Posted on 10/17/2011 11:08:56 AM PDT by RockyMtnMan
Do you know why candidates for office tend to be reluctant to propose detailed plans? Because they know the plans will be flyspecked and picked apart by just about everyone. Inviting criticism doesn’t help you to get votes.
But fear of criticism prevents you from conceiving solutions to problems. So even if avoidance of criticism helps in propelling you to an election victory, how are you supposed to effectively govern? How are you supposed to fix the problems you told everyone you were going to fix? That’s why I’m happy to see so much criticism of the 9-9-9 plan I’ve proposed. It shows that people are thinking seriously about a substantive idea. When people stop obsessing over “gaffes” and campaign strategy, and start honing in on fixing the country’s economic problems, we are getting somewhere. This is not to say, of course, I’m going to leave poorly founded criticisms of the plan unanswered. Certain objections to the plan are circulating in the usual places, driven by the same kind of thinking that has left us with a stagnant economy, $14 trillion in debt and mounting entitlement obligations. These criticisms deserve responses, and here they are:
Claim 1: The 9 percent sales tax, which is one third of the formula, is regressive and hurts the poor, many of whom pay no federal income taxes now. Response: This claim ignores some important aspects of the plan. One is that we eliminate the 15 percent payroll tax, which allows for no deductions at all – not even for charitable contributions. Some critics have argued that the poor still come out behind because employers pay much of the payroll tax. That demonstrates a basic misunderstanding about how compensation works in the business world. An employer decides to accept a certain cost-of-employment for each employee, and the employer’s share of the payroll tax is part of that cost. It comes out of your compensation whether you realize it or not. Also, a flat tax is not – by definition – a regressive tax. Everyone pays the same rate. And it is not an added tax, but a replacement tax, whose total burden is determined by the consumer’s spending decisions. Finally, the best way to help the poor is by spurring economic growth, which the current tax code will never do, and which the 9-9-9 plan is specifically designed to do.
Claim 2: Creating a new tax is merely setting the stage for higher rates on all taxes, as untrustworthy politicians will surely raise them. Response: First of all, that is not a criticism of the 9-9-9 plan. It is a criticism of politicians. If you don’t want the rates raised, don’t elect politicians who will raise them. Even if we repealed the 16th Amendment and eliminated the income tax, as some demand in return for establishing a consumption tax, politicians could raise that rate too. What’s far more important here is the fact that the very simple, flat-rate structure of the 9-9-9 plan, which allows no deductions, loopholes or exemptions (with the exception of charitable contributions for the income tax), is a far more growth-friendly tax structure than the mangled mess of rates, taxes, exemptions and ill-conceived incentives we have today. It virtually eliminates the massive compliance costs of the current tax code, and it restrains the size of government. By taking away the politicians’ gateway drug of loopholes and deductions, we make it much more difficult for them to mess with the tax code. Having said that, any plan could be criticized for what it would look like if someone messed it up. The plan as I’m proposing it is a huge improvement over the status quo.
Claim 3: The plan redistributes wealth from the poor to the rich. Response: It does no such thing. It is fair and neutral, taxing everything once and nothing twice. What’s more, we are getting ready to propose empowerment zones for economically struggling areas in which the rates will be even lower. That will allow the poor to benefit even more from the plan than they already would.
Claim 4: The plan should have included a pre-bate to offset the sales tax. Response: The last thing we need is to establish another federal entitlement, which the proposed pre-bate would quickly become. And it’s not necessary. The consumption tax replaces ones already embedded in prices. It’s not the prices that would increase, but the visibility of the taxes being paid. Right now, money is deducted from your paycheck and you never see it, so it doesn’t feel like you paid a tax. But you did. With the 9-9-9 plan, you feel it, and I suspect a good many people who clamor for higher taxes will start to feel differently as a result. But they won’t be paying more than before. They’ll just be more aware of it.
Claim 5: The business tax represents a new tax on labor. Response: Paul Krugman of the New York Times makes this claim because we do not allow businesses to deduct the cost of labor from their taxable revenue. But the claim is bogus for several reasons. First, we are reducing the corporate tax rate from 35 percent to 9 percent, so the tradeoff is a much lower rate paid on more of a company’s income. Second, we treat capital and labor the same, both with the corporate tax and with the income tax. That is fair and neutral. What’s more, the current system taxes both capital investment by business and capital gains by individuals. That’s a double tax, and the 9-9-9 plan eliminates it.
Claim 6: The numbers don’t add up. The 9-9-9 tax wouldn’t generate enough revenue. Response: Several groups apparently “ran the numbers” and came to this conclusion, including Bloomberg News and the Center for American Progress. Our report, which they do not appear to have read, demonstrates that it generates the same revenue as the current tax code, and our methodology is visible for anyone to see. Those who are making this claim should release their scoring so their methodology is as visible as ours.
Claim 7: The 9-9-9 plan is a really an 18 percent value-added tax plus a 9 percent income tax. Response: That’s an argument? That some might be able to give it a disagreeable label? What we have done is split the incidence of the tax so it is harder to evade – since you’d have to dodge two taxes, not just one, to save the 18 percent. And by eliminating loopholes we’ve made that virtually impossible to do anyway. I don’t really care what people call it. What matters is how it works.
Claim 8: Some people (like Herman Cain) who may live off capital gains, would pay no income taxes. Is that fair? Response: First, one of the benefits of the 9-9-9 plan is that, even if someone doesn’t pay much or any of one of the taxes, he or she is still likely affected by the other two. More to the point, though, everyone has the same opportunity to work hard, earn capital and put that capital at risk. Whatever I have earned has come from hard work, good decisions (and some bad ones), a willingness to take risks and a constant honing of strategy. Nothing is stopping anyone else from doing the same thing. I realize many are being told there are no opportunities available to them, but that is not true and I wish people – for their own sakes – would stop listening to such doom and gloom and come to understand all the opportunity that truly exists, and learn how to access it.
Claim 9: It won’t pass. Response: Politicians propose things that can pass. Problem-solvers propose things that can work. One of the worst instincts of Washington types is to judge an idea not on its substantive merits, but on their perception of its political viability. I do not underestimate the challenge of getting any good idea through Congress, but I have said all along that if you propose a good idea, and the people understand the idea, they will pressure Congress to pass it. So there. I welcome the robust discussion and the many questions that are being raised about the 9-9-9 plan. Asked and answered. What else do you want to know?
“Palin and Perry endorsed TARP also. Which of the candidates currently running opposed it?”
Are you really saying that because Palin and Perry endorsed it that Cain was right to do so? Palin and Perry have their own problems, and are certainly not the end-all be-all of constitutional conservatism, but even if they had been their entire political careers, it wouldn’t have made TARP constitutional or even smart policy.
Also, Cain said in last night’s debate basically had as his response “Yeah, I shilled for it, but I didn’t like the way the bailout was administered!” Having the common sense to understand that granting unlimited, unchecked authority to anyone, including the former chairman of Goldman Sachs, might be a bad idea in the first place ought to be a requirement for the GOP primary winner.
Bachmann and Paul certainly opposed it.
Of course not. But we are comparing candidates, if you point out a flaw in one, but all the others have the same flaw, then you have not gotten anywhere. Or, if the others do not have that flaw but are flawed in other ways, again you may not have gotten anywhere depending on how important the "flaws" are to you. If TARP is a biggie and extremely important to you outweighing everything else to consider, then I guess either Paul or Bachmann are the only choices.
“If TARP is a biggie and extremely important to you outweighing everything else to consider”
Actually, adherence and commitment to the Constitution and conservative principles is first on my list, as it ought to be for others. TARP is just one more example indicating that many of the candidates on the stage last night simply are not movement conservatives but are power-first candidates. Obtaining office should not be the objective of the Republican nominee. It should be the restoration of the Constitution.
Taking as the nominee someone who would cast aside principle and the Constitution, even for an end most agree is a good one (whether it be animus for the Rat candidate, e.g., not Gore, not Obama, not whoever, or distaste or love for a particular policy aim, e.g., killing terrorists, ending drug abuse, stopping crime), is what got the country into this mess in the first place.
“... He endorsed ROMNEY in 2008...what were his other options?”
Among others, Sam Brownback, Fred Thompson, Alan Keyes, Duncan Hunter, Tom Tancredo...heck, do you not have internet access? It’s not like you have a real response to my point which is that if you are going to pick a candidate to endorse, picking Romney out of the field is almost WORSE than McCain. At least McCain has been consistent about stabbing conservatives in the back. With Romney, you don’t know when it’s coming.
Rent is not taxed, so that is not true.
“Do you think Cain would oppose a credible effort to repeal the 16th amendment? Considering his tax plan eventually has no income tax, I think He’d be on your side.”
I don’t disagree but he’s not throwing that out as part of his tax plan. He’s proposing 9-9-9.
“Meanwhile , he’s proposing drastic improvements, even if they are reversible (though he explains why that becomes unlikely politically).”
Might indeed be a drastic improvement, but if you’re proposing drastic improvement, why choose an incremental one? It’s like saying, “Now, we know that the ideal is a flat tax, so let’s instead remove all tax credits from the income tax.” Why propose incremental change in what is destined to be the biggest mandate that conservatives could ever have? Why propose a NEW tax without removing the old one from the table? Why would any conservative support a new tax without that guarantee, given the history of new taxes this country has produced?
Cain endorsed Romney once it was clear the Romney was the only choice apart from McCain (and maybe Huck).
I’ve seen his response in the debates, and last night was more of the same “I liked it but didn’t like how it was implemented.” That’s b.s. TARP granted carte blanche over billions to a former Goldman Sachs CEO, and suddenly he’s got problems with its IMPLEMENTATION?!?!? That’s like saying “I was for the French Revolution until this Robespierre guy came along.”
Cain’s reflexively not a conservative.
ROFLMAO. Yeah, I saw this, too, and I can’t understand why he says all that then likes the Fair Tax. How is that not a national retail tax?
I actually like the Fair Tax. I just don’t see how Cain can say what he’s said here and then be for either 9-9-9 OR the Fair Tax.
I know well that Mr. Cain aims to please, too—he’s all about not being for TARP now and joking about a border wall now, since other people don’t like TARP or his statements re: electrifying a fence. Cain is no reflexive conservative.
I ask the same question I asked about Rush Limbaugh:
If you are a conservative, hoping the GOP will nominate a conservative, given the impact your endorsement may have, why would you wait to endorse anyone until your endorsement has turned into nothing more than an ineffectual cry for help?
Romney wasn’t any real plus over McCain. He was just a product of the “anyone BUT McCain” reaction. Too late for any real impact on the process. Cain is simply not a reflexive conservative.
January 22, 2008 Fred Thompson Withdraws From Race
Duncan Hunter withdraws Januar 19, 2008
Tom Tancredo December 27, 2007
Sam Brownback withdraws October 22, 2007
February 4, 2008 Cain endorses Romney
Yes I have internet access did you want Cain to endorse people who had already withdrawn? Who was left Juan McAmnesty, Romney and Paul?
Romney wasn't any real plus over McCain.
Perhaps, but a lot of facts about Romney were not as commonly known as they are now. I would say that worst case was Cain did not do a lot of homework (like many other people).
Most of the SS receipients that I know don’t pay rent because they own their homes free and clear, although some of them have not taken advantage of the property tax deferments.
“January 22, 2008 Fred Thompson Withdraws From Race...Duncan Hunter withdraws Januar 19, 2008...Tom Tancredo December 27, 2007...Sam Brownback withdraws October 22, 2007...February 4, 2008 Cain endorses Romney...Yes I have internet access did you want Cain to endorse people who had already withdrawn? Who was left Juan McAmnesty, Romney and Paul?”
So you agree with Cain waiting to endorse a candidate until it was a foregone conclusion that no conservative was viable. I’m not at all surprised to find that’s your position. I’d bet most Cain supporters would be fine with your attitude, too, seeing as how Cain is not a conservative and seems interested primarily in running to push a national sales tax in conjunction with the income tax. If Cain was a ‘conservative’ in 2008, he’d have endorsed a conservative candidate early when his support might have meant something.
“Perhaps, but a lot of facts about Romney were not as commonly known as they are now. I would say that worst case was Cain did not do a lot of homework (like many other people).”
Oh, it may not all have come out, but the basics were known then. Romneycare. His flip-flopping on abortion. The man was as big a crapweasel then as he is now. And Cain endorsing Romney is not the same as the GOP rank and file lining up to endorse McCain as the nominee (I wouldn’t have, but I understand it). Cain endorsed a RINO in the primary, not the general, so he stood up for the wrong guy, and worse, did so when he could have easily shut up and simply waited until the conclusion of the primaries, when there was no doubt he was forced into it. He’s simply not a reflexive conservative.
So tell me about Al Gore and Perry? Maybe you support that space cadet Ron Paul? He has a few good ideas and a lot of bad ones..
What about Al Gore and Perry? Perry was Al Gore’s pal, just like Perry has been a friend to LaRaza and Mexico, as well as international interests that don’t coincide remotely with U.S. sovereignty (which is why he made that clearly fake anti-UN noise last night).
As to Ron Paul, I sure don’t have a problem with his consistency on the issues, unlike Mitt Perry’s faux conservatism. But I’m still open to voting for Bachman and lately, considering Santorum. On the other hand, Hell will freeze over before I vote for Mitt Perry. And frankly, the more I hear Cain, the less I like him personally. I outright detest his 9-9-9 national sales and income tax plan, which I cannot abide for its failure to remove one of the two taxes from the table.
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