Brought to you by Americans For Cain:
Look, I know Herman Cain isn’t perfect. He can be impulsive and brash, and he really needs to bone up on foreign policy. Many people say his 999 plan is bold and a good start, but it has problems, the most serious of which is his sales tax which some say lays the groundwork for a VAT tax. It needs some tweaking.
Freedomworks’ Dean Clancy’s thoughts on the plan, here.
Art Laffer came out and defended the plan, earlier today in an oped in the WSJ.
Republican presidential candidate Herman Cain’s now famous “9-9-9” plan is his explicit proposal to right the wrongs of our federal tax code. He proposes a 9% flat-rate personal income tax with no deductions except for donations to charity; a 9% flat-rate tax on net business profits; and a new 9% national tax on retail sales.
Mr. Cain’s 9-9-9 plan was designed to be what economists call “static revenue neutral,” which means that if people didn’t change what they do under his plan, total tax revenues would be the same as they are under our current tax code. I believe his plan would indeed be static revenue neutral, and with the boost it would give to economic growth it would bring in even more revenue than expected.
John Hayward at Human Events added his thoughts:
Laffer goes on to characterize 999 as a “flat tax.” Given the rising resistance to its sales tax component, this raises the question of why Cain doesn’t just retool it to be a flat tax. I was always more of a flat tax guy myself, while Cain approached his compromise plan from the Fair Tax perspective. In fact, his official 999 Plan brochure explicitly presents the program as an intermediate step toward the Fair Tax.
Perhaps Cain could take that step by stripping away the complex, politicized junk of the current tax code and broadening the tax base first, and then introduce the national sales tax concept later. If we were discussing any candidate except Herman Cain, I might even think that’s been his strategy all along, since almost all of the heavy fire he took in last night’s debate was aimed at the sales tax component of his plan… but Cain just doesn’t think that way. Whatever you think about his agenda, it’s hard to describe any portion of it as “hidden.”
James Pethokoukis of the American Enterprise Institute mentioned yesterday that Stephen Moore, an architect of the 999 Plan, has come to support the idea of dropping the 9% sales tax and replacing it with a 9% payroll tax. “I’m surprised how hostile people are to the sales tax,” says Moore. “When we designed this plan, I thought people would go along with the 9 percent sales tax. But the point is they won’t. And why not just do a payroll tax. It’s the devil we know…”
Cain would stroll out of a heavy barrage of opposition-research artillery without a scratch on him if he took that suggestion. Also, he could stop talking about apples and oranges. He’d lose the power of the Fair Tax concept, which makes taxes completely transparent, taxes the rich more without stacking tax rates against them (because they buy more stuff), and provides a huge incentive to investment and savings… but he lost a lot of that power by proposing the hybrid 999 concept anyway.
Given the choice we currently have – and I refer to the video above, because it does a good job whittling it down: We have a choice between, RomneyCare, “the debater” (Perry), and Gingrich, who’s brilliant, but has some unfortunate baggage that the MFM would be chomping at the bit to exploit if he were the nominee – – and that’s it, really. The rest have fallen by the wayside.
Cain’s my favorite, warts in all.
Via RCP, we have the larger than life, Cain in an interview on CNN, once again demonstrating why he’s such a contender: Herman Cain: GOP Candidates “Getting On My Last Nerve”.
RSM at The American Spectator: Cain the Contender
Hat tip: Charles B.