Cain's 9-9-9 plan screws the working class. Here's how - and I'm gonna make this real simple:
The working class now pays to the federal government NO INCOME TAX and only 7.5% payroll tax. That's a grand total of 7.5% in taxes.
Under Cain's plan, this person will now pay 9% income tax. THAT'S A 1.5% INCREASE.
But that's not all. On top of that, this working class person will also pay another 9% on everything they buy.
THIS AIN'T CHICKENFEED FOR FOLKS LIVING PAYCHECK TO PAYCHECK; IT WILL BANKRUPT THEM.
REPEAT: IT WILL BANKRUPT FOLKS LIVING PAYCHECK TO PAYCHECK.
These folks ain't saving 9% of each paycheck as it is; most have no cushion, and are probably saving for their kid's education or to buy a home or for a down payment on a car. Cain's plan would wipe out any and all saving these folks are struggling now to put together.
In other words, the Cain 9-9-9 plan is a disaster for perhaps as many as 45% of Americans.
Anyone who would propose such a plan is not ready to be POTUS.
I challenge anyone to prove I am wrong. And that means I defy Rush, Hannity, Levin, Kudlow, Cain, or any conservative bloggers like these great bloggers: Doug Ross, Jim Hoft, Zip, Erik. Donald Douglas, The Other McCain, Instapundit - anyone.
I am flabbergasted that Cain's 9-9-9 plan hasn't been laughed at and derided.
Herman Cain a wonderful man and would make a great Secretary of Commerce, but he'd be an awful GOP nominee for POTUS. Huntsman is actually better and he's a freaking disaster.
YUP: because of his awful tax plan, I put Cain at the absolute bottom of the pack.
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You're oversimplifying it. Remember that ALL your federal withholding will be restored; you take home your gross pay, not your current net pay. That gives most of us a 35% raise. I can afford to pay 9% income tax on that, as opposed to the 25% I currently pay, and a 9% sales tax on =new= items purchased (there's no 9% assessed on previously owned homes or cars, for example). Money you save isn't taxed unless and until you spend it: no taxes on dividends and no death taxes, either.
ReplyDeleteIt works for Professor Laffer and for the Club for Growth. It works for me.
laffer and moore helped write it.
ReplyDeletelafferclarified and said he likes a lot if it - because it clears the decks, but he did not endorse it all or endorse cain.
and now moore says the sales tax part should be dropped. heard him say it this am on kudlow.
under the current cain 999 plan, take home pay goes DOWN for folks who currently pay NO INCOME TAX - and that's 47% of Americans; right now the feds take 7.5% for folks paying NO INCOME TAX and under cain's 999 they would take out 9%.
that's 1.5% LESS.
and on top of that, this person would have to pay MOR for EVERYTHING: 9% more.
it's a non-starter.
cain has disqualified himself by proposing it in the first place.
i favor a flat tax on sales of EVERYTHING - even so-called wholesale purchases. even interst and social security taxes. everything: EVERY TIME MONEY CHANGES HANDS.
if this was done than the tax rate could be about 2%. then cap it constitutionally.
i exchanged letters on this a decade a go with moore when he was at cato.
he thought the multiplier effect might be too high, but he is wrong.
and 2% is so low that nobody would cheat.
this would be instead of all other federal taxes. no death tax. no corp tax. no cap gains tax.
First of all, the actual rate for Social Security and Medicare THAT YOU SEE IN YOUR PAYCHECK is 7.65%.
ReplyDeleteSecond, and far more importantly, your employer has to match that amount. That means that every single person who is employed by another gets paid 7.65% less because the employer certainly knows that he/she/it has to match your employment taxes. Thus, YOU GET PAID LESS BECAUSE OF THE EMPLOYER MATCH. While not (strictly speaking) a tax, the fact is that it reduces your gross and net pay.
Bottom line: Employment taxes are 15.3% (well, except for this year and last year, when the employee part of Social Security was reduced to 4.3% from its normal 6.2% - but that won't last long). Don't be so naive and believe that the only taxes that workers pay is what they see in their paychecks. I have this same beef with fellow self-employed people who bitch that they're paying 15.3% instead of 7.65% - they're being naive and not looking at all of the facts.
hi paul.
ReplyDeleteyour analysis is faulty.
my boss aint gonna give me a raise of 7.5% if cain passes 999.
anyone that thinks bosses will is an idiot.
i am not naive.
you're an idiot.
taxes for people not paying income taxes now will be higher under cains plan.
that is irrefutable.