we’d have moved farther along the tax-reform road.

            I can’t understand how, even in the long term of two generations down the road (40 years), 999 could give us something worse than what our current tax code would give us in that same period.

            Lastly, and I don’t mean to be rude, but I think that it’s naive to believe that, under our current tax system, we won’t have a sales tax within 40 years. Once times get better, government will do what government always does, and look for more revenue. Our current debt and deficit are obscene, and government will turn to taxes as the solution. One of two scenarios will play out: (1) people will be strong enough to say “No,” in which event something like 999 would go unchanged, or (2) people won’t be strong enough, and Congress will eventually enact a sales tax.

            Your concerns all assume that scenario 2 will be the norm, in which case nothing short of a BBA will stop Congress. Your children and grandchildren will pay more money and have less control whether you like it or not. If your only acceptable tax reform direction is a BBA, what happens in the mean time? 999, and similar plans, provide a stop-gap in order to reset the tax code while we push for a BBA.

          • Flagstaff

            In this case, it’s that we need to tax the “poor” at least a little bit, because there isn’t enough money left in the pockets of the “rich” to pay for all the stuff that the “poor” seem to “need.” When the “poor” start paying for some of it themselves, they might decide they only want it, not need it.

            In fact, if I weren’t rapidly moving towards become “poor” myself, it’s the one thing I like about the sales tax idea.

          • Flagstaff

            And I completely agree with it.

          • Craigpennsylvania

            Nighttwister, you are correct in stating people will call this a tax on the poor. The Dems will call anything which is not loaded with higher marginal rates for those making over some arbitrary income level “unfair”.

            Running a campaign based on what the Dems think is not the approach one should take.

            As a business owner, and one with many good employees, I had a conversation with two of the techs from one of our dealerships today.

            I explained the 9-9-9 plan using real numbers.

            Here are the numbers for just one of the techs:

            His weekly average gross pay is $1150.

            From this he pays $178 in taxes based on the lower 4.2 percent rate for Social Security that he sees come out of his check today. We took this right from his paycheck. He understands that this will jump another $23 on January 1.

            The first thing he saw was that the 9-9-9 plan would mean that he would have $104 taken from his check. This leave him $74 left over.

            It was then explained to him that the business has to pay $88 with each pay check.

            His current net take home after state and local taxes is $927. After January 1 it will be $907.

            The 9-9-9 plan would leave him $1002. If he spent the entire $1002 on new “stuff”, he would have $912 in purchasing power under today’s system.

            He immediately thought of a few things.

            1. The $88 the boss did not have to pay means more money in the budget to pay him more.

            2. He could work overtime and not worry about losing a lot of it to taxes.

            3. He buys nothing but used vehicles, used furniture – most big ticket items are purchased used, so he would not spend the whole $1000 on new stuff.

            The man loved the idea.

          • Craigpennsylvania

            Over the past few years, similar conversations have been had with employees using the “Fair Tax” and “Flat Tax” concepts. Each time the employee preferred the simpler taxes to our current system.

          • http://www.nighttwister.com NightTwister

            You didn’t even address what I said. I’m not sure who you were writing this comment to.

          • Craigpennsylvania

            Some people understand and appreciate friendly conversation and real world examples. Some are incapable or unwilling to do so.

          • http://www.nighttwister.com NightTwister

            I’m not here to make friends or have friendly converstation. I try to be pleasant in my responses, and I believe I was in my previous one. You never addressed my concern, and quite frankly I don’t care if you do. I was just stating that you didn’t.

            Have a nice evening!

          • Craigpennsylvania

            You said: “Say what you want, but the Democrats and media will rightly call it a tax on the poor. It?s not a winning message. There are better ways to get there.”

            I responded with an example using a normal individual making under $60k per year in income.

            I also suggested that rejecting an idea because the Dems and media won’t like it is not a winning approach.

            You cannot understand how this was a response, and a friendly one, to your post.

            You think we need to avoid upsetting Democrats and the Media in order to win. So did John McCain. How did THAT work out? ;)

          • http://www.nighttwister.com NightTwister

            ..no…..text..

          • Craigpennsylvania

            The poor don’t purchase new things. They don’t buy new cars. They don’t buy new homes. The net effect of the tax would be very small, especially in light of the fact that the poor would have much better upward mobility with ANY plan that has lower tax rates, compared to the current system.

            The current system encourages the poor to stay poor. The “Fair Tax”, “9-9-9″ and flat tax provisions encourage the poor to work hard in order to stop being poor.

            The Dems and Media will attack any of the three systems.

            If the standard for change is making the Dems and Media happy, as you suggested in your post, then conservatives will lose.

          • http://www.nighttwister.com NightTwister

            Honestly, I don’t know what to say. The fact that you don’t get that making your message tax the poor means you really just don’t get it.

            I care about those poor people. Many of them are honest, hard-working people that are either just starting out or have fallen on tough times. They aren’t all lazy drunks and drug addicts.

            Like it or not, these things matter in an election. You can say you want to tax the rich and get away with it (see Obama), but you won’t by saying you want to tax the poor.

            The thing is, you actually have to get elected to implement your policies.

          • Craigpennsylvania

            Mr. Twister, the heading was not “tax the poor”. The heading was “A tax on the poor”. The point was it is my opinion that 9-9-9 and other tax reform ideas are not a “tax the poor” idea. You are the person who agrees with the Dems and Media that 9-9-9 is “taxing the poor”.

            I am not a proponent for taxing the poor. I never mentioned the poor as lazy drunks nor as drug addicts. You are merely making up things now.

            My thinking is low tax rates will encourage the poor to work hard to get out of being poor. We are not meant to be poor, Mr. Twister. We are meant to improve our lives by working hard. Our current tax system holds people back.

            I personally have many people in my employ who were “poor” before we hired. I have a junior partner who came to his first interview with me as a 18 year old in torn jeans. He became a partner this April. He is a good man who also understands that our lives get better by making the lives of others better.

            I refuse to be afraid of what Democrats think of me. Instead, I encourage each person I know to make his or her own way to the best of his/her abilities.

            Our companies are involved in over 20 different charities.

            I most certainly “get it” about the poor.

            And the best cure for the poor is to show the poor, one person at a time, how to succeed.

          • http://www.nighttwister.com NightTwister

            You can try to deny it all you want, but those that currently do not pay taxes WILL pay taxes under 9-9-9.

            Whether that is right or wrong is certainly a discussion worth having, but they are not incorrect in saying that it actually does raise their taxes. In my opinion, at this point in time, it is not a winning message. Those that choose to ignore that do so at their own peril.

          • Vaughn Harold

            The taxes that they see taking out of their paycheck will be 1.35% higher because FICA is 7.65%. I’m fairly certain that most companies would increase their wages to offset this cost. It does however limit their purchasing power with the sales tax increase, but buying cell phones and other luxury items is not supposed to be of their upmost concern.

          • http://www.nighttwister.com NightTwister

            Another winning strategy.

            /snark

          • Vaughn Harold

            make their own way. I have to live without things I want all the time. Hell if it’s that important I would work another part time job.

          • Vaughn Harold

            give the poor charity to help those customers who are less fortunate. Again, I for anything that gets the government out of social services as much as possible.

          • http://www.nighttwister.com NightTwister

            Seems you forgot one of the nines.

          • Scope

            few who yelled out “let them die” in the debate when Ron Paul was asked about medical care for the uninsured.

          • Vaughn Harold

            purchasing power

          • lineholder

            because it’s personal, okay? Does 12K per year count as poor, NT? That’s the bracket I’m in, and I’ve still been backing Cain’s plan anyway. Why? For a couple of reason. The first is that is it is the only plan I’ve seen so far that has the potential to open up the door for any broad type of growth and development in the private sector relatively quickly. Yes, it could cost me more in taxes, but it could also provide greater opportunities where jobs are concerned. The hope (and there’s that dreaded word again…hope) is that job prospects will offset the taxes, you see.

            Plus, I’m not exactly a spring chicken, you know. Before I know it, SS time will catch up with me. I still have over a decade+ to go before I hit that point, but…jobs are tight. Competition is tough in the job market for someone my age. Spending cuts alone aren’t going to get our economy up and running. Tax reform could. The sooner our economy is up and running again, the better my chances are that that I won’t end up entirely dependent on family members for the rest of my days, and the greater my chances might be of staying away from excessive dependency on the government as well. If you call that a poor person’s goal…well it keeps me going for now. I don’t know how many other people in similar circumstances might be thinking some of the same kinds of things, though.

            I’ve got others reasons as well that involve shades of both patriotism and a genuine belief in the people of this nation, plus breaking away from an acceptance of mediocrity that seems to be pervading our society and bogging us down. I definitely believes that Cain has what it takes to inspire people on that point. We genuinely need a leader where that is concerned. Sentimental, I guess it might be called, but it’s there all the same.

            I am blessed in the fact that I have family members who are helping me out right now while I go back to school. If it wasn’t for them, I don’t know what I’d do. That has to be taken into context as well.

            Like I said, I wasn’t sure about doing this, but decided that I’d speak my mind on this one anyway. Just FWIW, you know.

          • nick2253

            And no one is calling all poor people lazy drunks and drug addicts.

            Does 999 increases the taxes on the poor? Yes. But, importantly, it decreases the taxes on the middle class. You cannot tell me with a straight face that the message “cut taxes to the middle class” won’t sell.

            If you are in the lowest quintile, you pay an average federal tax of about 5%. That’s factoring in income, FICA, excise, etc. 999 would increase that burden to over 9%, and no one is disputing that. In fact, you’re exactly right that one of 999′s biggest issues is the increase for the lowest quintile.

            Now, I have a challenge for you: how would you fix 999 so that it isn’t a “tax the poor” program? The problem is that you can’t have a program that makes everyone winners and keeps revenue the same. Under our current tax code, the poor are the big winners. 999 does a lot to even the tax burden, and in part of that, the poor lose. But companies also lose on the tax front too. With the plethora of deductions and credits, most companies pay less than 9% corporate tax. Not all, but most of the big companies. However, 999 makes compliance incredibly easy. So maybe companies will pay more, but their net costs (especially if you factor in owner’s stresses around tax time), make 999 a budgeting win in the aggregate.

            I’d also like to point out that, for the poor, the only reason they have such “low” tax is because they rely on a handout from the government in the form of a tax return. The bottom 40%+ of this country pay negative income taxes, and many in the bottom 20% are dependent on that return. You criticize the FairTax prebate because of its propensity to create dependence. What about the current system?

          • http://www.redstate.com/thesophist TheSophist

            What economic plan offered by a GOP Presidential candidate, or likely to be offered, would NOT be attacked as “YOU HATE THE POOR!!!BBQ!” by the Democrats and the media?

            For that matter, let’s suppose that the Republican nominee adopts Obama’s “economic plan” in its entirety. Would not the media and Democrats attack him/her for “WHY YOU HATE BLACKS!!!” and “WHY YOU HATE GAYS!!!” and “WHY YOU HATE WOMYN!!!”?

            I think overthinking the whole ‘winning message’ deal is what got Republicans and the country into the current mess (see, e.g., Compassionate Conservatism).

            How about we try the Reganite thing, toss out the pastel colored flags designed to convince the media/voters that we ain’t that evil, and try standing on principle?

            Tax on the poor? Yessirree indeed. So get off yer ass, get a job, stop getting divorced, and you’ll stop being poor. Is that too harsh a message? Is that a losing message in today’s political environment?

            Finally, since you care so much about the honest poor, I have an idea. Why don’t you take your additional income from having your income tax lowered to 9% and… I don’t know… give to a charity? Looking to government to take care of the poor and unfortunate amongst us is fundamentally un-American.

            -TS

          • Vaughn Harold

            paying higher tax rates are going to do, hoard the money. Some will help those less fortunate, some will invest into their business, some will pay their employees more, some will pay down debt, and some will innovate. Where the hell is the down side to letting people have more of their incomes? I can’t believe that conservatives are so concerned that a leftist agenda will mutilate this tax system. Like I said earlier, this tax system is already in place in multiple states and the fears that have been stated about the tax going from 9 9 9 to 29 29 29 or whatever are just unfounded. They are being used to attack Cain in order to promote their own candidate of choice.

          • avagreen

            What/how is the 999 plan going to do about that?

            I”ve asked 3 times now for the proponents to answer this question.

            So far…..nada.

            So, is the 999 fans just going to silently throw one whole generation under the bus? You know……those that kept us all from speaking German? Fought in Korea, Viet Nam?

            Need some answers here. Please?

          • Jim Tomasik

            ….

          • Vaughn Harold

            9 9 9 is simply a revenue plan, not a budget plan. Medicaid andSocial Security are all funded by the federal budget. Look at it this way the government brings in hypothical 1Trillion in revenue through any tax system, it’s up to congress to create a budget for how that renenue is appropriated to all the programs that the government runs.

          • avagreen

            if FICA (and it’s regulations as set by law) is done away with? Which is WHAT I read this plan will do. So,is it just a revenue, or will it also do away with programs? Can’t have it both wayz.

            FICA ( Federal Insurance Contributions Act), already has dedicated funds, laws in place, etc. Which will be eliminated, correct?

            Yeah, and waiting for Congress to appropriate money to fund the retirees? With new regs? Sure. I’m waiting to see that.
            Nice answer, but I wouldn’t bet on it. It’s one of those pie-in-the-sky answers I was talking about.

            What’s the plan? Comeon, Cain. Tell us the plan for dealing with this? I’ll tell you…..there isn’t one.

            If I’m missing the boat, fill me in. I see a lot of people’s future resting on this one issue, and so far all I’ve seen is nothing concrete.

            I work with these people. They depend upon what little they get. They can’t deal with someone in D.C. changing regs and funding pathways.

            I prefer the flat tax which already has a plan in place:
            “A 17 percent flat-rate consumption tax would replace income taxes and fund contributions to personal retirement accounts designed to eventually replace pay-as-you go Social Security financing.
            “http://www.ncpa.org/pub/st275?pg=8

          • avagreen

            That’s something I’d like for Cain to explain more fully, with charts and facts.

            Just saying the retirement issue “is built in” doesn’t help me sleep at night.

            Facts? Cain’s facts.

          • Vaughn Harold

            It’s your job to take care of yourself.

          • Vaughn Harold

            job to do charity work for others. There are those that cannot provide for themselves and by all means we as a nation should not stand by and not provide for their basic needs, but the federal government is not the vehical to occomplish this task, local communities are.

          • avagreen

            Where did you get this idea?

          • avagreen

            Hardhearted man.
            These people didn’t realize they would eventually run into people with your world views.

            They faithfully took the Government at their word and were reassured time after time they could count on the promises.

          • Vaughn Harold

            into, the lie was that the government can take care of you. Instead of saving their own money they gave it to someone who misspent it. I’m not hardhearted, another lefty talking point by the way.

            By the way welcome to the real world!

          • avagreen

            Why would anyone want to put their faith in the word of someone like you?

            I’ll take someone other than Cain and his followers if this is what you/he have to promise

          • Vaughn Harold

            any taxing system is used to pay for government programs. Since Social Security is a government program it would get funded with the revenue from the 9 9 9 plan just like it would get funded from the revenue from a flat tax plan, or the current garbage tax system that we have now.

            I don’t think that you get it. Your spouting lefty talking points that somehow people on Social Security are going to get shafted. Wake up, they already are get shafted because Social Security as it stands is unsustainable.

          • avagreen

            Tell the plan since FICA, the “Act” designed to administer this program is being demolished?

            Your words don’t cut it, just because you said so.

            So, now I’m “spouting lefty talking points” because I want to know the future? I think you are “spouting” Cain talking points, wanting to cover his mistakes, and yur blind obedience to him.

            For what it’s worth, he’s not a conservative, has flipflopped on issue after issue, so don’t call me a “lefty”. I’m a conservative and proud of it, have been for years. And, smart enough to realize when I’m being fed a line.

            Yes, SS is not sustainable. I preach that all the time, but Cain’s 999 isn’t the answer because of the lack of revenues to cover the existing seniors out there.
            The flat tax does it much better, but since it’s being proposed by someone not Cain, guess it’s not on your radar.
            Bah!
            Seniors should be taken care of as promised since 1935. Younger ones can build their own retirement (such as you), but for you to be so cavalier and call it “charity” to expect this to happen just points to your own lack of understanding.

            Cain’s plan does not work. Period. Quit covering for him.

            Lack of revenues + happy promises and empty words = seniors left in the lurch.

            The flat tax is the way to go.

          • avagreen

            of how Seniors will be treated by Cain and his followers. Such hard heartedness and false labeling to boot.
            You’ve put it out for the whole world to see.

            Cain, his followers, his plan are not to be trusted nor believed.

          • Vaughn Harold

            that any plan would pass congress that didn’t take care of obligations that the government owes to people.

            I’m not covering for Cain, however you are doing nothing but spouting out lefty, scare tactic, taking points to attack Cain’s plan because it’s not a flat tax.

          • avagreen

            I haven’t read any of this on a lefty site, I’ll have you know.

            These thoughts/concerns come from my own brain, and from the population that I’ve worked with for over 20 years.

            But, comfort yourself with your (false) thoughts and whatever shield you’ve put up from the reality. You can’t back up anything you’ve said with facts, just statements you concocted.

            Yes, Congress passes laws all the time that don’t take care of its obligations to the people. More pie-in-the-sky thinking on your part. What do you think will happen when the funds dry up? Just act as if nothing has happened?
            They’ll have to pass some kind of law to make it legal to not pay seniors what they’ve had in the past.

            And, you call me a “lefty”? Where have you been for the past almost 3 years?

          • avagreen

            I haven’t read any of this on a lefty site, I’ll have you know.

            These thoughts/concerns come from my own brain, and from the population that I’ve worked with for over 20 years.

            But, comfort yourself with your (false) thoughts and whatever shield you’ve put up from the reality. You can’t back up anything you’ve said with facts, just statements you concocted.

            Yes, Congress passes laws all the time that don’t take care of its obligations to the people. More pie-in-the-sky thinking on your part. What do you think will happen when the funds dry up? Just act as if nothing has happened?
            They’ll have to pass some kind of law to make it legal to not pay seniors what they’ve had in the past.

            And, you call me a “lefty”? Where have you been for the past almost 3 years?

            Apparently, your loyalties are completly with Cain and this 999 plan.
            Ever hear of projection?

          • http://www.redstate.com/thesophist TheSophist

            First, there is literally nothing that can be done to “save” SS on the revenue side. Everyone recognizes this, even lying Lefties who claim Republicans want to kill the old people. They all recognize the system needs fundamental reforms (private accounts, raised age requirements, something).

            So I don’t look to a revenue plan that is focused on generating growth to answer the FICA/SS/Medicare questions.

            Second, having said that, I’m comfortable waiting to see what Cain puts out vis-a-vis entitlements. As far as I can tell, no one in the field (including Obama) has put out anything resembling an actual PLAN dealing with entitlements. They’ve put out ideas, and they’ve said things like, “We like the Ryan Plan”. I’m good with that for all candidates for now.

            Generally speaking, if “conservatism” has now transformed into, “We’ll take care of you old people better than the Dems can”, then I really don’t see any reason for hope.

            Seems to me that Rubio ran in Florida, and won, despite telling old people they can’t keep getting government goodies. Seems to me that Christie in NJ told the people the TRUTH, and the people responded like adults. Seems to me that every “plan” from our side with respect to SS has said that those who are currently relying on SS won’t be cut off. Even Cain himself said so on various occasions.

            So… seems to me your hyperventilating is just that: hyperventilating. Relax. Give it a couple of weeks. See what everyone has come up with.

            But as Jim Tomasik has said, 999 is a revenue plan; funding SS or whatever other giveaways is not affected by it.

          • thirstyboots

            I have a little more trouble understanding why would a conservative dislike it.

            Apparently now that the historical record has been set straight it’s because the Democrats won’t like it. Which, unless I’m missing something, implies conservatives should limit themselves to make proposals that democrats like. Huh…

            I have little patience for economic obscurantism. The corporate income tax is also highly regressive (and hurts mostly low paid workers) and nobody seems worried about it.

            More importantly: if you want to have a progressive fiscal system the best way to achieve it is not through a progressive taxation system.

            Use the less distortionary and more efficient taxation structure possible and then use the other side of the fiscal system – transfer payments – to achieve progressiveness. This is the most efficient, elegant solution and the one that promotes the creation of wealth, jobs and fairness.

            If we’re going to give up those things because the democrats don’t agree with us and the public may be in their side because it’s the intuitive solution, we may as well quit now.

            The idea that conservatism shouldn’t defend the correct and best solutions because the other side can demagogue is at the root at America’s current problems.

            Time to man up – consumption taxes are better than income taxes and steering the tax structure into this direction doesn’t affect the progressiveness of the overall system.

        • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

          Was Reagan’s plan a failure since it only lasted 25 years?

          Would Fair tax ensure the second Coming of a Garden of Eden that never ends?

          It would be better for conservatism if no significant segment of the movement is only for plans that will guarantee perfection for a century or more and that don;t pretend that a FAIR Tax or modified Flat Tax would.

          We are not Europe. The analogies don’t work. See my comment above to streiff.

  • Jim Tomasik

    It is very well written and offers a reasonable look from the opposing view point generally expressed on the front page.

    I hope the moderators will consider it.

    • http://www.nighttwister.com NightTwister

      I agree with you. It’s a very good diary promoting the other side of this conversation.

      • http://www.redstate.com/thesophist TheSophist

        Reasoned civil disagreement is the path towards proper vetting, debate, and informed decisionmaking.

    • nick2253

      +1

      Great diary (and I happen to agree with it!)

  • Common_Cents

    Cain has to show it makes sense in order for 999 to be considered.

  • barleycorn

    Great job, thanks for putting a lot of effort into producing this. Well reasoned and well written arguments are hard work.

    I need to better understand all the ramifications of 9-9-9 before I know whether I support it or not , however most of the criticism of it I’ve read is both shallow and illogical.

    If something is broken as badly as our current system is, it borders on superstition to reject out of hand a plan such as 9-9-9 simply because it has (BOO!) a “new” tax in it.

    As you point out so very well, if the main objection is “Congress will mess it up” then no plan would ever pass muster. Congress can mess up anything.

  • lineholder

    late yesterday afternoon, Cain has already had his 999 plan scored by economists. He’s preparing to release that information to the public. When that takes place, then perhaps we can actually take a look at the details.

    I do find how some people are responding to the whole scenario somewhat ludicrous. They talk about Cain not being a “true” politician, as if this is something that the man should be ashamed of. That’s correct, he isn’t a typical status quo politician. He hasn’t become entrenched in the corrupt-inside-the-beltway-attitude of politicians where little is expected, much less to strive for major changes, even when they’re needed the most.

    He hasn’t taken the traditional approach that a status quo politician would have taken in trying to address the economic issues. He’s taken tools that he has learned from his business experience, such as Pareto analysis (i.e. focusing on the significant few issues like tax reform) and applied those to the our country’s economic crisis for the purpose of bringing about long-term changes that might stem the tide of our nation’s economic woes.

    Earlier this year, at times when Republicans were in a position to bargain for spending cuts, many voices here complained about how Republicans set their beginning bargaining level too low, leaving themselves little to work with. Cain is shooting high, much higher than any of us might have expected…so high that is seems unrealistic to even consider it in comparison to what we’re accustomed to. If people want to see that as being naive, so be it. But I can appreciate that he’s aiming high rather than merely placating or settling for little from the get-go.

    Oh, I’m definitely lower than a lot of people here at RS are in regards to the politician awareness/knowledge spectrum, and I don’t deny it in the least. According to some, that apparently means that people like myself are apparently just too ignorant to discern what the issues are and which ones matter the most. Ignoring the fact that this comes across as a bit of elitism, there are a lot of people like myself out here who can and do recognize what the big issues are and when common sense is being used to try to tackle those issues. It’s one of the reasons that we’re inexplicably drawn to Mr. Cain, (other than him being the anti-politician in the race) because he’s not afraid to take on the big issues and he does it in a common sense manner.

    • http://www.redstate.com/thesophist TheSophist

      And I’m with you, in the sense that I really wouldn’t mind Cain’s plan being examined left, right, backwards and forwards by economists, serious thinkers, smart guys and gals, and the rest of it. I’d like to know the devil that is in the details too.

      I just felt that the “he can’t get it passed” and the “Congress will corrupt it” arguments were seriously flawed.

      FYI, when you say, “I’m definitely lower than RS people in political awareness”… well, that’s 99% of the public. And probably 3/4 of the GOP primary voter.

      You know what I love about Cain? That he doesn’t pretend to have all the answers. I just read in the WSJ that he was asked some question about how his plan would apply to a PC designed in the US, assembled in China, with parts from Malaysia… and he said, “I have no idea”. That’s exactly right. I’d have been disappointed if he pretended to know the answer to that.

      The guy resonates because he’s a regular guy, more or less. He’s not a demigod like Romney. I hope he keeps that going.

    • Matthew Morris

      It?s one of the reasons that we?re inexplicably drawn to Mr. Cain, (other than him being the anti-politician in the race) because he?s not afraid to take on the big issues and he does it in a common sense manner.

      The surging of Cain in polls is absolutely fascinating. For a while, everyone heard “but he has no political experience, he has never been elected, he is not a serious candidate, he has no funds, he has no fundraising network”, etc. etc. And so he started out and for some time remained a 2nd/3rd tier candidate. And those “in the know” might comment on Cain as such: “He says some cool things, but since we all know he is not electable and can not be the nominee… on to candidates X, Y, and Z for some serious discussion.”

      I always imagined that when enough Tea-Powered-People looked up, looked around at each other, and said aloud, “Hey, I actually REALLY like this guy- I really want him to be my number one- but I was told he couldn’t be. But actually, why the heck not???!”…

      That there would be a big BOOM: The seemingly inexplicable, emergent phenomenon occurs-The Rising Cain. The regular folks out there see what is at stake every day- and they see what could be possible with a Cain Presidency platform.

      Think positive for a moment: Can you imagine what such a platform could accomplish? Starting with the economy- and ending with our collective culture- and everything in between. You can try, but you can’t even begin to imagine, really.

      My only prayer is that he can relax, stay collected, strategic, and unflappable- and avoid major unforced errors and gaffes.

      Now to make myself feel extra positive for the rest of the day, I am going to imagine the following:

      *Cain / Perry for 8 years (Yes I think Perry should be willing, and I would be more than happy with Perry / Cain- I want the two to mend their fences.) The really BLACK black man and the necessarily-racist TX governor together? Both brave, conservative, and outspoken? Pure Statist Crytponite for 8 years.

      Followed by Perry / [an even more seasoned] Rubio… wow.

      * strong supporting or Cabinet roles by other big names (Newt, Sarah, Bachmann, Ryan, etc.) where fitting.

  • ajshea

    I don’t see anyone talking about this, or the fact that Cain says right on his website that 9-9-9 is the first step towards eliminating the IRS and going to a FairTax sales/consumption tax. http://www.hermancain.com/999plan

    I really like that Cain says he wants to educate the American people on his plan so that they will demand it. That is leadership, something we see very rarely from Pennsylvania Ave.

    The beauty (to me) of a sales tax in place of the payroll tax is that an increase is instantly visible and the pain instantly felt. Whereas increases in payroll taxes really aren’t noticed so much.

    I think the 9-9-9 plan, if implemented, will be hard for Congress to sneak in changes. Its easy to keep track of 9-9-9 and notice when it gets changed.

    I like the idea of the FairTax, but I want to see it implemented in at least one of our 50 experiments in democracy for four or five years before we take it national. South Carolina may be the first, lets see how it works.

    (I say that not because I see problems with it but because I don’t — a decade ago I thought that universal healthcare enrollment was a good idea. Now I know better — I realized its folly before RomneyCare, that just proved how bad it actually was.)

    • wacowboy

      Rick Perry always talks about the states as being “Laboratories for Success”. The 9-9-9 plan sounds great in theory…why couldn’t a state adopt some form of it and see how it goes before we implement such a plan nationally. I think that those of us who are uncomfortable with what congress would do to such a plan might feel more at ease with it if a plan had a track record of sorts.

      in addition, it would seem that the best way to solve the tax code problem is to study the 50 different ways the states conduct their taxes and judge the merits and demerits of each and base whatever national reforms on what works in the states.

      • nick2253

        Furthermore, what works in one state won’t necessarily translate to the entire nation. Two examples: Romneycare and No Child Left Behind.

        Now, I believe that Romneycare worked well in Mass. Prior to the bill, they already had really high percentage of citizens insured, and so the bill wasn’t too onerous. I disagree with the mandate, but I believe the state was well within their right to mandate it. Now, Romneycare and Obamacare are actually quite different (having read the bills, and can atest to that). Nevertheless, Obamacare was based on Romneycare, but given the difference between the national environment and the Mass environment, the idea that ideas from the latter will work in the former is just ludicrous.

        Same with No Child Left Behind: what works in Texas will not always work on the Federal Level.

        I think that the same thing applies here. Every state has a property tax (something the Federal government doesn’t have), This makes sense because the state provides features to those who live there, but in our ever-connected society, people can do business all over the US with ease. By taxing property, you are ensuring (for better or worse) that you are actually taxing residents. The federal government, on the other hand, needn’t be as concerned with that, as the cross-border business between the US and international countries (for individuals, at least) is much smaller. With companies, it’s obviously a whole different story, but that’s why the corporate tax code is set up as it is.

        TL;DR – A state isn’t necessarily a good laboratory/representation of the Federal Environment.

    • windwaker24

      There will be an IRS, whether there is a Fair Tax or a Flat Tax. There are two parts to the IRS: compliance enforcement and collection. To abolish the IRS completely, the government would have to get out the revenue collecting business all together, which is never going to happen! Cain’s plan will increase the compliance enforcement side of the IRS (probably the collection side, too) because of the new avenue of revenue (the sales tax), meaning more RAs (Revenue Agents) to make sure people are administering and collecting the sales tax properly on top of income tax and corporate tax compliance.

      Remember the big brouhaha over the individual mandate enforcement in Obamacare? The IRS asked Congress for additional funds to carry out the law. The Republican-led Congress turned them down. The IRS is still trying to figure out what to do. There are currently not enough agents to deal with the individual mandate provision, which is good for us, but devastating for the government. Every time you add an additional source of revenue to the government, you must increase agents and departments to ensure compliance. People are not angels. I know an RA, and you will be surprised how people come up with different ways to cheat and hide, even on the simplest of thngs.

  • whitfox3

    Yes, there are many advantages to tax simplification, and reducing taxation on production. But when did the Republican party become the party of higher taxes? This bill clearly raises taxes for over 50% of households. Judging from how it impacts me and my income, I estimate it’s more like 75%.

    If we’re going to go for class warfare, I don’t like being on the minority side. Despite all of Cain’s great points, I believe this plan is the most likely to re-elect Obama.

    • nick2253

      Currently, 47% of people pay no income tax. However, everyone pays the highly regressive FICA. In fact, when you look at all federal taxes as a percentage of income, the average tax payer pays around 23%, with the five quintiles paying (in order from lowest to highest) around: 5%, 10%, 14%, 17.5% and 26%.

      Assuming that everyone spend 100% of their post-tax income on new goods, then yes, the bottom 80% of Americans would have their taxes go up.

      However, the truth is that most people do not buy 100% new goods, nor do they spend 100% of their money. Rent won’t have a sales tax associated with it. Utilities won’t likely have a sales tax. Used goods won’t have sales tax, such as used cars, used furniture, and in general anything second hand. And most importantly, saving and investing won’t have a sales tax associated with it.

      For the average family, most of their money goes to rent and utilities, followed by groceries. Since farmers markets will likely be exempted from sales taxes (IIRC, all states do so), this not only encourages people to buy locally grown foods, it means the sales tax won’t necessarily affect everyone.

      • damianvincent

        except poor people, Middle class has been tapped for years, over leveraged on credit card, but of course no one really spends 100% of their money. Come on now, Cain’s plan is going to be a huge tax hike on the poor and middle class in a very visible way that will crush the GOP. We’ll lose the very next election in an landslid handing the Dims a mandate to rewrite the tax code from the ground up.

        • Doc Holliday

          assuming these so called poor people want jobs, they will have a booming economy if Cain’s plan is enacted. You people can focus on the (*&^ sales tax and ignore the totality of the plan if you would like, but you are doing yourselves and everyone else a disservice.

          I think a these are not Mitt Bots, I think these are Perry folk who are pulling their hair out because he is doing so horribly. Everyone wants to pile on the guy in the lead I guess.

          I don’t think the 999 plan is magic, but it is not the devil as Bachmann implied. Our goal should be to unseat Obama and reduce the overall tax burden. I am sure Cain’s plan will be adjusted in Congress, I am also sure we need to start somewhere. I respect a man who puts his views out their for ridicule, not those who hide behind generalities and more of the same.

        • lineholder

          It would be difficult to overcome some obstacles in a legislative context, but if we the people do our jobs next November and elect Conservatives into office, we’ll have a bit more muscle involved in it than we do now.

          If it succeeds, we’ll win the election following this one because their will be an overall increase in financial conditions.

        • nick2253

          If you’re talking about my data, you can take a look for yourself here:

          CBO 2006 Tax Data

          The BLS also publishes data on spending habits:

          BLS 2006 Spending Data

          I’ve included the 2006 versions to compare apples to apples. The BLS updates every year, but the CBO doesn’t, so 2006 is the latest CBO data I could find. Be warned that the BLS uses some strange numbers for income before and after tax. I believe they pre-deduct FICA in the “income before taxes” entry. You’re best off using the tax data from the CBO (that way you are looking at only federal taxes; the BLS also looks at state taxes), and combine that with the spending from the BLS.

          Lets look at the middle quintile. According to the CBO, we have an income of $60.7k, and a tax rate of 14.2%. This becomes $52k after federal taxes. People then spend about $41.4k a year. This leaves about $11k either for savings or for state/local taxes.

          Under 999, this becomes $55.2k after income taxes. Assuming that the 9% was applied to 100% of spending, then you’d have $45k in spending. This leaves just over $10k for either savings or for state/local taxes. However, that 9% will not apply to all 100%. If we discount spending on just housing and utilities, then our spending becomes about $30k a year + $11.4k for rent and utilities. Now, after tax, our spending is: $44.1k a year. This leaves us about $11k either for savings or for state/local taxes.

          Now, if you actually go through that list, and pick out the goods and services that won’t be taxed, as well as the embedded taxes that won’t be compounded by 999, you’ll see that your tax savings will be even greater. Even in my back of the envelope calculation, an over-exaggerated 999 does no worse for the middle quintile than the current tax code. Even if the middle quintile lost an additional $1k in income, that would amount to a mere 1.6% increase. But again, that won’t happen, because the sales tax won’t apply to everything.

          You can do the rest of the math yourself if you want to. You’ll see that 999 doesn’t increase taxes as drastically as you predict. Until you do the math, stop making sweeping generalizations that are blatantly untrue.

      • whitfox3

        When you start making major sales tax exemptions, it’s not obvious how this stays revenue-neutral. Given our massive deficit, I don’t see us reducing the net tax burden below the current 18% of GDP anytime soon. If income taxes are dropped to 9%, doesn’t the 9% sales tax have to be pretty global?

        And if just the lowest 3 quintiles see taxes go up, that’s a 60% majority losing in the deal.

        • nick2253

          I mean, first off, you can’t have a revenue-neutral tax plan that makes everyone winners. A revenue neutral plan that lowers taxes on some with by definition raise taxes on others.

          Based on my understanding of the plan, 999 will not be revenue neutral. My personal analysis estimates a cut of revenue in the neighborhood of 25%. AKA totally not feasible. However, I am just doing this on my own with data I find online, so there are no guarantees that it would be true.

          Also, based on this analysis, I believe that the biggest increase in taxes will be for the bottom quintile and companies. The second quintile will see an approximately neutral tax rate, and the top three quintiles will see their tax rates go down.

          One of the biggest losers under the 999 plan would actually be businesses. Now, most companies pay rates that are close to the statutory rate, but many of the largest companies pay a much lower rate because of all the deductions and credits (see GE). You also have companies like PepCo, Prudential, and Boeing that, in 2003, paid negative income taxes. All these companies would, under 999, be paying 9%. Basically, 999 would convert the corporate tax structure from an effectively regressive one to a flat one. Even though the statutory rates are progressive, many of the most lucrative loopholes, credits, and deductions were placed in the tax code by the large companies, specifically for their benefit, through lobbying in DC.

  • trapperjohn

    I like Cain but I’ve been uncormfortable after reading criticisim of the 999 plan.

    I’m a little more comfortable. I especially like the point that without a balanced budget amendment, and without a much more conservative congress we are screwed anyway.

    I’ll take Cain, Bachmann, Perry, and even Romney if it comes to that. In fact, I’ll vote for whomever wins the primary. But Cain does make me feel a little better than most of the field.

  • Doc Holliday

    1) I think the number of people on the right attacking Cain’s plan is very close to the number of people on the right supporting another candidate.

    2) Many who are attacking Cain’s plan, defended Perry’s in state tuition for illegals plan.

    Disinterested pollsters are showing Cain rising because of his plan, and Perry falling hard over his plan. We can argue why they are right or wrong, but we can’t argue that it is happening.

  • runner12

    of the 9-9-9 plan. I did not find a compelling argument as to why this would not be morphed into a monster. Correct me if I am wrong, but the main argument was that the other guys’ plans could be morphed too. Which at face value is true, but that still doesn’t help this pesky question regarding Cain’s plan.

    Until we get a BBA and really reign in spending and entitlements, reforming the tax code will be an exercise in futility. It will be trying to heal the wound from the outside in versus the inside out. The reason being is that if the spending remains out of control ANY tax reform plan will be gamed to get more money.

    Pass the Ryan Plan or something even more radical and then we can talk tax reform. I would rather candidates focus on how to reign in spending, reform entitlements, limit government, and create jobs rather than tax reform.

    • http://www.redstate.com/thesophist TheSophist

      (1) Cain supports a balanced budget amendment. He was among the first to sign the Cap, Cut, and Balance Pledge.

      (2) The Ryan Plan is hardly radical. Those who suppor the Ryan Plan but attack the 999 should probably explain why they favor the first and hate the second, given that the Ryan Plan was extremely moderate in its ambition.

      (3) Reforming the tax code is hardly an exercise in futility. I’ve already noted the enormous compliance costs of the current tax system. That alone is $380 BILLION a year that can go towards things like capital investments, new hiring, inventory, and expansion.

      There’s a second impact. Taking the corporate tax to 9% from the current 34-39% for companies with more than $75K in annual earnings has an enormous impact. For example, a midsize company with $10M in earnings would see its tax burden go from $3.5M to $900K.

      That extra $2.6M will either be reinvested in the business, or distributed to owners (who will then spend it on things like new homes, new cars, the lawn guy, etc. etc.). However you dice it, we’re talking economic growth here.

      Maybe the additional hundreds of billions in economic activity in the private sector is unimportant to those obsessing about a national sales tax… but to the millions of people who might find jobs after two long years of Obama… I rather think it would be important.

      Tax cuts and tax code simplification worked to grow the American economy when Reagan did it and when Kennedy did it. Why wouldn’t it work if Cain does it?

      • runner12

        will collapse rendering any plan moot.

        I never claimed Ryan’s plan was radical, hence the suggestion of a more austere plan. I will also add that neither Reagan nor JFK were facing the crushing debt we are today. It is like comparing apples to oranges. In fact, this is one area neither of them were able to address. This is partially why we are in this mess today, Obama just sped things up to a crisis.

        I think it is great Cain supports the BBA, but he is not touting that. He is touting 9-9-9.

        Tea Party stands for “taxed enough already.” I cannot support creating another revenue stream until Washington can demonstrate that they can cut spending and reform entitlements. No matter how much some Tea Partiers like Cain, this fact does not change. That is why I think some of us are wary of this plan.

  • damianvincent

    999 is the largest tax hike on the poor, probably ever. It is extremely regressive shifting much of the tax burden down. That dog will not hunt. Obama is already playing the class warfare card, what are we going to do serve up a candidate who’s plan is to hike taxes on the poor?
    Secondly 999 opens a new form of federal taxation, can you imagine if the Democrats like Pelosi had a national sales tax to tap in their spending binge, it simply makes me shutter thinking about it.

    • http://www.redstate.com/thesophist TheSophist

      So we should compete with Democrats in handing out goodies to “the poor”? Sure, that’s worked so well for us in the past with things like Medicare Part D.

      I mean, since Obama is already playing the class warfare card, we should go along with his game plan? Whatever would we do if Obama proposed a 99% tax on everyone making over $250K in the name of helping the poor? Propose that we only tax them 75%?

      If THAT is what we’re fighting for, hell, you can count me out. What’s the point? Let’s just all go join #OccupyNarnia folks and speed up the collapse.

      Or… we could act like conservatives, rhetorically punch Obama and the rest of the Class Warfare Trustafarians in the mouth, and make actual arguments against socialism and in favor of capitalism.

      • damianvincent

        Capitalism, how about the fact that 2/3 of our economy is consumption based, and Cain’s 999 plan has a huge consumption tax restricting the main source of economic activity. How does that make sense ? You can’t be foolish enough to not know it’s political suicide to lower taxes on the rich, and jack them up on the poor, especially during an election. Since when do Conservatives support jacking up taxes? I don’t support hiking taxes on the rich, and I damn sure don’t support hiking taxes on the poor.

        • Change Jar Conservative

          are

          a) tax people who don’t pay income tax currently. This would IN THEORY (and I’m not sure I buy that theory) make those people more likely to want a smaller government.

          b) shift taxes away from the cost of making US goods and spread that tax burden onto products from the US and around the world. In other words, it lowers the cost of US goods versus goods make elsewhere in the world.

        • http://www.redstate.com/thesophist TheSophist

          as you’ve put it, if the result is that every citizen has some skin in the government game.

          Under your logic, that we ALWAYS oppose ALL tax increases, we all should be very very comfortable with the fact that nearly half of the American people pay zero in taxes. Why not let it get to 60% of the voters not paying a dime for government?

          Tocqueville said that the greatest threat to democracy comes from the people realizing they can vote themselves money from the public treasury.

          The more conservatives act like moderate Democrats, the more we will lose. To say that speaking reality and truth to the American people is political suicide is willful ignorance of what happened to the GOP during the “Compassionate Conservatism” era, as well as what’s happened to advanced democracies in Europe once the “Right” became soft-Left.

          At the end of the day, are we working to get Republicans elected and conservative ideals advanced in order to get more Republicans elected? Or to save the country?

  • rightwingmom52

    is that if we keep issues like tax reform, social security reform, healthcare reform (after repeal of Obamacare), etc., front and center, and then send a conservative to the WH along with more conservatives like those we did in 2010, we can claim a clear mandate to enact legislation to address those issues. Elections have consequences.

    Whether it’s 9-9-9 in its current state or a tweaked version or a pure flat tax or whatever, Cain has folks at least talking about tax reform, and that’s a start. Further, if Cain were to make it to the WH, Congress would be hard pressed to ignore one of the primary issues upon which he’s hanging his hat.

    • http://www.redstate.com/thesophist TheSophist

      Plus, I just can’t understand the idea that we’d work our tails off, give people our hard-earned money, and only send a Republican to the White House. Hell no! I will do what I can to ensure that we increase the number of Tea Party conservatives in the House and the Senate.

      The mandate from the voters would be big enough that even the New York Times might have to admit to it.

      This is especially true if the nominee is Cain, for the simple reason that he’s a total novice in politics. With a Romney or Perry (both good men, both better than Obama), one could argue that it’s politics as usual: a big-name governor got the nomination to make incremental change. The message of 2010 should have been that we the people are pissed off, and that no one is safe no matter how long his residence in Incumbentistan (see, e.g., Mike Lee’s win in Utah). Should Cain win the nomination, and then the election, that message will be amplified exponentially.

      It will have the same impact as a team changing the star quarterback in mid-season: none of you are safe. All of you had better step up and start doing what we want, or you can grab yourself some pine there, son.

  • californiagold

    What makes you think Herman Cain will even get his plan passed in a republican controlled congress ?

    Grover Norquist was on TV yesterday and suggested that it won’t matter on this issue which republican wins the white house, because major tax policy legislation will be written by Boehner and Mcconnell, leaving the president to do nothing but sign it.

    • http://www.redstate.com/thesophist TheSophist

      Consider, you’re John and Mitch. You just saw your guy Mitt, the Establishment choice, the Next In Line, go down to a frikkin radio talk show host who has never held office before.

      The only way that could possibly happen is if the GOP primary voter base is absolutely dominated by “Tea Party hobbits” who are sick and tired of the games played in Washington DC.

      Your new President is the guy who ran on the 999 Plan, and convinced 51% of the GOP voters, and then 51% of the American people to choose him.

      Do you really want to ignore all of that and just write some tinker-at-the-edges kind of a plan that would appeal to Minority Leader Reid? Really?

      • damianvincent

        neither one of them would get re-elected if they introduced a new form of taxation upon the American people.

        • http://www.redstate.com/thesophist TheSophist

          Cain would lose the nomination.

          If he wins, and then wins the General, you have to start admitting that the GOP base and the American voter wants exactly what Cain is selling.

          If they understand it, they will demand it.

          Go against that at your own peril if you’re a Congresscritter.

  • Matthew Morris

    Faced with choosing Obama and more of the same or Herman Cain, 999, “raising taxes on the poor”, and so on- I bet a surprising number of voters bite the bullet and vote to put their own skin in the game.

    With EQUAL skin in the game for all, along with transparent taxation, what makes all you 999 / FairTax detractors so confident that it will be business as usual when it comes to politicians hiking rates, rigging the system, etc? The dynamics would be so fundamentally different- you are failing to even begin taking this into account. Jesse Jackson will have to resort to calling tax increases racist.

    Of course he will also do this pre-999, but that is a given. I am not too sure how real the opportunity is to fundamentally transform our tax system to something by nature fair and equitable. But will there ever be another chance as good? Who better to push for it than someone like Herman Cain? Because if we don’t make that transition- then we are screwed anyway.

    So if it fails- 4 more years of Obama maybe. We might not make it through those remaining 4, but then again, without change we aren’t going to “make it” in any reasonable sense anyway.

    But after 8 years of Obama, Cain and 999 would surely win in a landslide in round 2.

    (substitue Perry w/ FairTax if so desired- although I think Cain alone has a unique ability and opportunity to make a connection with the “poor”)

    • damianvincent

      people are not going to vote to raise their taxes, this is like the twilight zone since when did being a Conservative mean supporting new forms of taxation, and jacking up tax rates on people?

      • Matthew Morris

        Conservative = same rates for all, same rules for all.

        Since you can’t very well bring the rates of the wealthy down to 0%, that leaves you with the option of “raising” taxes on the untaxed to match levels of everyone else. It can’t stay that way forever- so when is the better time to fix it?

        • damianvincent

          Are you kidding, you don’t know if I’m serious? Being a Conservative means you support reducing the tax burden, on not just rich people, but everyone, and lowering the size of government. Not hiking taxes on those who can least afford it, with a brand new form of taxation. That’s something a ultra lefty would propose. Can you imagine if the dims had a national sales tax to tap in their 6 trillion dollar spending spree? I support things like the Ryan plan of removing all the loopholes, and lowering the rates, I understand the concept of getting more people with skin in the game, that’s a gradual process not a knee jerk tax hike, that also really ignores that there are taxes on everything, fees, and the like, state, federal, local, and the poor pay for those as well, with the nonexistent budgets they are scrapping by on. As a life long Conservative, I’ve never herd anyone in the party before now, advocating raising taxes, especially on those who can least afford it. It’s a bad idea, not to mention political suicide. The country is in shambles, people are out of work, and scraping by by the skin of their teeth, and we want to raise taxes on them. Worse than that, is that this would a brand new form of taxation on the American people, coupled with state sales taxes in my state, it’ll increase the cost of every purchase I make by almost 20%. That won’t sell to a majority of Conservatives, nor 10% outside the party.

  • Scope

    and helps the higher income brackets. The Dems. will have a field day with this as just another tax cut for the rich.

    A fair analysis of the 999 plan

    • Vaughn Harold

      as a result of the lower business taxes. This whole VAT thing going on in Europe does not seem to be happening at the state level here in the US where this same tax structure is in place. I would also think because of the VAT over in Europe and how it is effecting their economies would be a deterant here in the US. No way to know, but this I do know, conservatives will fight like hell to make sure that it does not happen here in the US. Of coarse like the article points out, cutting spending has got to happen, and the only way that is going to happen is to transfer the social programs back to the states and local communities where they belong.

      • streiff

        it is a matter of philosophy if you support a progressive tax system but this is a very regressive tax proposal.

        • Vaughn Harold

          to me that the 9 9 9 is a neutral or flat tax system. To me the term regressive is only being used to scare the poor, something that I thought conservatism wasn’t into. The poor are never in a place to earn enough to take care of there own basic needs, hence the need for charity. It seems to me that this system would allow individuals, not the government, the ability to help take care of the poor. How is this a negative?

          • Justin Spagnolo (standardcandle)

            … I mean people 65 and older that already own the home they’re going to retire in… well they’re free and clear aren’t they?

            But If as a young person, I’m looking to buy a home… that’s a whole new set of taxes I have to worry about on top of my down payment….

            I believe complex issues don’t always require complex solutions, but I think its a bit simple minded to assume that a consumption based tax is neutral. By definition of consumption based, its not neutral.

            Because you don’t “take care of the poor”, if you want to be charitable you give them opportunities to take on risks and grow out of poverty. Something you can’t do if your facing inflation on a tight budget… Do you really think a national sales tax will lower the cost of the supply side? Especially if a VAT is added later to deal with “black market” offenders?

            I think a national sales tax actually is regressive… one of the biggest problems American Capitalism faces is the fact that there is a lot liquid out there sitting on the sidelines, trying to avoid risk, how does putting a price on consumption get those dollars back into the system? Just because we’re promising a lowering of taxes doesn’t mean the margins work in favor of the “hand up” to the lower to middle class folks that are trying to climb that hill… Much of what is gained in liquidity is done by interest and investment in sweat equity of someone else that is willing to take on the risk and provide a return to someone that will risk on the equity of the development and implementation of the idea. America works because we borrow to bet on ourselves and each other… If we don’t look for ways to both make and spend money on our own accord, rather than allowing government to confiscate our gamblin’ cash so they can come up with a new entitlement… then eventually when the luck turns sour we as a country are prone to deficit growth.

            999 is a numbers game, it doesn’t grow the base of revenue contributions, it lowers the revenue contributions all together… and it assumes that there will be “shovel ready” capital opportunities vs. “shovel ready” infrastructure opportunities.

            This does NOTHING to lower our SPENDING issues and its the SPENDING that is KILLING JOBS…

            In my view the Laffer curve is just as applicable to 999 as it is to TAX TAX TAX the rich, it’s just on the opposite end of the curve.

            If you’re going to go for a consumption based tax… make it a FairTax and be done with it… Don’t try to artificially inflate the downside with an arbitrary income tax on business and individuals, only to give us a taste of “Shangri La” and leave me feeling empty… as if someone sold me a commie “Utopia” with a different label.

          • kcdude

            growing the base of revenue contributions, I think I disagree. I think a 9% rate of taxing business and a doing away with a payroll tax would definitely cause the base to grow. It may or may not grow the base from the sales tax perspective but folks would likely be in a better position to buy if they have more income. I do have several questions about the nuts and bolts of the plan. Regarding your house purchase point, I wonder if it applies to new housing and not existing housing purchases.

            Disclosure – I am undecided between Cain and Perry. Waiting on the Perry plan. At the end of the day – any conservative and not Obama – ACANO.

          • Justin Spagnolo (standardcandle)

            by eliminating the payroll tax and lowering the corporate tax rate to standard 9%…

            I understand the argument that “G.E.” would be forced to actually pay taxes rather than afford the accountants to reduce that cost for them…

            However, if I’m a small to medium sized business owner, and I’ve got multiple small business, where some are highly leveraged, and another is easily de-leveraged I think I could start getting creative with how I report my business revenues and income. I also would assume that since the majority of the businesses out there are small and medium businesses… this action may require growing the IRS for auditing purposes…

            I don’t disagree that 999 wouldn’t cause some private industry growth, but I don’t know if it will cause the kind of growth that would replace the revenues we have to bring in to meet our entitlements… This is where I believe Cain’s plan is weakest, because he admits himself that “of course we will need to reduce spending to encourage growth and get our fiscal house in order”… but we’re not talking about 2 sides of the same coin…. we’re talking about 2 sides of several coins that will have lasting and large ripple effects…

            The intent may be for good, but good intentions pave the way to hell… Cain I think isn’t being cautiously optimistic… it’s overly optimistic….and his plan is a very cavalier approach… the process would change many dynamics throughout our economy… that alone might cause confidence issues in every sector in every market while things are still shaking out. Ever stomp your brakes while throwing the steering wheel 180degrees at 65MpH how about 85MpH… how about 15MpH? WE NEED to FOCUS on repealing Obamacare first and foremost… then we need to Permanently Extend Bush Tax Cuts, Tax Holiday on payroll taxes, lower cap gains, and corporate taxes across the board, and start Slashing, Cutting, and Gutting the Regulatory Behemoths of our Federal Govt. while consolidating services, divisions, and utilizing technology to reduce government waste of all types of resources, including a restructuring of labor contracts and retirement and every other benefit that creates a bloc vote… There needs to be an audit of the Fed Reserve. We need a new Fed chairman that holds the feet to the fire rather than massaging those fee of the too big to fail institutions and ensure that TARP gets the supposed repayment that it was meant to be… right now it sure looks like a sunk loss capital failure… I think Bernanke meant it to be that way… “they’ll promise ‘we’ll pay it back’, we only take these extreme measures because of the nature of this one time situation… and then we’ll hope that nobody notices that taxpayers got stuck with all the toxic assets that Wall Street traded around the old maid card until it was stuck with Lehman Brothers and Goldman Sachs… ”

            We have to reform Entitlements, end of story… I’m convinced that nothing short of a Balanced Budget Amendment will help us do that… and if we don’t do that, no amount of cutting taxes will help us tread water or swim back to shore.

          • satchman3

            The poor have a lower (or negative) savings/investment rate which means that they spend a bigger fraction of their income exposing it to the national sales tax.

            This would lead to the result that the effective tax rate paid by the poor would in many cases be higher than the effective tax rate paid by the middle-class and wealthy.

          • streiff

            at lower income level you have less choice about the amount of money you spend and the 9% sales tax on top of a 6% or so state tax hit harder.

            Under the current system at a certain income level the EITC applies which essentially gives you a bonus for holding a job. So working results in 0 federal income tax plus about 2-3K transfer payment. 9-9-9 gets rid of this, adds a 9% income tax penalty plus a 9% sales tax.

            It is pretty easy to see how this is an extremely regressive tax. Again, it is up to your prudential judgment as to whether this is a good idea, but don’t pretend this will not be a huge negative in the general election.

          • acat

            9-9-9 as a regressive tax, and I don’t see how Cain can overcome it. This is handing the Dems an issue with which to beat him.

            However.

            The current scenario in which 45% or so of the population (ballpark) pay zero federal income tax, and where some percent that you mention get a form of welfare via the EITC is inherently unstable.

            I don’t like sales taxes because they’re inherently stealthly, and can be slowly ratcheted up over time. I do like that sales taxes hit 110% of the population – that is, even the illegals pay the sales tax.

            With the right safeguards in place – such as repealing the 16th – a sales (or “consumption”) tax with exemptions for medicines, medical treatment, and food – better balances support for the government.

            Yes, it’s regressive, but it’s socially more stable, and it may persuade some of the folks at the bottom rung to stop voting for bread and circuses on my dime.

            Mew

          • satchman3

            With 999, you pay 9% of your income in income taxes, then if you were to spend the remaining 91% you’d pay another 8.2% of your income for a total maximum income tax rate of 17.2%..

            There’s really now wa that paying 17.2% can replace the 15.3% payroll plus the 15-20% of AGI we pay. Even though payroll tax is capped at the high end and effective rates are much lower at the low end I don’t see how a flat 17.2% rate can possibly be enough – then if you start exempting stuff from the 17.2% it only gets worse.

          • Justin Spagnolo (standardcandle)

            We’re not going to ‘repeal’ the 16th…not before we repeal Obamacare… and trust me Iran and Israel are going to keep us very distracted in the next 5 years… as for the other safeguards all things that would be temporary… Also… on the consumption side.. what happens to the government purchases with exemption… they’re still exempt now… but the government gets their Discover card %5 cash back bonus award each time the government spends money and reaps at current corporate tax levels, because that money is pumped into the system, and then taxed again at high corporate rates… with a business income tax that goes flat… we lose a lot of revenue where the government reaps where others are sowing.

          • acat

            From memory, there was an excise tax, basically a sales tax on certain goods and services to fund one war or another.

            Finally repealed back in the ’60s or something.

            What I’d like to see is a larger pool footing the bill for the government, even if it’s only at a “nominal” level. See my proposal for an income tax “floor” – that is, an easy-to-calculate amount, 1% for instance, that no deductions or exemptions can get you out of.

            On $30,000, it’s $300, a pretty nominal amount and covered by the “welfare” EITC .. and on $1,000,000, the “floor” is $10,000 .. and I don’t see most people earning that kind of change having enough deductions to reduce their tax bill that far anyway.

            The “floor” would function to put “skin in the game” at the low-income working-poor levels, and would reduce (but not close) loopholes for very high income folk.

            Mew

          • arizonajohnson

            Federal excise taxs (or “FET”) are typically imposed on the sale of fuels, cigarettes, alcohol, ammunition, firearms, communications, air transportation, and just about everything else that the federal goverment regulates. Excise taxes are similar to a sales tax, but generally is a tax on a number of events or units rather than the price of goods sold. In short, the federal government already imposes taxes on the sale of certain goods and services very similar to a sales tax.

          • acat

            Some part of it was repealed, but .. yeah. It’s kind of insidious.

            This is yet another reason why I’m not a fan of Cain’s 9-9-9.. we’ll have sales taxes on top of excise taxes.

            Mew

    • defenseconservative

      It would not hurt any lower income brackets. It would, however, force those who currently pay nothing at all to finally start paying taxes like 53% of us Americans have to do.

      My beef with his plan is different:

      1) It institutes a new federal tax without repealing the federal income tax first.

      2) It is a mere figleaf designed to cover up the fact that Cain has dumped the FairTax.

      • http://www.rightreality.wordpress.com andysmith

        9-9-9 is meant to be a transition TO the FairTax.

    • damianvincent

      and a tax hike on the poor and middle class, out of work, stretched to the breaking point already.

  • mspector

    Cain has what it takes. He is winning people because he puts real and realistic solutions out there. His plan may be flawed, it will be played with, but it is a plan that if implemented as he presents it would be far superior to what we have now. OK, there’s the national sales tax issue, but that’s one of the things that will be debated and hammered out. That’s as it should be.

    Cain also threatens the GOP establishment to its core. He is a Tea Party guy with an expanding base of support whose ideas — and very presence! — are defining the political discussion. If he were the nominee it could spell the end of the domination of the Romneys and Roves within the GOP, at least for the foreseeable future.

    Liberal Democrats and the GOP establishment both fear Cain, not because he is not electable but because he is very electable. To the GOP establishment his campaign threatens the death of the country club. To the Democrats, his campaign threatens 50 years of myth-making and brainwashing. Put simply: Cain is a game-changer. It would be to the everlasting shame of the GOP if the party cannot embrace that.

  • Craigpennsylvania

    Let us start here:

    A VAT tax means “Value Added Tax”. This means that tax is added at each step of a process. For example, let us look at making a metal model car completely from steel and rubber, and that we have a 9 % VAT.

    The Raw metal costs $1 and the rubber costs $1. The VAT will add $0.18 to the cost. Now our cost basis is $2.18. The manufacturer needs to make a $3 gross profit.

    The manufacturer completes the car and sells is to the retail store for $5.18 The VAT is $0.47. The store’s net cost is now $5.65. The store needs to make $5 in gross profit. The retail selling price is now $10.65 plus the 9% VAT, which brings us to $11.61 final price to the consumer.

    With a sales tax, the on tax added would be $.90 on the final sale, leaving the cost to the consumer is $10.90. Cain is talking SALES tax, not VAT.

    NEXT … Tax reform

    ANY tax reform which sees rates for people making over $200,000 per year lowered to below the current rates will be attacked by Democrats.

    ANY Tax reform which will cause the 47% to pay anything in the way of taxes will be attacked by Democrats.

    IF we, as conservatives, are going to run from any program that Democrats will attack, then we should just quite Red State and join The Huffington Post.

    It’s going to take courage to tell the 47% that we expect them to pay their fair share of the federal government.

    The question is, how does one explain this to this 47%?

    It really is fairly simple, just be honest with this group of people. Explain that for every $100 they make, they get to keep $91. There are no games, no tricks. There are no higher tax rates to worry about. Want to make more? Simple, work overtime, and keep 91% of what you made.

    Show them that under today’s tax code, for every $100 they make, they lose $7.65 (remember, this is after January1, 2012) now, and their employer also loses $7.65, even if they pay no “income taxes” now.

    Explain how this new program will make it easier for companies to hire more workers because it lowers the company’s costs. People will like being told the truth. No, not all people will like this, but a lot will.

    Speaking from personal experience, I know that companies have to compete in order to get good workers.

    As a business owner, I know that other businesses will be looking at the elimination of the business’s half of FICA taxes, which will allow them to offer potential hirees higher wages than under the current system. I will have to increase the wages for my employees. This will not happen in the first week, but it will happen. This will merely be the free market at work.

    Senior citizens currently getting Social Security will continue to get it. Most seniors have other sources of income – dividends are especially popular. Show these seniors that they keep their current SS (My parents are 75 and 76 years young. They are big supporters of 999, a flat tax, or the Fair Tax) and that they will pay NO taxes on dividends.

    The regressive nature of this tax is not nearly as dire as is being suggested. As an auto dealer, I see all income levels of people looking to buy cars. Used cars will be exempt from the 9 %. People making $23K per year don’t buy new cars. They buy used.

    Show this person making $23K how to improve his/her life with some good old fashioned hard work and watch as the majority of people LIKE the idea.

    When that $23,000 individual is told he is paying $2070 in total taxes and that the guy making $1 million is paying $90,000 in taxes, it will be hard to explain to anyone that this is not fair. This will be especially true when the $23K guy realizes he paid no NST on the $4500 Used Taurus he bought, while the $1 million guy paid $36,000 in taxes on the new $400,000 Ferrari.

    With 999, even a drug dealer buying that Ferrari becomes a tax payer. So does the guy who inherited $50 mill and is earning $3 million a year in tax free muni bonds. Point THIS out to people.

    We keep hearing from Obama that more people need “skin in the game”.

    999 goes a long ways towards getting EVERY American having “skin in the game”. It also makes for a logical approach to the idea that “The more you make, the more you pay”. People will appreciate this over the current “The more you make, the more you pay, unless you can afford REALLY good accountants like GE can, which means you pay nothing.”

    • David123

      1. It reduces complexity, making April 15 simpler regardless as to how much you pay in taxes.

      2. By simplifying taxes and eliminating loopholes it reduces the importance of lobbyists and special deals – and that reduces government.

      3. By simplifying taxes, it reduces the cost of compliance. If a small business saw its taxes rise under 999, but its expenses for accountants and tax lawyers declined by more than its taxes increased, that business would become more profitable.

      4. Why shouldn’t the poor pay more taxes? If we’re running $1Trillion dollar deficits each year, then each person should be paying about $3000 more per year in taxes as their fair share of the deficit. Anyone who is paying less than $3000/yr in taxes should not be complaining about the “rich” not paying their fair share.

      5. The rich who are escaping tax payments through loopholes will pay taxes under this plan. At a 9pct rate they have less incentive to try to create loopholes than they do at a 28% rate.

      6. By making it all 9′s and all single digits you make it harder to raise taxes. Ten becomes a barrier, and since it is across the board there is a pristine nature about it that either loopholes or higher rates violate.

      7. Since everyone is paying the same tax rate, everyone has an incentive to make sure the tax rate does not go up.

      8. It stops inflation from pushing people into higher tax brackets.

  • steveprost

    Or at least its lead financial commentator

    http://www.nationalreview.com/kudlows-money-politics

    Attempt by many establishment conservatives/GOP to mock/laugh 9-9-9 off the stage can now be declared officially dead.

    • Scope

      Rich Lowry, a financial adviser, who is Cain’s senior “economic adviser” is National Review. So they capitulated to 999? Do you read anything, or comprehend anything that you read?

      Cain wouldn’t release the names of his economic advisers, but said their names were well known. Then he comes up with a financial adviser named Rich Lowry who in most economists circles is not an economists?

      Here we go with yet another messiah syndrome.

      • http://travismonitor.blogspot.com Freedoms Truth

        Rich Lowrie, Cleveland accountant, is not Rich Lowry, national Review editor.

        • Scope

          correction accepted. Still, Rich Lowrie is a financial adviser. Rich Lowrie is not an economist. But, thank you for the correction.

          • steveprost

            I was speaking of columnist/editor of NR and NRO Lawrence Kudlow, who speaks glowingly of 9-9-9 at yesterday’s article “Cain the Tax Code Killer” I cited to if you clicked on the article I cite before knee-jerk written response (or even had just read the link that bears KUDLOW’s name that I gave in my brief comment! www.nationalreview.com/kudlows-money-politics). Most astute conservatives would immediately recognize kudlow’s name not only as a NRO columnist with his own MoneyPolitics blog at NRO as NR’s main economics and finance writer, but also well-known for his ubiquitous presence in economics due to his hosting CNBC’s “The Kudlow Report”, co-host of CNBC?s The Call, and a regular contributor to CNBC?s Market Wrap, Squawkbox, andBusiness Center.. His positive take on 9-9-9 will make a difference in influential circles of finance and politics opinion-makers. And he IS an economist with conservative credentials extraordinaire to add to economist Arthur Laffer, and Club for Growth, giving kudos to 9-9-9. Listen to how Kudlow ends yesterday’s article:

            “”(9-9-9′s effect):…increasing returns to saving and investment through a much lower marginal tax rate will boost asset values. Just what the doctor ordered. As for businesses, not only would they get a globally super-competitive 9 percent tax rate, but they?d receive 100 percent expensing for new purchases of capital equipment. Former Treasury hands Gary and Aldona Robbins priced out the Cain plan on a static basis and discovered it to be revenue neutral. Essentially they found a $26 trillion tax base yielding $2.3 trillion in revenue for a 9.1 percent overall rate. Hence, 9-9-9. In essence, the Cain plan combines the flat tax (with its single marginal rate) and the fair tax (which uses the national sales tax). I don?t know if this is really possible. But in terms of first principles, throwing out the tax code, lowering marginal tax rates, getting rid of the carve-outs and deductions that make the current code impossible to understand, and providing an economic-growth tonic to heal our current funk, it makes a lot of sense. That Herman Cain is rising in the polls is no surprise.”"

            Kudlow IS an economist (under Reagan was Associate Director for Economics and Planning, OMB, and Chief Economist and senior managing director of Bear, Stearns & Co among other companies). So Scope, yes I was awake, and consider you now awaken to the fact that eye-rolling snark in attitude may not be appropriate or effective to counter 9-9-9 even if you consider to disagree with it when considering the weight of conservative economic/financial opinion-makers like Arthur Laffer and Club for Growth (not to mention evidence in his surging polls among GOP primary voters) that are now taking it seriously.

  • roberthawk

    As I have said in other posts, these Stoic-Sophists are on both sides of the isle. This is not a battle between the left and right as so many indicate but rather a battle between Zealot and Liberal Stoic-Sophists and a battle between the Stoic-Sophists and the remainder of us (mostly Hebrew origin Christians and Jews). the Stoic Sophists are using both sides of Hegel’s doctrine now and the poor Hebrews are caught up in the middle, being jerked from one side to the other.

    Rest assured that the group of Zealot Stoic-Sophists who believe in (Socialism, Communism, Progressivism, Objectivism or Liberation Theology) are a vastly greater group than those Stoic Sophists which are on the Left such as the poster here. Yes I said Left. The poster of this article is a Liberal Stoic-Sophist. Van Jones and Reverend Jeremiah Wright would be examples of Zealot Stoic-Sophists. Herman Cain on the other hand is a biblical Christian who adheres to Christian doctrine. Its therefore his assumption that if enough Christians are engaged that the 9,9,9 plan will remains in checkmate, not allowing movement in either direction because of vast doctoral disagreement between the Stoic-Sophists and the Christians. Its also his intention, as I observe, to back his plan up by defining with great specificity the meaning of the enumerated powers as given under the federalist papers. In other words the taxation will not be allowed for items with are not specifically spelled out in the enumerated powers, based upon the federalist papers.

    What this means is that the Federal Government shall have it power clipped down to size as the enumerated powers and the federalist papers indented and defined. In other words the welfare clause will no longer stand alone as many Stoic-Sophist have interpreted. The welfare clause will stand defined by the enumerated powers as the federalist papers declare as it is only separated by a single comma from those enumerated powers as Hamilton explains, therefore it is part of the whole and not a single event or power provided to congress as the Stoic-Sophists assume it to be. This is a very important point as it will greatly limit the powers of Congress and the Federal Government. It will call for the elimination of laws which were incorrectly implemented by incorrectly assumed powers. It would be the basis for Mr Cain achieving his 999 plan and quite possibly a requirement of change prior to implementing the 999 plan. If the congress and federal government are limited to the express enumerated powers as the federalist papers define, then there would be no purpose for increasing the 999 plan and there might be ample cause for even decreasing it.

    Stoic-Sophists see the 999 plan as an opportunity to expand their power and taxation via their assumed powers under the separation of the welfare clause from the enumerated powers. Mr Cain however, must see that the definition of the the powers of the congress must revert back to its original intend as defined by the federalist papers. He must understand this would vastly eliminate the abuse of power which as occurred under the application of “general welfare” as a separate entity of the powers provided to congress, by the Stoic-Sophists. The limitation of congress to its enumerated powers is the point that Herman is assuming other non-Stoic-Sophists understand quite clearly. Its also a point that Stoic-Sophists don’t yet understand. Even the Liberal Stoic-Sophist who wrote this article have missed the point that it requires the clipping of the powers of congress back to their intended enumeration, in order for the 999 plan to work effectively. Mr Cain obviously plans on clipping those congressional powers back to their enumerated intent, once he is in office.

  • lineholder

    Larry Kudlow’s article at Town Hall provides a few answers to that question.

    http://finance.townhall.com/columnists/larrykudlow/2011/10/15/cain_the_tax-code_killer

    But I’d like to ask those who understand a bit more about the complexities of our tax code a question. I also came across this information about George Kaiser, who was one of the bundlers for Obama’s candidacy and was also involved in the Solyndra situation.

    http://campaign2012.washingtonexaminer.com/article/solyndra-funder-kaiser-paid-zero-taxes-years

    For people like billionaire Kaiser who have made use of the tax code as a way to avoid paying taxes in some cases, what kind of outcomes would we be likely to see under some type of tax reform like 9-9-9?

  • Scope

    Just watching the Huckabee show. He had a leftist and a supporter of Cain on to talk about 999, before Cain responded. I’ll have to wait for transcripts of the show, but, the Cain supporter, I believe, said that if you don’t want to pay the national sales tax, then keep your money in the bank, and don’t buy anything. I don’t think I heard that wrong, my husband heard the same thing.

    Cain comes on to address the critics and supporters comments. He literally talked about the bread maker. He said that we are already paying taxes from the wheat grower, to the flour maker, to the loaf of bread on the shelves. That is a VAT.

    Does Cain have any idea that the producers of products currently have a “tax exemption certificate” that excuses them from paying taxes all along the way of a produced item? Cain really did say that we are already paying VAT taxes. Yeah, he did say that. Really?

  • conservativecurmudgeon

    1) It won’t ever pass into law, at least unscathed. But, that’s Okay. Kemp-Roth originally (originally!) called for an elimination of the Capital Gains tax (!) and an across the board income tax cut in all brackets by 30%.

    25% was all we got. And that was fine. It moved us off the dime of doing NOTHING AT ALL.

    2)– Which is what is great about the Cain proposal. If Mr. Cain is the nominee, (much less the man actually elected), it sets the whole country on the dialog of talking about overhauling the current tax structure. Everything (-and I mean everything) would be on the table in this regard.

    2a) 9-9-9, as you’ve alluded to here, is better than 4.3-55.79-22.33-4.787-2,2-6677.99999-1.5-(ad infinitum) of the, say, Romney Plan, with which not even Romney is familiar.

  • defenseconservative

    … it is becoming evident to ever more people that Cain is not ready for prime time and not ready to be President.

  • Xasteius

    This from the NY Times this morning on 999 (the article does refer to 999 in the last half of the article:

    http://thecaucus.blogs.nytimes.com/2011/10/16/cain-says-his-deadly-fence-plan-was-a-joke/

    …a 9% rate when combined with state and local levies would mean a tax on goods of 17% or more in many places.?

    ?Don?t combine it with state taxes,? he said. ?This doesn?t address state taxes. If you combine it together, yes, you would get that number. This is a replacement structure. These are replacement taxes, they?re not on top of anything…

    With the current structure, you have state taxes, right? So with this new structure, you?re still going to have state taxes. That is muddying the water.?

    Can you explain what he means? It sounds like doubletalk and evading the question.

    • Craigpennsylvania

      Let’s say a state has an 8 percent sales tax now. On a $100 purchase, this means $8 in taxes.

      Now let’s say a person making about $1200 per week has a current tax federal burden of about $180 (married, filing jointly, family of four). For the sake of the math, let’s assume this person has to pay another $60 in state/local taxes.

      That person has $960 in net income.

      Under 999, that same person would have $108 in federal taxes and the same $60 in state/local, for a total of $168.

      This means this person has $72 in disposable income more with 999.

      On that $100 purchase, he pays $9 in taxes. The “replacement taxes” Cain talks about is the person has this extra $72 (weekly) to cover the $9 per $100 in sales taxes. Bascially, under this example, the person would have to spend $800 of the $960 for his/her tax burden to be the same as it is today ($800 x 9% = $72).

      Another way of saying it – the state sales tax is currently in addition to all the federal taxes we are paying today. This will still be the case with 999.

      All the above numbers are done using static numbers, and do not factor in the ridding of FICA tax burden to the employer, possible wage increases under 999, etc …

    • http://www.redstate.com/thesophist TheSophist

      The 999 Plan doesn’t deal with state taxes at all.

      So while the questioner is correct that Americans would face a large sales tax (9% national + 8% state/local), I think Cain was objecting to his plan being classified as if it were a 17% sales tax, rather than a 9% sales tax.

      I think it’s an inarticulate answer, but the point remains the same. Cain should simply concede that yes, his plan does mean a significant increase in the sales tax, but it also means more money in the taxpayer’s pocket.

      The beautiful thing about consumption taxes is… the taxpayer is more in control of whether he wants to pay taxes or not than any form of income tax. I can’t really choose whether to get paid or not (I need to get paid…); I can choose whether I am going to buy that second iPad or not.

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