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?
Cain has not proposed any cuts in government spending.
(Geeze, you guys try so hard!)
From Cain’s Website, sounds like he’s willing to cut deep to me:
“It is no secret that federal government spending is out of control. They view the American taxpayers as a bottomless piggybank for their wasteful programs and expansion of power. And we the people will not tolerate it any longer.
The massive debt caused by liberal policies will be passed onto our children and grandchildren if we do not stop it. They will be stuck with the tab for the government takeover of health care, industry bailouts and failed stimulus packages. They will be the ones approached with outstretched palms by the Chinese to pay back the billions upon billions we owe them. Each generation of Americans should seek to leave behind a better and more prosperous nation for the next, not saddle them with debt from reckless spending.
Though it might not be politically popular to modernize and eliminate some of our entitlement programs, responsible leaders should be willing to do it all the same. They must be prepared to make tough choices and learn to simply say “no.” This can only happen when our elected officials stop being politicians and start being leaders. Simply put: there is no “Department of Happy” in Washington, D.C.
Nothing should be off the table. Every federal agency, every government program and expenditure must be reviewed and revised with a keen eye and a red pen. Leaders should be willing to shrink budgets by target percentages, and those charged with implementing those changes must be held accountable.
And it works! I have served as an executive of several major corporations. When times were tough and money was tight, I asked our employees to cut back drastically, and explained why it was necessary, and they did. We have all had to make difficult decisions in our own household or at our work place. Serious but responsible belt tightening can save businesses, and it can also save our country with the right leadership.”
So is Cain saying that once FICA is done away with every employer will immediately increase their employee's base pay by 7.65%? Doe he honestly believe that will happen? Because unless they do it makes his whole 15% tax on the individual claim a lie.
http://www.foxnews.com/on-air/on-the-record/transcript/behind-gop039s-039cut-cap-balance039-pledge
Cain for President the issues-spending:
http://www.hermancain.com/the-issues
Reduce Government Spending
It is no secret that federal government spending is out of control. They view the American taxpayers as a bottomless piggybank for their wasteful programs and expansion of power. And we the people will not tolerate it any longer.
The massive debt caused by liberal policies will be passed onto our children and grandchildren if we do not stop it. They will be stuck with the tab for the government takeover of health care, industry bailouts and failed stimulus packages. They will be the ones approached with outstretched palms by the Chinese to pay back the billions upon billions we owe them. Each generation of Americans should seek to leave behind a better and more prosperous nation for the next, not saddle them with debt from reckless spending.
Though it might not be politically popular to modernize and eliminate some of our entitlement programs, responsible leaders should be willing to do it all the same. They must be prepared to make tough choices and learn to simply say “no.” This can only happen when our elected officials stop being politicians and start being leaders. Simply put: there is no “Department of Happy” in Washington, D.C.
Nothing should be off the table. Every federal agency, every government program and expenditure must be reviewed and revised with a keen eye and a red pen. Leaders should be willing to shrink budgets by target percentages, and those charged with implementing those changes must be held accountable.
And it works! I have served as an executive of several major corporations. When times were tough and money was tight, I asked our employees to cut back drastically, and explained why it was necessary, and they did. We have all had to make difficult decisions in our own household or at our work place. Serious but responsible belt tightening can save businesses, and it can also save our country with the right leadership.
But which option did you select from the drop window? It has a default for keywords. Title works better.
This is where the GOP really hurt us in Nevada
Retirees savings would be OK, because of the lowering of prices. Remember, approximatly 22% of the price of all retail items is due to federal taxes. Cain removes that and replaces it with a flat 9% income tax.
Let’s say you spent $50,000 a year from your retirement savings. This is how it would work out under both plans.
As you can see, under 999 you would come out ahead by $4263.30.
Current Tax System vs. Herman Cain 999 Tax Proposal
What would happen to the cost of spending $50,000 a year from savings?
Retail price:
Now = $50000.00
999 = $42510.00
Local sales tax pct rate = 8.00%
Local sales tax dollars:
Now = $4000.00
999 = $3400.80
999 federal sales tax pct rate = 9.00%
999 federal sales tax dollars = $3825.90
Total cost with taxes:
Now = $54000.00
999 = $49736.70
Dollars saved with 999 plan = $4263.30
22% of the current cost of retail items is due to the current tax system. Herman Cain’s plan removes this hidden tax and replaces it with a 9% flat tax. The 999 price in this calculator has been adjusted to reflect this fact. Yes, that’s right. Retail prices willl go down under the 999 plan. The effect of the current tax code on retail prices has been well documented by the FairTax supporters. You can obtain documentation for this at fairtax.org.
Calculator at nerds4cain.com
In the first place, as I've been told on more than one occasion by Cain fanatics, you can't depend on the website. You need to listen to what Cain is saying. And I can't recall hearing any specifics on what he will cut. Perhaps you can point me to some? In the second place, even if we could depend on the website it's nothing but the same mealy-mouthed stuff that all the rest of them are spouting, including Obama. They all say entitlements have to be reformed. They all say nothing should be off the table. They all say that every agency and government program has to be looked at to do away with waste and fraud. But somehow nothing ever gets done. Deficits go up, regardless of who is in office.
The patience of the American people has run out with politicians. It has simply run out. If #1 & #2 came to pass, I would expect the 2014 elections to be a bloodbath for Republicans. Literally guys that had been there 20 years would get kicked out.
Something would pass.
Here’s an example
TOPICS: Breaking News; Business/Economy; Editorial; Politics/Elections; Click to Add Topic
KEYWORDS: 999; Click to Add Keyword
You didn’t even use 9responses as a keyword. ;)
Agreed, but it doesn't help when your own party is stabbing you in the back. In a situation that close, it made the difference.
the other thread didn’t list 9responses as a keyword either
TOPICS: Business/Economy; Government; News/Current Events; Click to Add Topic
KEYWORDS: 999; 999plan; byebyeperry; cain; hermancain; perrystoast; texastoast; Click to Add Keyword
Pasting in the Title of the article then selecting Title from the drop window works best.
No it is my opinion that Cain who has been officially declared longer than any other candidate has failed to propose any Spending Cuts. All Cain has done is propose another Liberal Tax and Spend Scheme with a gimmicky name, 999.
Government Spending is the problem. I don’t want a candidate who proposes more Tax Schemes. I want a nominee who addresses the biggest problems first and foremost, i.e., I’ll vote for the Anti-Obamney who proposes the biggest Spending Cuts.
There’s only two last steps of credible threat to Congress left now.
The Founders left the POTUS and the public with two very grim options, but they are options nonetheless.
I seriously doubt that Cain has the stones to use executive power to the limit which he would have to set things right. He’s going to be surrounded by a bunch of the usual blithering idiots with Ivy League degrees, filling his ears with all manner of BS... and he’ll probably listen to them. The only way a POTUS can avoid this is to simply fire huge swathes of the executive branch staff, sack entire cabinet posts and so on.
IMO, Rick Perry would be whatever he thought would get him elected.
I can not imagine there are any “moderates” left in the Democrat Party. Only the marxists/union communists find a home there now, so how can Obama be re-elected? Nevertheless, someone is polling him at 41%, which though low is still not very comforting to see that 41% of any group would re-elect him. Probably if anyone is crazy enough to run against Obama it will be Kucenich(sp?)! Soros went all in for Obama, not Hillary. Check out theulstermanreport.com He is interviewing a Wall Street Insider today, rather than the White House Insider. Seems all eyes have to be on Mayor Bloomberg, who sits in the eye of the storm, NYC. Even if it is ficticious, it jives a bit with the obvious. Would Hillary want in on even a draft at the convention? I am just not sure, but yes I agree with you that we should walk and chew gum at the same time, and run against the Democrat Party collectivism as well as their candidate. Absolutely. That is what Obama is doing to us for the time being.
Cain is at 47% in the latest Zogby poll.
He's within the margin of error of a majority and winning the thing outright.
Some stalking horse.
Like I said Cain has proposed NO specific Spending Cuts. BS on his website about his opinion that some spending cuts might be necessary is NOT a specific plan for specific spending cuts.
All Cain has proposed so far is another Liberal Tax and Spend Scheme with a gimmicky name, 999.
“Shames the Congress into passing it?”
Uh, with all due respect, are we talking about the same bunch who:
1. Have molested and slept with pages and interns?
2. Have had prostitutes operating out of their apartments?
3. Have leaked classified information for political gain?
4. Have sent pictures of their private parts around to random female citizens?
I could go on and on.
The Congress has no shame. None. At all.
There is only one way to get Congress to do anything at this point, and it involves the use of force. The only question now will be “from where does this force come?”
My mistake, was not switching to Title from Keyword. I haven’t posted much in the last 10 years so I’m a little rusty on the latest site features.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.