Herman Cain's 999 Plan: "No payroll taxes" = "No Social Security and Medicare"

Right now the GOP base is playing a game of 'anyone but Mitt'. They'll keep flitting from candidate to candidate with each new implosion. I expect there will be a fair amount of hard analysis in the coming days which shows exactly how untenable 999 is, and then Cain will begin to fade. Question is, does the floating support go back to Perry? To someone else? Santorum? Paul? Does the base take their toys and go home to grumble about Romney?

9-9-9 should be a pizza deal, not a tax plan.

For once in my life, I liked something Michelle Bachmann said.

“If you turn 999 upside down, the devil is in the details.”

But as pointed out here, there are no details.

In essence, the 999 plan is a slogan masquerading as a plan. You could quote the tax rates from it and not have missed anything…well, anything except revenue projections, a political strategy to pass it, job creation projections or methodology. When it comes to economic reform, America needs The Works, and Herman Cain is only offering crazy bread.

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Crazy bread for sure. Absolutely D-loo-sion-al.

Cain thinks we should follow the Chilean model for Social Security. I disagree and I think he probably knows that it's an impossibility, regardless.

As to the 999 plan being "crazy," I can't see how it's any crazier than current and past plans designed to "stimulate" the economy. And I can't see how it's any crazier than our current tax code. If nothing else, he's right on the money in that regard: scrap the whole thing and have something that actually makes some kind of sense.

Politifact's (admittedly early) analysis of 999

Even the Washington Times's analysis put the supposedly revenue-neutral plan at coming in more than $360B under what the government presently takes in.

robeiae said:

Cain thinks we should follow the Chilean model for Social Security. I disagree and I think he probably knows that it's an impossibility, regardless.

As to the 999 plan being "crazy," I can't see how it's any crazier than current and past plans designed to "stimulate" the economy. And I can't see how it's any crazier than our current tax code. If nothing else, he's right on the money in that regard: scrap the whole thing and have something that actually makes some kind of sense.

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I'm a military wife and we're a one income family. If you're not aware, though we do receive a housing allowance that somewhat balances things out, the military actually pays less than poverty level income. My husband who has been in for several years actually makes about $4,000 a year LESS than what is considered "poverty level" for our family size in the continental U.S.

We don't pay any federal or state taxes currently. Our taxes are pretty much limited to about $600 a year property and 7% sales. If we had to pay more, it would financially ruin us. Meanwhile, people making 6 figures would receive tax cuts. What exactly is fair about cutting taxes for the wealthy and raising them for those of us who are barely making ends meet?

I'm not going to propose a solution to the tax issue, but I will say that what would go a long way toward fixing our issues, would be to pay the politicians what they pay the military/police/firemen/teachers and all those other civil servents who do it because they believe in something bigger than themselves, and not just because they can make 300K sitting behind a desk for fewer days than not.

That's just MHO, though.

Alessandra Kelley said:

See this article in the Miami Herald.



(I'd like to credit my mother-in-law, who quizzically asked me about this last week: "No payroll taxes? Isn't that what pays for Social Security?")

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This assumes that all the taxes collected from this 9 9 9 fund would go directly to the General Fund, which is incorrect. Your payroll tax would be eliminated, but you would still be funding the government.

It's like if I told you I wasn't going to pay you allowance anymore, I was going to pay you per hour. Does that mean you won't get any money anymore? No, of course not. It's just a different way of distributing it.

Cain's 9 9 9 deal is a quasi flat tax and it's a proposal to change a very very flawed system. If anything, it would eliminate the IRS and corporate tax breaks. Do you think you will miss them?

FabricatedParadise said:

I'm a military wife and we're a one income family. If you're not aware, though we do receive a housing allowance that somewhat balances things out, the military actually pays less than poverty level income. My husband who has been in for several years actually makes about $4,000 a year LESS than what is considered "poverty level" for our family size in the continental U.S.

We don't pay any federal or state taxes currently. Our taxes are pretty much limited to about $600 a year property and 7% sales. If we had to pay more, it would financially ruin us. Meanwhile, people making 6 figures would receive tax cuts. What exactly is fair about cutting taxes for the wealthy and raising them for those of us who are barely making ends meet?

I'm not going to propose a solution to the tax issue, but I will say that what would go a long way toward fixing our issues, would be to pay the politicians what they pay the military/police/firemen/teachers and all those other civil servents who do it because they believe in something bigger than themselves, and not just because they can make 300K sitting behind a desk for fewer days than not.

That's just MHO, though.

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*shrug*

I'm not endorsing Cain's plan, and the reality is that it would never get passed in that form, regardless. But again, in terms of stimulating economic growth, Cain's proposal can't be any crazier than what's been done and what's on the table. And in terms of taxes in general, it's not--imo--any crazier than the current ridiculous tax code.

Me, I'm all for one income tax rate for everyone (I've got no problem, however, with a minimum income threshold for paying taxes), no deductions, no games. The same for businesses, including Churches and non-profit orgs/companies. The states can play with credits and what not for businesses. There needs to be a capital gains tax, of course, but it shouldn't be as high as the income tax rate, imo. And there should be a "death tax," as well.

So in that regard, I think Cain's plan is at least headed in the right direction.

robeiae said:

Me, I'm all for one income tax rate for everyone (I've got no problem, however, with a minimum income threshold for paying taxes), no deductions, no games. The same for businesses, including Churches and non-profit orgs/companies. The states can play with credits and what not for businesses. There needs to be a capital gains tax, of course, but it shouldn't be as high as the income tax rate, imo. And there should be a "death tax," as well.

So in that regard, I think Cain's plan is at least headed in the right direction.

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I don't agree with your tax proposals (surprise) but I will admit they're not unreasonable -- it's a position that can be defended.

Unlike Cain's, which is ridiculous.

robeiae said:

*shrug*

I'm not endorsing Cain's plan, and the reality is that it would never get passed in that form, regardless. But again, in terms of stimulating economic growth, Cain's proposal can't be any crazier than what's been done and what's on the table. And in terms of taxes in general, it's not--imo--any crazier than the current ridiculous tax code.

Me, I'm all for one income tax rate for everyone (I've got no problem, however, with a minimum income threshold for paying taxes), no deductions, no games. The same for businesses, including Churches and non-profit orgs/companies. The states can play with credits and what not for businesses. There needs to be a capital gains tax, of course, but it shouldn't be as high as the income tax rate, imo. And there should be a "death tax," as well.

So in that regard, I think Cain's plan is at least headed in the right direction.

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I'll say this: If (and it's a big if) there was a minimum income threshold for paying taxes, that was above the national poverty guidelines, I would be for one tax rate for everyone. I can look at it objectively and say, no it's not fair that someone who makes 340k a year should have to pay 35% of that, but it's not fair to expect someone who makes 18k a year and has to support a family of four to pay 9% either.

It really doesn't matter if Cain's plan (if you want to call something this brief a "plan") is nothing but a simple slogan. Cain is about nothing but simple (remember the pledge he wouldn't sign any bill longer than three pages?).

But Cain proves H.L. Mencken was right when he said, "For every complex problem there is a solution that is clear, simple and wrong."

Cain won the debate the other night by being the guy all the other candidates dog-piled on. Rick Perry? Who he? That guy who's dropped 20 points since August and now sits in third place looking up at Cain and Romney? Oh yeah, I remember now...

The pizzaman is your latest Republican front-runner according to some polls. I confess some mild surprise since I thought Cain might pay a price for rapping Perry over the N-word named rock drama, but Cain not only survived, he thrived. Apparently, eating a lot of pizza builds up stamina.

Let the economists and journalists pick apart the thin crust of the 9-9-9 scheme. Who cares if it's a reverse-Robin Hood gimmick to take more from the poor so the rich have to pay less? Herman Cain doesn't hang out with poor people. He thinks they suck.

Cain is Big Time now. He's probably got a TIME magazine cover in his future and everybody's talking about him.

Hell, he's even got his own P&CE thread now. Cain's got swag.

Go 'head, Herman.

Don said:

For once in my life, I liked something Michelle Bachmann said.

“If you turn 999 upside down, the devil is in the details.”

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That's actually pretty clever. I'd hire the speechwriter who came up with that one. I'm pretty sure she didn't do it on her own.

caw

blacbird said:

That's actually pretty clever. I'd hire the speechwriter who came up with that one. I'm pretty sure she didn't do it on her own.

caw

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Maybe she was a fan of the punk-era band.

I was under the impression that under 9-9-9 Social Security would still get funded....just not through the current FICA tax. Has Cain stated Social Security would go away through his plan?

Cain's 9-9-9 plan is temporary and only the first step. He's really proposing to replace individual and corporate income taxes with the Fair Tax - essentially a national sales tax.

Apparently the Fair Tax includes a "pre-bate" which returns the tax paid on essential items. The FICA tax is also eliminated.

I see lots of problems with the Fair Tax: growth of the underground economy, disincentive to spend money on new products, the "pre-bate" is set by a government bureaucracy.

I'd rather see a flat or flatter tax with an exemption for lower-earning workers.

What a surprise - another rich Republican proposes a tax scheme that cuts taxes on the wealthy and raises taxes on everyone else.

http://bottomline.msnbc.msn.com/_ne...-9-9-tax-plan-is-simple-youll-simply-pay-more

well at least there's gonna be "empowerment zones"

clintl said:

What a surprise - another rich Republican proposes a tax scheme that cuts taxes on the wealthy and raises taxes on everyone else.

http://bottomline.msnbc.msn.com/_ne...-9-9-tax-plan-is-simple-youll-simply-pay-more

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reading that can only lead me to conclude that another 'messiah' had bit the dust.

Wonder who's next?

The source of Herman Cain's 9-9-9 plan has finally been ferretted out.

Sim City.

Long before Cain was running for president and getting attention for his 999 plan, the residents of SimCity 4 -- which was released in 2003 -- were living under a system where the default tax rate was 9 percent for commercial taxes, 9 percent for industrial taxes and 9 percent for residential taxes.

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Don said:

The source of Herman Cain's 9-9-9 plan has finally been ferretted out.

Sim City.

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I just saw that and was going to post it. You beat me to it!

clintl said:

I just saw that and was going to post it. You beat me to it!

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reflexes.

Cain's numbers don't add up. It's regressive and hurts retirees. But give him credit for recognizing that the current tax code is terrible.
Maybe some form of his multi-tax, if not regressive, might be something to investigate.

Still, I prefer a simpler flatter tax.

Cain's investment acumen apparently matches his understanding of economics.

His advice in January 2006 (on Cavuto on Business, to tar with the same brush) was to buy Beazer Homes, then at $75 a share. Remember the housing bubble? Cain is obviously no Austrian -- he never saw the train coming.

Check out the chart in the article. Six months later, the stock was down to about $47 a share. It never got back to the $75 Herman Cain buy price recommendation.

It's trading for $1.67 a share today.

No wonder he's running for President - he needs a job!