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The 9-9-9 Plan: Is The Herman Cain Tax Plan A Good Idea?

As he continues to heavily tout his “9-9-9 plan”, Herman Cain has seen his popularity soar.  But is the Herman Cain tax plan a good idea for America?  Without a doubt, the “9-9-9 plan” is simple and it is easy to remember.  To most Americans, it sounds like a low tax plan.  But is that the truth?  As you will see below, Herman Cain’s 9-9-9 plan will actually raise federal taxes on some middle income Americans to as high as 37 percent.  If the other Republican candidates understood this, they would be jumping all over Cain.  But instead the best that most of them seem to be able to do is to make jokes about it.  For example, Jon Huntsman said that he thought that the 9-9-9 plan “was the price of a pizza when I first heard about it.”  That is a funny line, but the reality is that the future of our tax system is very serious business.  Our economy is dying and our nation is drowning in debt.  We need some very real solutions to our very real problems.  So let’s take a closer look at the 9-9-9 plan that Herman Cain is proposing….

The one great thing about the 9-9-9 plan is that it would completely eliminate the current tax code.  That should be the starting point for any proposal for reforming our current system of taxation.

Under Herman Cain’s plan, all current federal taxes would be eliminated.  Social Security taxes would be eliminated, estate taxes would be eliminated and capital gains taxes would be eliminated.

All current tax deductions and loopholes would be eliminated as well.

So far so good.

Under the 9-9-9 plan, the current tax system would be replaced with a 9 percent personal income tax, a 9 percent business income tax and a 9 percent national sales tax.

Uh oh.

9 sounds like a low number, but when you add tax on top of tax on top of tax they can add up very quickly.  The truth is that some Americans would end up paying significantly more taxes under the Herman Cain tax plan.

Even Herman Cain is admitting this.  The following is what Cain said about his plan the other day on NBC’s Meet The Press….

“Some people will pay more”

So who will be paying more?

Will it be the those at the top of the food chain?

No, the reality is that the Herman Cain tax plan would represent a substantial tax hike for millions of middle income families.

According to ABC News, an average family of four with a yearly income of just under $50,000 (i.e. the median household income), would pay approximately $2,725 more to the federal government in taxes under the 9-9-9 plan.

Well, that doesn’t sound good.

That doesn’t sound like a recipe for economic recovery.

But if you are a middle income small business owner, the news is much worse than that.

Under Herman Cain’s tax plan, some small business owners could end up paying up to 37 percent of their incomes in taxes to the federal government.

Here is how that breaks down….

#1) First they would pay the 9 percent personal income tax.

#2) Secondly, they would pay 9 percent on all business income.  There would not even be a deduction for wages paid out.  This would hit some small businesses incredibly hard.  In fact, small businesses that have a very tight profit margin could be totally wiped out by this.

A lot of people have assumed that the 9 percent tax on businesses is only on corporations.  But that simply is not the case.

In a recent article, Paul Krugman of the New York Times explained what the 9-9-9 plan really says….

From comments I see that some readers believe that Cain’s second “9″ is a profits tax, which I’ve argued in the past probably falls on capital owners. But it isn’t: it’s a tax on all business income, defined as sales minus purchased inputs and dividends — but with no deduction for wages.

Ouch.

Okay, so now we are up to 18 percent for small business owners.

#3) The 9-9-9 plan also calls for a 9 percent national sales tax.  Of course the truth is that very few people will spend all of their money on things that the national sales tax is imposed upon, but theoretically this could add another 9 percent to an individual’s tax burden.

So now we are up to a potential total of 27 percent for small business owners.

The 9-9-9 plan would also make sales taxes absolutely crushing in some areas of the United States.  For example, it has been projected that once you throw in state and local sales taxes, some areas of the country could be facing a combined sales tax as high as 17 percent once the 9-9-9 plan is implemented.

Cain’s plan would also set the stage for a VAT tax to be implemented.  Many countries in Europe have already implemented a VAT tax, and quite a few liberal politicians in the U.S. have been eager to institute one here.

The potential dangers of a VAT tax were described in a recent article by Dean Clancy….

A VAT is a form of national sales tax that is collected at every stage of the process from the initial sale of raw materials to a manufacturer to the final sale of a finished product to an end-consumer. It’s the most insidious of all taxes, because it is built into the price of everything and consumers can’t see how much of the price is due to the tax. When taxes rise, prices rise, but consumers mistakenly assume that’s just market forces at work. Politicians love a VAT: it lets them take a lot more money out of our wallets. And VATs usually exist side by side with income taxes, not in lieu of them. Taxpayers should hate VATs for the same reasons politicians love them.

Politicians love “new revenue streams”, and once they get opened up they rarely ever get closed.

#4) Anyway, getting back to the main issue, so how do we get up to 37 percent for small business owners under the 9-9-9 plan?

Well, Herman Cain has also been heavily touting “the Chilean model” as a replacement for Social Security.

Under the Chilean model, all citizens are absolutely required to contribute 10 percent of all income to private pension plans.  Workers in Chile do not have the option to opt out of the system.

So if “the Chilean model” is adopted to replace the current Social Security system, that would mean that an extra 10 percent mandatory “tax” would be added on top of the 9-9-9 plan.

That would mean that many middle income small business owners could end up paying up to 37 percent of all of their income in taxes.

Is that something that you could afford to do?

When you add in state taxes, local taxes, property taxes and the dozens of other taxes that Americans pay each year, many middle income Americans would end up paying out over 50 percent of their incomes in taxes.

So much for a low tax plan.

So where in the world did Herman Cain get the idea for the 9-9-9 plan?

Well, there are some that are now claiming that he got the 9-9-9 plan from a video game.

Yes, seriously.

The following is an excerpt from a recent article in  The Daily Mail about the 9-9-9 plan….

Though he claims to have received the idea from a bank employee named Richard Lowrie Jr. in Ohio, observers are now questioning if the true inspiration is the tax code used on the SimCity video game.

The game, originally invented in 1989 allows players to plan and run virtual cities. The fourth version of the game, which came out in 2003, taxes players nine per cent for industrial taxes, nine per cent for residential taxes and nine per cent for commercial taxes.

Does that sound familiar?

Let us hope that this is not true.  Let us hope that Herman Cain did not get his tax plan from a video game.

But in any event, perhaps it is time to take a closer look at Herman Cain.

For example, did you know that he was once the chairman of the Kansas City Federal Reserve Board?

That is not a good sign.

As I have written about so many times, the Federal Reserve is at the very heart of our economic problems.

But Herman Cain does not intend to abolish the Federal Reserve.  In fact, he is very fond of the Federal Reserve.  He is on record as saying that a comprehensive audit of the Federal Reserve is not even needed.

The following is what Herman Cain once had to say about the need for an audit of the Federal Reserve….

Some people say that we ought to audit the Fed. Here’s what I do know. The Federal Reserve already has so many internal audits it’s ridiculous. I don’t know why people think we’re gonna learn this great amount of information by auditing the Federal Reserve.

I think a lot of people are calling for this audit of the Federal Reserve because they don’t know enough about it. There’s no hidden secrets going on in the Federal Reserve to my knowledge.

That is so sad.  There is a lot to like about Herman Cain.  But obviously his 9-9-9 plan is not well thought out, and he is a big time apologist for the Federal Reserve.

During the financial crisis, the Federal Reserve made $16 trillion in secret loans to the big Wall Street banks and to their friends.

That dollar figure is larger than the total value of all goods and services produced in the United States for an entire year.

If Congress had not passed a one time limited audit of the Federal Reserve we would have never learned about those loans.

So how in the world can Herman Cain claim that there is no need to audit the Fed?

Once again, there are definitely some things to like about Herman Cain, but when it comes to economics, taxation and the Federal Reserve, he is way out of his league.

So what is the alternative to the 9-9-9 plan?

The alternative should not be to go back to our current system of taxation.  It is broken beyond repair and needs to be abolished.

If we are going to tax income, we need a system that will be fair and not full of loopholes, that will not overly burden the poor, that will encourage businesses to stay in the United States, that will limit the size of the federal government and that will be easy to understand and implement.

But the truth is that until the federal government completely shuts down the Federal Reserve and the IRS we are going to be enslaved to debt and we are going to be paying much higher taxes than we should be.  We are operating in a debt-based monetary system which is designed to transfer wealth away from the American people.  We desperately need to change this.

It is entirely possible that we could have a system that did not tax income at all.  For much of U.S. history, that was the case in this nation.  It would certainly be possible to do it again.

So right now is definitely a time for some bold new ideas.

Unfortunately, the 9-9-9 plan is not going to be the solution to much of anything.

 

  • 007

    Cain’s plan is a disaster I have been investigating for a couple weeks now.

    The worst part is that small business with high labor expenses (ie jobs) will be destroyed. Rent, services, labor costs, even some material costs would not be deductible. Many businesses like this operate with a net profit under 9%. these businesses will be destroyed.

    Imagine what this would do to companies like Federal Express, accountants, lawyers, car washes, restaurants, car repair companies, doctors, health care. It is a gut punch our economy just can’t take.

    The second problem is creating a sales tax without abolishing the inco. The 999 plan will inevitably turn into the 20-20-20 plan

    As we are increasingly living in a service economy. Not allowing businesses a deduction for their highest costs is insane.

    Only If you are insane….should you vote for Cain.

    This may really be the 666 plan.

  • http://www.prepperwebsite.com Todd

    Thanks for the info. on 9-9-9.

    I really don’t like any of the candidates. I’m so sick of the stupid decisions…I can’t believe grown men can’t stop being selfish for one minute and make the right decisions for the country.

  • 007

    A truly horrible idea. If you like our depression, this plan will pour gasoline on it.

  • JD

    In Montana, we have no sales tax so we pay more in income and property taxes. This plan is outrageous. I dont want to spend nine cents on the dollar in stores. This will kill low income people as well. Herman Cain also doesnt get it about the Wall St protesters either. He acts like the other pols that say there are jobs out there so quit your whining and get to work. Ha! If only it were that easy. Michael is right when he said that finding a good paying full time job is like winning the lottery these days. I guess it was my time but I dont know about the millions of others. God please have mercy on them. But be carefull about being on camera participating in those protests. The toes you step on today may be connected to the ass you have to kiss tommorrow. Those protestors will eventually have to find a job and that might not look good to their future employer.
    RON PAUL FOR PRES 2012!!!

  • Joe

    Michael, you had my interest until you inserted a Paul Krugman quote. I suggest you contact the Cain folks and ask them to accept or refute your points. It would be most helpful.

    • Michael

      LOL – hey I should be allowed to quote Krugman once in a while. I don’t agree with him much, but I do find his articles to be entertaining.

      Michael

      • bobbobbobbob

        KRUGMAN WON THE NOBLE IN ECONOMICS YET U AMERIKANS KNOW MORE —- SEE U IN MED SCHOOL AS A CADAV– (fill in the blanks)

      • REED RICHARDS

        Michael,

        PERSONALLY, I FIND HERMAN CAIN TO BE RATHER REPUGNANT:

        You noted twice that there are some things to like about Herman Cain. Your article did not mention any of those “good qualities” Care to mention any of them now?

        As you have noted, Herman Cain is bad on the economics and to date no one in his camp, or Herman Cain himself for that matter, has articulated any type of foreign policy platform to speak of. What does Herman Cain have for a foreign policy plan other than banning Muslims from serving?

        IN A NUTSHELL:

        Herman Cain is a buffoon, just like the other gazillion rightwing war party morons running for figurehead emperor of the asylum states of amerika. He is the current flavor of the moment in the republican war party figurehead emperor sweepstakes. But like Eugene Robinson said, Herman Cain should enjoy his status as flavor of the moment because in the end, even icecream melts…………..

      • REED RICHARDS

        Michael,

        But I do wish to thank you for fleshing out the meat of Cain’s 9-9-9 plan. Good analysis in that regard. That is the good solid reporting I would hope and expect from your articles.

  • Nexus789

    As regards VAT – there are many positives and some negatives to VAT. It would do away with what is a sales tax mess (the high cost of tax administration) in the US and reduce the cost of tax recovery.

    Like health a universal and single system is much more efficient to administer and works in well with direct tax It would also enable a uniform online approach to tax recovery (easier to do interstate and international business). VAT can be viewed as regressive but ‘sculpting’ and exceptions to tax recovery can reduce the regressive impact. VAT would enable:

    1. Coverage – carried through to the entire retail sector rather than concentrated like sales tax across a smaller number of firms. If retailers do evade, tax will be lost only on their margins because customers that are registered firms gain nothing if their suppliers fail to collect tax, except delay in payment; they will pay more to the government themselves.

    2. Security – is superior to a business tax or a sales tax from the point of view of revenue security for a number of reasons. In the first place, under VAT it is only buyers at the final stage who have an interest in undervaluing their purchases, since the deduction system ensures that buyers at earlier stages will be refunded the taxes on their purchases. Therefore, tax losses due to undervaluation should be limited to the value added at the last stage. Under a retail sales tax, on the other hand, retailer and consumer have a mutual interest in underdeclaring the actual purchase price. Under VAT, if payment of tax is successfully avoided at one stage nothing will be lost if it is picked up at a later stage; and even if it is not picked up subsequently, the government will at least have collected the VAT paid at stages previous to that at which the tax was avoided; while if evasion takes place at the final stage the state will lose only the tax on the value added at that point.

    3. Selectivity – VAT may be selectively applied to specific goods or business entities. We have already addressed essential goods and small business. In addition the VAT does not burden capital goods because the consumption-type VAT provides a full credit for the tax included in purchases of capital goods. The credit does not subsidize the purchase of capital goods; it simply eliminates the tax that has been imposed on them.

    4. Co-ordination of VAT with direct taxation – most taxpayers cheat on their sales not to evade VAT but to evade personal and corporate income taxes. The operation of a VAT resembles that of the income tax more than that of other taxes, and an effective VAT greatly aids income tax administration and revenue collection.

    Some of the negatives cited in American articles makes me laugh and are purely driven by dogma and narrow vested interests. For instance there would be a high cost impost on US business – utter rubbish (VAT modules are built into nearly all accounting systems and the calculation of VAT would be automated). Administrative inefficiencies from not having a uniform approach to tax are very high. The UK and more recently Australia moved to a VAT system easily and VAT has been used across Europe for decades. However, I would suggest that the US would be more like the Australian experience in the sense that many US States would, for their own self interest, not want to eliminate their inefficient sales tax operation for a national or Federal tax.

    • Think!

      Hello? You seem to forget VAT is another tax upon tax upon hidden tax like inflation. Since your’re so inclined to defend a VAT tax Im sure you wont mind paying for my portion of the VAT tax. If not your not really thinking of the big picture and part of the problem but nice try.

  • Nexus789

    I would comment on Cain’s idea but it is more like moving the deckchairs on the Titanic – the US needs root and branch tax reform at all levels.

  • mondobeyondo

    Turn the 9-9-9 tax plan upside down, and it becomes 6-6-6…

  • American

    Hermain Cain is a FED plant.

    He was a former Fed Chairmen Of Kansas, and NO Fed Chairmen is ever Ex…Fed!

    His campaign is being funded by a Fed Slosh fund and other Big Bank Institution thru front companies.

    A Vote For Cain, is a vote for more Treason.

    The Campaign Slogan For Hermain:
    ************************************

    *********** Cain!

    Abolish The Fed!

    – Americans For The Elimination Of The Tresonous Fed.

  • http://theelevationgroup.net/presentation/register.php?a_aid=a6affed9&a_bid=290b868b John Jackson

    Take advantage of this economic crisis by learning from the experts and taking advantage of the greatest transfer of wealth in our lifetime. check this out:

    http://theelevationgroup.net/presentation/register.php?a_aid=a6affed9&a_bid=290b868b

  • Dan

    The solution is twofold.

    First we have to repudiate the National Debt. Sure our national “credit rating” would crash…making it next to impossible to borrow more money. GOOD! That is exactly what needs to happen. Immediate forced balanced budget.

    Now before anyone starts screaming about how we could possibly function if we cut federal spending 40% (about what it would take to balance) the answer is that it would be painful at first but we would quickly recover…and also 40% isn’t enough if we restricted the federal government to strictly its limited constitutional purposes…more like 80%.

    National DEFENSE meaning with very rare and temporary exceptions…defending our own borders…ideally a Swiss Militia system where the bulk of the population is trained to use arms and keeps them at home. That and a professional military about 1/4 the size of our existing one.

    Federal Court system to settle disputes within its Jurisdiction.

    Postal Service though it is a dinosaur…and eventually may be phased out completely.

    State Department to interact diplomatically with other nations…and little else if we would mind our own business.

    Not much else the Feds need to be doing…it needs to be done at the State and local level if at all.

    All forms of “public charity” amount to robbing some for the benefit of others. Least anyone think I am hard-hearted…I am not, and personally give to private charity. When times are tough I give less, like right now, when things are good I give more.

    But the fact is that even if I was using $100.00 bills in my bathroom for personal hygiene purposes and the people next door were starving anyone forcing me to give them money is a thief!

    The bulk of the federal budget is military…that could easily be cut 2/3rds or more if we mind our own business AND transfer payments like Social Security, Medicare, Medicaid and dozens of others that amount to “transferring” (read stealing) the money from workers to support non-workers.

    I personally know 4 perfectly healthy people my own age that are either collecting unemployment (and making no real effort to even look for work) or various forms of “disability” payments when they are not in the least disabled.

    Every single one of them would scream and cry if cut off…then would make the hard choices to take whatever job they could get and cut back their lifestyle to match income. They have zero incentive to do so at the moment.

    At minimum some of these programs such as SNAP (a.k.a. “food stamps”) out to allow people to only buy staples…e.g. beans, rice, grains, basic seasonings eggs and meat items less than $2.00 a pound. Incidentally, this is perfectly healthy…and I have eaten the same when money is tight.

    Others, such as Social (in)Security should be immediately and strictly means tested. Where I live there is a huge subdivision of large expensive houses called Sun City. You see two late model new cars at most of these homes. It is a golf course community, for Christ’s sake! Why should people barely scrapping by, living in a cheap apartment and making minimum plus a little wage, be paying for Seniors they don’t even know to live at this level.

    The bulk of these Seniors are double and sometimes triple “dippers”…with military, civilian government AND social security.

    We are headed for a brick wall of reality folks and it is time to face some hard choices and the longer they are put off the more brutal they will be.

    • Ben Dover

      Government giveaways, aka “entitlements” are a larger budget item than the military.

      “Means testing” is stealing from people who have worked hard or invested wisely. almost nobody pays as much intoSS as they take out. I think the average SS recipient takes out all they have paid in less than five years. None of us want to hear it, but the retirement age will have to be raised considerably. How did we all get the idea that retirement should be a 25 year paid vacation?

      The 800 pound rabid gorilla is Medicare.

  • r.bitting

    Any solution that has it’s genesis in politics is no solution at all. You could pay off all of America’s debt, end every war that America is currently involved in, provide everyone in America with free ( quality ) healthcare, no taxes, and guaranteed retirement by age 50, and you would still see this nation collapse. Because before a nation collapses financially, they collapse morally. When people become prosperous, they forget their maker. This nation as a whole has forgotten their maker. We have become a land full of greed and violence, corruption and entitlement. So many nowadays want a living given to them, they don’t think they should have to work for it. The system has created this monster, and now is unable to kill it. Just watch what happens with ” occupy Wall Street ” which has spread worldwide now and follow it to it’s logical conclusion, which is governmental control ( Here’s your politicians folks )which will result in the forfeiture of ALL personal freedoms. Here’s a biblical priciple for you ” if a man will not work, then neither will he eat ‘ 2 Thessalonians 3:10. That’s not to say that people should not recieve help, but it should be a hand up, not a hand out. However, This is only one symptom of the disease. If you want to understand the depth of depravity this nation has sunk to, just channel surf tonights primetime lineup. Programs that showcase adultery, drunkeness, and murder. Desparate Housewives, ( what absolute trash ). Reality shows that display people at their worst, and people can’t get enough of it. John Macarthur is right, society has reached the Jerry Springer level. But even as miserable as we have become, God holds out his hand and offers his forgiveness to all who are willing to turn from their sin. God, in his great mercy has made it possible for all people, no matter what they have done in their past, NO MATTER HOW HOPELESS YOU THINK YOU ARE, GOD STILL LOVES YOU AND HE DESIRES, HE LONGS, TO FORGIVE YOU OF YOUR SIN AND SHOWER HIS LOVE ON YOU. Yes, it’s the truth, God absolutely does loves you and has provided the way of salvation through his Son’s sacrificial death on the cross. ” For God made him who knew no sin to be sin for us, that we might become the righteousness of God in him “.. 2 Corinthians 5:21. Christ accepts the penalty of your sin by his sacrificial death on the cross, and now in God’s eyes everyone who will place their faith in that sacrifice and trust in Christ now have the righteousness of God imputed to them. What a trade! What a Savior! When God sees the Christian, it’s as if he sees his son. That’s why the Bible calls Christ the firstborn of many brothers ( and sisters of course ). Please consider what i’m saying while you still have it in your heart to do so, because for all you know this may be the last time that God allows the forgiveness of sins through Christ be offered to you. God will only strive with you for so long and no more. He will give you over to your destructive lifestyles and ultimately Hell. God, your heavenly Father loves you and his will is for you to be in heaven with him forever. God is not willing that any should perish, but that all would come to repentance and be saved. Because God is going to judge the world. We all must give an account for our lives and we have all sinned agaist him ( your own conscience testifies that this is true ). Theres only God’s way of salvation, Trusting in Christ as Lord and savior, he’s not going to deal with you according to your terms. It will be on his. Please Read your New Testament and seek after God while he may be found…. May God bless you with eyes that see…

    • callmecordelia1

      Good points, r.bitting. I guess that’s what I meant to say in my comment when I said that I have very little hope for any big (good) changes through politics. Change has to come from the people, and we have been too prosperous for too long. Add more prosperity to that, and we would have even more decay. We need to turn back to God as a country, and instead we are turning 180 degrees the other way.

    • http://www.jcbooks.org James Godson

      You are right that it is a moral not a money problem. Proverbs 22:3 – The prudent foresee the evil and hide, but the simple/foolish pass on and are punished. The Founding Fathers chose to ‘hide’ from being burned at the stake by creating this great country. We don’t know how many Jews in the 1930’s left Germany to ‘hide’ from the internment camps/gas chambers or in this century the Kurds, Sudanese, Egyptians, Syrians, Libyans, etc. But where can American Christian’s go to ‘hide’ from escalating evil?
      The USA already has nearly-sovereign nations inside its borders. They have their courts (except for capital crimes), make their own laws, including what drugs can be ingested. They issue their own Driver licenses & car license plates and their citizens pay NO income tax! The precedent is already established by the Indian Nations, so why can’t Christians form ‘Religious Reservations’? Let’s ‘come out from among them and Be Separate 2 Cor 6:17 Read how at http://www.jcbooks.org

    • justamom

      r.bitting,
      Your sense of urgency is sobering, and sadly lacking among Christians today. Most Christians are asleep spiritually, completely unaware of the calamities ahead.
      David Wilkerson preached many years ago that just before a nation comes under divine judgement, the Lord pours out prosperity, displaying His goodness and mercy in marvelous ways. It is His “last call” to repentance. If a nation refuses to repent and acknowledge the Lord, He begins to bring judgements against it. It seems that America has moved from prosperity to judgement—we are witnessing the collapse of our economy. This is only the beginning.
      I appreciate this blog and your comments.

      • r.bitting

        I love David Wilkerson. Theres a site called ” Holydeseration.com that I would strongly, and I really mean strongly, recommend to all Christians to spend time at. It’s full of sermons ( both audio & video ) that will help the Christian regain his focus. People so desparately need hope right now, and as you already know, Jesus is their only hope. Thank you for your persective the other day as well, you are a freind to be sure.

        • r.bitting

          Sorry, the site is ” Holydesparation.com ” & persective includes a P( I’m stupid, I know ). You would think I would proof read it first.

          • ScalarPhotonZ

            It’s not “Holydesparation.com”. I initially made that spelling error and it takes you to some wierd website full of Web links. It’s “Holydesperation.com”

        • justamom

          This site you recommended is a genuine treasure chest of riches and wealth! It will take months to uncover all of it. Thanks for sharing. God bless you!

    • http://lastdayrapture.blogspot.com/ TK

      Amen!

  • callmecordelia1

    I am a middle class business owner, and no, I can not afford to pay 37% in taxes! Herman Cain is a likable guy, but I am not a fan of the 9-9-9 plan. That being said, I hope somebody can come up with a solution for taxes, because I sure don’t have one. It seems like too big of a mess to fix. Even if Herman Cain were elected, and even IF 9-9-9 was a good solution, do you really think he’d be able to pass it once he’s in office? All these candidates go in with big plans, and a “change we can believe in”, and once they get into office, it’s just more of the same. I have little hope for change for the better.

  • pcbqj

    “some Americans would end up paying significantly more taxes under the Herman Cain tax plan.”

    Yes. People who pay nothing, will have to start paying something. That’s as fair as it gets. From pimps to ho’s, from pot-heads at OWS rallies with their Apple products to the CEO of General Electric, all will have to start paying in. Get some skin in the game and you will start caring about the government fraud of endless spending on the most insane programs. Business will BOOM! under this plan and the United States may not collapse… but that’s not good for the Democrat-Communist Party, which is working overtime to destroy the nation, but will only get itself bulldozed into unmarked mass graves.

  • http://EconomicCollapse Already Gone

    Here We Go Again,I Would Not Worry About Herman Cain Because This Guy Has About As Much Chance
    To Win The Presidency As Hell Freezing Over.His Own People Are turning There Back On Obama Because He Did Not Deliver The Free Cadillacs They Expected Nor The Free Houses They Wanted,
    What Would Make Anybody Want To Vote
    for More Doom And Gloom That Could Potenially Put Them down And Out For The Count. The Answer
    To This Problem From My Own Viewpoint Is That Raising Taxes In Any Way Is Not Going To Solve This Mess. Halting Illegal Imigrants From Getting Welfare And Free Health Care Would Be A Start, Because I Seen A Fox News Report That States They Are Costing Taxpayers $100 Millon A Year And I Am Not Interested In Hearing How Much They Contribute To The Economy Because Of
    The Lies That Come Out Of Washington In That Regard. This Country Is Always Sticking There Nose in Other Countries Problems And Telling Them What They Have To Do, Then Wonder Why These countries Hate America,Alot Of Money Could Be Saved By Not Doing This.Quit Giving Money To Countries Like Russia To Clean Up There Nuclear Messes, They Create This Problem And The U.S Taxpayers Are Billed To Clean It Up.
    Quit Bribing These Dictators So They Will Do As
    The Government Orders. I Could Go On And On,But
    The People Who See This Know This.So In All Reality Herman Cain’s Idea Will Not Work

    • Dave in Scenic City

      I dunno about your comment inferring that Cain has no chance of being elected. Remember, that we typically elect (or permit the selection of) the leaders we deserve….

  • SC

    Hi –

    I like your website, and appreciate what you are doing in general. Bravo!

    However, I don’t think your analysis of Cain’s plan is edifying or fair.

    1) Individuals: it is *not* correct to claim that the sales tax would add another 9% tax on individuals – even theoretically speaking. This is badly misleading your readers on the impact to middle class families.

    First, theoretically it’s impossible for Americans to exist while spending 100% of their income on taxable goods. In my case, I’ve got an income of around 90K and back of napkin math shows me I have about 36K in non-taxable expenses (Mortgage, Utilities, Property Taxes, Education, etc). Just do the math here – that puts my spending income (after income tax and expenses) at about 46K, which yields another $4,100 in taxes. Net/net: I’d estimate that Cain’s proposal would REDUCE my total Fed Taxes from about 22K to 12K. A savings of 10K per year.

    How does that not help the middle class in the 25% tax bracket?

    (Note: Cain indicates that second-hand goods would NOT be taxed, and buying second hand goods is nothing to scoff at.)

    2) The assessment of impact on Small Biz does not account for either the increased economic activity that could arise from either [a] lower tax rates on individuals or [b] potential savings from a simplified tax code (this is only a guess on my part) or [c] the economic stimulus of lowering the corporate tax rate to 9% (i.e. job growth).
    2.1) Seriously: how can lowering the corporate tax rate from an outrageous 35% to 9% not create job opportunities? Unless I’m misunderstanding something about Cain’s plan, this aspect should not be underestimated.

    3) Your criticism of Cain regarding the FED is totally out of place in this article. It has nothing to do with his tax plan. If you want to go there, fine, but do it in another article. Listen, I’m a Ron Paul guy who is interested in Cain (secondarily), and I’m no fan of the FED. But I think Cain makes a fair point when he says the problem is in Washington, rather the FED. (I don’t believe that’s entirely true, but the gist of it has some merit.)

    4) As for the fear of the VAT, Cain says he will push for legislation requiring 2/3 vote to raise any tax rates. Granted, that’s not foolproof, but I do believe it COULD work IF the American people stay engaged and insist on it.

    5) The potential benefit of dramatically cutting back on the power of the IRS to harass the American Citizen via the tax code can NOT be overstated. You acknowledge this briefly in your article as a plus of Cain’s plan, but, again, folks need to think through this. Filing income tax might turn into an utterly trivial exercise.

    6) I’m a bit flabbergasted that you don’t call out the fact that Cain is proposing a FLAT TAX. This is EXCELLENT! It removes much of the class warfare nonsense and fosters responsible thinking among Americans because if we raise taxes on anyone we raise them on everyone. This is the only moral way to run a tax system: everyone has skin in the game, and everyone is treated the same. Period.

    7) The real threat I see to Cain’s 9-9-9 proposal (which I currently SUPPORT) is that Congress messes up the implementation along the way so that the IRS retains (or worse, grows) it’s influence because the tax code is not authoritatively replaced. This would be horrific. But on this point the ball is really in the AMERICAN PEOPLE’S court to INSIST and persevere so that we genuinely see the IRS reduced to a tiny shadow of what they once were.

    SUMMARY: The bottom line is Cain’s proposal is not perfect. It may not be a touchdown, but it does look like a first down – maybe even a field goal. We have GOT to think LONG TERM and BIG PICTURE folks – I love Ron Paul, but the idea we’re going to elect him, abolish the FED and implement a gold standard anytime soon is unrealistic. We have to win this game one first-down at a time and we have got to take personal responsibility to keep pressure on Congress for long-term, systemic reform. Superman is not running for President in 2012. There is no option to “fix” everything with the election of 2012. But I think the American people do have an opportunity to use Cain’s 9-9-9 plan to begin the long road to recovery.

    • Michael

      SC:

      Good comment – definitely some things to think about.

      Michael

      • Michael

        Also, Cain has not made it totally clear what the national sales tax will apply to and what it will not apply to.

        Michael

    • AlabamaPatriot

      SC: You make some good points but fail to realize the dangers of giving those in Washington a new revenue source. You bring up Cain wanting to push for legislature to require 2/3 vote to approve tax increases well don’t forget the new Super-Congress. Cain’s time at the FED is important. Cain has also showed he is a liar and one not to be trusted.

    • Jeremy

      Great analysis, but on point #1 how do you estimate that your after tax will increase by $10K? I haven’t thought through the math yet.

      I believe this article raises good points, but do believe it is being critical just to be critical. These articles in summation leave the reader with the conclusion that there is little hope for the short-intermediate term future (that every realistic candidate will exacerbate our problems), and that the only real solutions are impossible to achieve. Like I have said, I am not ready to give up on our system, because the alternatives proposed are horrific and have never worked. Of course, as I invariably do, I something talk before thinking. It may be that this article raises the actual result of Cain’s tax policies.

  • Cain or Abel

    999 or is it 666 ?
    A very creepy image that you just can’t ignore.

  • boeing engineer

    It would probably be better to actually read the plan than to rely on far-left zealots like Krugman or ABC News analysts.

    Currently, all employees, whether self-employed or workers, pay 15% social security tax. Just because half of it is hidden from them doesn’t mean they don’t pay it. Under Mr. Cain’s plan, total income tax is 9%. But, you say, half of working Americans pay no income tax now and under his plan, they’ll end up paying 9%. Well, in my book, people enjoying the benefits of living in the USA should pay at least something, and 9% is certainly less than 15%, so what’s the beef?

    Well, what about small businesses you ask? Payroll is a business expense, and is 100% deductible. Imagine a service business where payroll constitutes 95% or even 100% of expenses. A 9% tax would put the business under. Republicans understand this. Too bad Krugman and ABC do not.

    Overall, Mr. Cain’s tax plan is a replacement plan which keeps government funding at it’s current level, but eliminates huge amounts of expenses for individuals and businesses, all related to tax preparation and compliance.

    What we should be pushing for is a 5-5-5 plan and downsized government.

    • http://lnx-bsp.net/ Tel

      I agree, the 9% paid for by the business is directly equivalent to a 9% payroll tax, and the 9% payed by the individual is directly equivalent to a 9% income tax, making 18% total (but difficult to evade).

      The sales tax component tends to force prices up, and that is effectively devaluing the wealth held by rich people (their wealth becomes diluted by the 9% sales tax), but for people desperately working to pay off their debt, the 9% sales tax doesn’t mean all that much, because they weren’t buying all that much. Also, sales tax is difficult to sidestep because it’s everywhere, and it’s easy to collect.

      Simplifying the tax code is also a good idea, stops a lot of wastage and the stupid things people do to try to create tax write offs.

      Yeah, a 5-5-5 plan would be better, but I’d be very surprised if that happens.

  • KB

    **********…where to start on this one? I feel like I am in one of those surreal movies where we are the ghosts that the live people won’t/can’t see or hear. We keep trying to get them to listen to us, but nothing works.

    My first question is: Where the crap did they get this guy from? I know he’s some kind of pizza dude, but he reminds of Obama and Clinton, who they somehow pulled out from between their buttocks when nobody knew who Obama and Clinton were. Geez, the way they can do this and make everybody fall in “love” with these yahoos is really scary. Baaaa, baaaa is what I hear when I find out that these guys have become popular with the masses.

    Interesting to note that apparently Cain doesn’t have an original thought in his head…all his “ideas” are stripped from somebody or something else(???). Oy!!!

    I also read that Cain thinks (to paraphrase) that we don’t have to buy new stuff all the time, so we won’t always pay the 9% new-stuff tax. ******…is he really that stupid? Does he know that Lousianna just passed a law that says you can’t buy USED stuff with cash? So all I can say is WOW, I’m stunned by the idiocy (on both counts). (Oh, you can use “checks” to buy used stuff…yeah, right, until they outlaw checks.)

    I truly believe that since the US has moved to computer-registered elections, that they are fixing the vote as there is no way to explain how some of these “people” are being elected. So it does not matter who we vote for, their idiot evil puppets are going to win (but I am still going to delude myself into thinking my vote counts and press that lever).

    Again, what a surreal existence the people on this planet have embraced. It is so hard not to shake the people I pass by and shout, “WAKE UP!!!!”

  • DaShui

    We already have a sim city economy, so why not a sim city tax. Cain has my vote!

  • http://Theeconmiccollapase gregge johnson

    9-9-9- will work because the tax would be blind on all companies////// It would save my company 18% in accountant fees alone…. it will save me 14% on legal fees My personal taxes will go down 23%…..You need to REDO your math ;;;;;however the sales tax on personal consumtion will go up;;;;;;Im willing to simplify for the extra sales tax,,,,

  • nowwthen

    In every interview where I’ve watched Herman Cain explaining his 9 9 9 plan he tells us that the plan will produce the same revenue as the current tax code and nobody seems to challenge him on that. Who is even capable of coming up with a comparison that’s anything other than a wild guess?

    And who do you think will pay the 9% charged to businesses that currently exploit loopholes to avoid paying federal taxes? The answer of course is the consumer. Our 9% sales tax will be on top of the passed through 9% business tax added to the price of their products.

    The low savings rate in this country shows that the poor and middle class, what remains of it, spend most of what they earn just to maintain a standard of living. The wealthy, who of course save (or could save) much or most of their income will feel the bite of the 9% sales tax far less as a percentage of income.

    And if, as you state, the capital gains tax will be eliminated there will be a whole new loophole reducing the 9% income tax to 0% for many of the wealthy.

    A simplified tax code is something everyone agrees we need and Herman Cain knows it has a great appeal to voters. . . as long as we don’t look too closely.

  • Toomanyfakeconservatives

    I listened to Herman’s “No need to audit the Fed talk” over at Lewrockwell.com and that told me all I needed to know. He’s a pseudo-conservative through and through.

    http://lewrockwell.com/eddlem/eddlem54.1.html

    Other than that, don’t expect any major changes to the war on drugs, the war on freedom, the war on unlucky nations, etc.

    WARNING: Fake Conservative Ahead

  • mark

    I like Herman Cain. I do not care for the 999 plan. A national sales tax that charges a smaller tax on goods produced in the US would be like a tariff on imported goods. You would pay a higher tax on imported goods, maybe 3% to 5% more. This might help with our trade problems. I understand that some do not feel that the poor should pay taxes. I think that every one should pay some taxes to help pay for government costs. We should get rid of income tax on earned and unearned income and go to a national sales tax with out rebates. The wealthy would continue to pay capital gains taxes at a rate of 20%. That way old Warren Buffit will pay more than his employees. He might stop complaining about what others pay. Corporate taxes could go to 20%. Maybe to stop abuse of no income tax by high earners a limit $350,000 or so could be set and the rest of a high earners income could be funneled to a capital investment and could be taxed at 20%. We would have to work on this as they would not have a capital gain until the investment was sold. A sales tax of 10% would be easy for people to figure out. This would be on new items only and not on peoples service labor. It is important that the poor contribute taxes so that they have a dog in the fight of to much spending by the federal government. The earned income tax credit goes away so that if we keep social security taxes the money that low income brackets pays goes towards it’s intended use. We need to figure out a way for social security funds to go into a seperate account that Congress cannot use for other purposes if we as a country intend to continue with it. If you want to escape much of the sales tax, buy used items or grow a garden. A used car would be tax free. A used house would not be taxed with sales tax. Used clothing would not be taxed. A new home would have already have been taxed as the materials were taxed when they were purchased. We might not be such a throw away people and our landfills might last longer. We might start building items that can be repaired again. Remember the days when if something was made in America, it was well made and of a high quality.It would cost more for a quility item up front but over the life of the item the cost would be lower. If we as a country wish to have a lower sales tax, we can have fewer programs and have a smaller Federal Government. If you like big government, then live in a state with high taxes and if you want smaller government live in a state with low taxes. Please comment as we can improve on this idea.

  • http://www.planorperish.com/ Gutter Economist

    The 9-9-9 plan and this article both sound like a little fuzzy math.

    There is only one way that a tax plan could create jobs in America. Operating a business in America would have to be more profitable than operating a business offshore. Since all presidential candidates have a code of silence about operating a business offshore, nothing will change here. So why bother to discuss the 9-9-9 fuzzy math.

    If more jobs are not created, Americans need to pay higher taxes or decrease spending which would increase unemployment.

    In the end, the 2 party candidates will once again lower taxes to get votes then increase debt to pay the bills. Nothing will change until after the economic collapse.

  • Americans For Stopping Treason

    ITS SIMPLE:

    CAIN, being a “former” Kansas Fed Chairmen is a hand picked FED Frontman,…bar none!

    No Former FED Chairmen is ever “ex-Fed”!

    They orginally wanted to call it the “666 Plan”, but felt that was just a little to obvious, but Soros noticed the handnotes on the table which was upside down to him and saw it as “999” and said, “Wait,… I have an idea what to call it!…”

    Cain is FED period, therefore wholly ineligible for serious consideration as this means The Fed is now simply trying to own the Presidency outright!

    ************

    ************

    Americans For Stop The Treason!

  • prosperity for all

    Before any kind of tax reform is proposed, 9-9-9- or not, regardless of who is intent on changing the system, wouldn’t you like to see income and EXPENSES? First things first. How much exactly is taken in and what, precisely, is it spent on? Let’s see the breakdown. Really, let’s see it, black budgets and all.
    I know, let’s give them a debit/credit card able to track every single expense and let the people decide where we need to cut expenses. The blocking out the natural sunlight and weather modification project must cost a fortune, who is paying for that?
    How about, some PEACE in the world, instead of spending astronomical amounts of $ designed and implemented for killing. Get out of the middle east for Heaven’s sake, let those peoples of the world alone and create a new industry in a new energy system right here in the states. Sunshine, (if they’ll let it shine more than one day a week!) Solar power.
    How about price controls on health care and commodities since wages are stagnant in a low wage “service economy” ( or non existant for far too many people) and inflation relentlessly rises. Really, $800 for a suppository? And how much did a sack of groceries cost you lately?
    The bottom line is, I believe, “they” -as in the ones who like to do the selecting of candidates to further their own selfish agenda- intend on bleeding the people until they merely live a subsistance in a “service economy” to serve the wealthy. Did you not notice the long term care provision for elderly- seniors, our Nation’s Treasure who have been there done that and are a wealth of living history- in the Obama care plan is being or will be trimmed out? Why is that ? Too costly to care for people who are no longer in service producing wealth for others in the service economy?
    I think the people of the world are in dire need of a true grit Leader with backbone to stand up to the robber barons.

  • Colin

    I support abolishing the Federal Reserve; however, I support the IRS. We need an agency to collect the taxes which pay for our country’s needs. I do feel however that the IRS should be more closely monitored and that they should be more firm on the wealthy.

  • gary2

    999=raise taxes on the poor and middle class and cut taxes even more on the rich. Have we not been down this road before and saw it obviously does not work?

    The following from alternate articulates why so many people vote against their economic self interest:

    Evangelical fundamentalism helped empower the top 1 percent. Note I didn’t say religion per se, but religious fundamentalism.

    Why? Because without the fundamentalists and their “values” issues, many in the lower 99 percent could not have been convinced to vote against their (our) economic self-interest; in other words, vote for Republicans who only serve billionaires.

    Wall Street is a great target for long-overdue protest, but so are the centers of religious power that are the gatekeepers of Republican Party “values” voters that make the continuing economic exploitation possible.

    The fundamentalists have replaced economic and political justice with a bogus (and hate-driven) “morality” litmus tests of spurious red herring “issues” from abortion to school prayer and gay rights. The result has been that the masses of lower middle-class and poor Americans who should be voting for Democrats and thus their own economic interests, have been persuaded to vote against their own class and self interest.

    None and I mean NONE of the repubes give two shits about any social conservative issues. You are being used as cannon fodder for the rich. Look at how quickly the repubes throw the Christians under the bus. The anti abortion ship sailed a long time ago. Get over it. The gay marriage-if you do not like it don’t marry someone of the same sex. Get over it. There are much more important things to fight for like having an economy that works for all.

  • gary2

    This is for all the people who shill for the rich by saying we could take 100% of their money and it still would be only a drop in the bucket. How wrong they are:

    From NYT:

    As of April 2011, NYU economist Nouriel Roubini and two colleagues reported last week, total U.S. household net worth amounted to $56.8 trillion. If we assume that the distribution of U.S. wealth has not changed since 2009, our latest year with distributional figures available, then the top 10 percent today hold 75.1 percent of the nation’s current wealth, or $42.7 trillion.

    A 20 percent tax on this wealth would raise over $8.5 trillion, a sum that equals about 85 percent of America’s publicly held national debt.

    Tax the rich spread the wealth problem solved. It really is this easy and the above stats prove it to be so.

    If we took 100% of their wealth (which I have no problem with) we could solve the deficit issues and have a fully funded safety net programs.

  • http://goldenladyfun.blogspot.com Pat

    First let me say as a black American (not African American) that I am offended by people like Herman Cain who use their color to give credibility to their stupid ideas. We Americans do not want to be a part of your stupid global economy, stupid Agenda 21, stupid fiat currency, stupid vaccine hoax, stupid tax schemes, stupid war on terror, stupid war on drugs, stupid media lies, false technological advances, crappy food substitutes, dumb nuclear cover ups, aspartame chewing gum tricks and fake TV shows. We are not your Ho,s and you are not our pimps, Herman Cain is nothing more than a wannabe pimp. We have had enough of you. Crawl back into the hole you crawled out of.

  • bobcat

    The Chilean model of requiring it’s citizens to purchase a private pension plan with 10% of their earnings is Obamacare redux. The central provision of Obamacare is a requirement that citizens purchase health care insurance. How can a Republican rail against Obamacare but be in favor of mandatory privatized pensions?

  • Maria

    “the Federal Reserve made $16 trillion in secret loans to the big Wall Street banks and to their friends.”

    That’s a fact, and that’s the clincher for me. Herman Cain is trying to sell us more of the same garbage. He is just another act in the distraction circus.

    The New World Order(NWO)doesn’t want ANYONE to change the course of self destruction that the world economy is on. They need complete economic collapse in order to implement the final transition into modern feudalism. This is not some stupid conspiracy theory. The NWO thinks they are doing God’s work.

    Even if we could get a President in office who had the perfect plan to fix everything, do you really think Congress would allow it? They are bought and paid for. We still need to replace a considerable number more seats to make any significant changes for the better….in our country.

    Multiply that effort times 20, because the same thing would have to take place in the top economies worldwide. The world has no sovereign nations, and the U.S. cannot function as an island….not since we lost our industrial base.

    For any plan to succeed, it would require the abolishment of the corrupt central banking system….worldwide. That means another system must be in place and ready to go.

    We do not have enough TIME for all of that to happen. The battle to save the current economic system was lost long before now….when we lost control of Congress.

    The only way to win the war is to pull the NWO down with us and start over without them. But everybody is too busy trying to save a system that has already been lost.

    The NWO is totally focused on strengthening their control. That is what all these bailouts are for….giving them complete control.

    How did this happen? We allowed ourselves to be demoralized. The NWO has been chipping away at the strength of our nation….chipping away at the morality necessary for our continued success.

    Things have been going bad for a long time…ever since we started distancing ourselves from God. Only thing is, He is probably the only one who can save us now. Nothing we do is going to work without His grace. It never has.

    Pray! Pray! Pray!

  • InArizona

    I really liked Cain, well, I still like Cain, but I DO NOT like his 9 9 9 plan. It scares me, where will a national sales tax stop? What will keep the government from increasing it? I think that Cain is purposely using this 999 plan to his detriment.

    Indulge me for a moment:

    Two facts that trouble me about Cain….

    1. Cain is out selling his new book, not on the campain stops that he NEEDS to be at.

    2. Cain supports Romney and not Perry, he will not say anything negative about Romney AT ANY COST, but he rips Perry to shreds.

    I really hate to say it, but I think Cain is a plant, only to get the GOP vote away from Perry and then thow the GOP nomination at Romney. I have heard whispers of this in other circles and tried to ignore it, but I can’t make that feeling go away. I listened to my gut on Obama.. from the very begining and I was right, maybe I am this time too?

    • InArizona

      I should have said 4 facts, forgot two:

      3. Cain has no campaign infastructure.

      4. Cain is not raising money, because of lack of campaign disciplin and stuctural integrity.

  • Prophet

    The biggest lie that we are told by the politicians is that we have to pay the debt! RINOs are jumping onto the bandwagon that we need to pay all of our “debt.” The debt is a fraud and doesn’t need to be repaid. The 9-9-9 plan is a joke and will screw over the poorest Americans making minimum wage. Why don’t we completely abolish the income tax and payroll taxes?

    The US Constitution gives the Congress authority to issue currency and credit WITHOUT borrowing it. The fact that the US “borrows” paper is the biggest fraud perpetuated on the American people. People need to wake up and realize the “debt” is an illusion and complete fraud system.

  • http://garden-home-furniture.com/ Curtis

    be fond of your things on the point it The 9-9-9 Process: Is The Herman Cain Levy Design A Worthy Universal concept

  • Lenni Pike

    Any type of tax cut is not really a tax cut unless government spending is decreased by the same amount. If it is not, then the money needed to pay for the same level of spending will either be borrowed or created and that is the same thing as a tax – resulting in zero reduction of taxes.

    So, in the exact same sentence that the “former” Federal Reserve member (as in gang) announced his new tax, he should have said where the spending cuts were going to be made.

    The Federal Reserve invented the IRS. Cain is just another dishonest crook no matter how earnest and personable he may seem – his prior work history shouts that out – how come nobody hears. It’s very difficult to detect the thievery of the Federal Reserve – maybe that’s the reason.

    Just like the Mafia, that’s one organization you don’t just walk away from.

    Maybe he doesn’t understand just who and what the Federal Reserve is due to his desire to make something of himself in this world – even worse.

  • oleguy

    VAT is a tax with diminishing returns. People just stop buying big items. Buy a car and then keep it alot longer as you do not want to go out and pay the VAT. Same goes for alot of goods.

    I do not like Cains plan. Having said that he is the only candidate to actually have a plan in writing. How about we ask the other candidates to put forth a plan in writing for a change, so we can examine theirs as well. Funny how we elect people and all they have is a speech. I prefer something in writing.

  • Rick

    You can always depend on politicians to raise taxes on the middle class, and this plan is no exception.

  • Lenni Pike

    That is unless this 9-9-9 is a tax increase and not a cut.

    I didn’t hear him say which.

    Just assumed it was a cut to get votes.

  • Lenni Pike

    On second thought, I suppose some tax cuts could result in more government revenue, but it doesn’t matter anymore, it’s too late for the National Debt to be brought under control unless we do something like what Dan suggested.

  • Andy Cowling

    Maybe I’m mis-reading, but from where I sit in the UK, you guys have it easy! We pay 20 pence on the pound for all purchases (except food and curiously, books), and that’s after having paid ~23% in income tax. If we make any money on savings, that gets taxed, and if we save up some money to pass on to those we leave behind, that gets hugely taxed. And that family home you want to leave your kids when you pass away? That’s taxable for them too.

    For every pount we earn, at least 50 pence goes back to the government. So 37% sounds quite attractive to me!

  • jackro

    This is all well and good, but you have not bothered to do the OTHER side of the math. Such as the average “hidden” tax right now is not 9% or even 18% it is 23%, so that is a 5% DROP in the “hidden” taxes.

    Second, you discussed the mandatory 10% Chilean model. Now, I don’t know all about the Chilean model, but I do know our current system. Right now people are not paying 10% for SSI, they are paying 15.5%(again a drop of 5% to their payout) 7.5% from the employee and the match of 7.5% from the employer, which means that the employee doesn’t see this money in a raise, ect. Not to mention that this money is set aside in individual accounts(not a giant slush fund).

    The other thing that you did not address is that this replaces ALL of the current Federal taxes. Finally, this is NOT a VAT tax. A VAT tax is added in at every level(not just at the end like the 9-9-9 plan, or the Fair Tax plan). So this does not open up the “nightmare” that you are describing.

    Now, businesses don’t get all of the “tax deductions”, but they do get a cut of over 50% from their current levels, which is probably a much better net loss than they would get from all of the little “benefits”. It also blocks companies from using loopholes to pay ZERO taxes like GE did last year. It also forces the “underground” market to pay taxes on purchases as well.

    So, in short, I find it sad that someone that has done so well in digging into economic truths would simply IGNORE the other side of the equation and focus only on the tax side and not on the tax savings side.

  • Lenni Pike

    The chances of the next Presidential Election taking place is very very slim so none of this even matters.

    The Federal Reserve’s end game is here – they can see that Americans and others are not going to take it anymore (as planned) and that they’re ready for relief with a new system. Because of national debts and the destruction of currencies, mathematically the game is over with anyway, not to mention that Western Economies have been exported.

    The time to implement the one world currency and government is here – now – “ironically” right before Iran is going to be attacked. Do they have nukes or not? Is that important or not? Nothing like a nuclear explosion to put all of this protesting stuff to an end and get the people of the world to snap back into line and attend to their new NWO work assignments.

    Nuclear explosion? – “You guys that know about these things handle the situation for us please – we are afraid and will do anything you think best, especially during this world-wide economic depression”

    Just this past Sunday some foreigner that has an American Sunday morning MSM propaganda show was describing how the NWO monetary system for individuals will work using cell phones.

    There will be intentionally fabricated reasons for a national emergency to be declared way before the elections arrive.

    Not trying to scare people – “they” are. Just trying to warn people so the necessary individual preparation can be made so as to have no fear when our walk through the valley of death begins.

    Have a nice day.

  • SMASH THE CONTROL MACHINE

    EVERY THING WAS ARIGHT TILL I GOOGLED CHILEAN MODEL!!!MAN WHAT BEAUTIFUL WOMEN!!LOL

  • doomster

    The reality is that some people’s taxes do need to be raised if this country is going to avoid bankruptcy. But it shouldn’t be the poor and lower-middle class who have to pay more. Herman Cain is just another rich guy who thinks everyone can be a big success like him if they want to be. Where I live a 9% tax added to the sales tax would add a total of 16% to restaurant meals – is that going to help the economy? This country needs to straighten out its priorities and stop spending hundreds of billions on overseas military bases while it cuts the minimal home heating assistance that the poor receive: http://aeinetwork.com/news408.html

  • SiliconJon

    I agree the plan is absolutely horrible without at least allowing a living deduction (such as 60k in cheaper areas). And how anyone who wants to end the Fed then somehow brings theirselves to support this 8 year Chairman of the Fed, Herman Cain, who pulled a Bernanke lie claiming the Fed to be transparent absolutely confounds me.

    Also, a critique on the math: with three 9%’s the most one could pay is 24.57%. Why? After the first 9% is paid you’re paying 9% on 91% of the previous total. And then again 9% on 82%, as each monetary level is 9% less after paying the previous level’s 9% taxes. And that’s using 100% remainder levels (which is unlikely in any case).

  • knightowl77

    Ron Paul will be laying out his plan tomorrow that cuts $1 Trillion, from the budget and eliminates the Dept’s of Ed & Energy along with across the board cuts to other Fed agencies…

    Drastic. But in this mess something drastic is needed. I am leaning more and more to Dr. Paul.

    It will be interesting Michael, to see what you think of his plan when you get the chance.

  • JackieR

    I realize that this article talks about ‘TAX’.
    So now what will happen with the ‘FEES’ that are imposed and constantly increase. My car reg just came in and $8 fee increase. The states, you can bet will keep the fees also.

  • http://elevationgroupvideo.com The Elevation Group

    The IRS was created shortly after the Federal Reserve Act was voted in, to collect taxes to pay interest on our debt to the Fed.

    So instead of focusing on revising the tax system, we need to abolish the Fed, so that we’re not paying interest to private bankers for our own money.

    Get financial education to beat the elite at their own game.

    http://elevationgroupvideo.com/about-the-elevation-group/

  • http://moneycrisisgameplan.com Money Crisis Game Plan

    Herman Cain is Pro-Fed and 9-9-9 is just another way to funnel our money into the bank accounts of the private bankers who own the Fed.

    Thomas Jefferson warned us, “If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them, will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered.”

    When you read that quote, you realize that we are really close to fulfilling it.

    Our national debt can never be repaid and we are headed for an economic collapse.

    Get prepared now before it’s too late. http://moneycrisisgameplan.com

  • http://whybuysilvernow.com Why Buy Silver

    “Bankers own the earth; take it away from them but leave them with the power to create credit; and, with a flick of a pen, they will create enough money to buy it back again… If you want to be slaves of bankers and pay the cost of your own slavery, then let the bankers control money and control credit.” – Sir Josiah Stamp, Director, Bank of England

    Herman Cain used to work for the Federal Reserve Bank and has no plans to abolish the Fed…

    So this tax plan would not solve our real problem… the elite bankers who own the Fed.

    They are going to bankrupt America and the Dollar, so paper assets will be worthless.

    They control the Central Banks of almost every country in the world, and every economy has a fiat currency, so no paper money will be safe.

    http://whybuysilvernow.com/

  • Dave in Scenic City

    Well, the Koch brothers are major funders of the Cain campaign. This and the fact that he’s in love with the Fed is enough for me to run the other way.

  • http://www,Back2theLand.com Old Timer

    When I was visiting Hamburg Germany the tour guide commented on this ugly building which was the taxation headquarters. What made it very interesting that the precision Allied bombings in WWII, although reduicing everything else to rubble, deliberately missed this structure. The German citizens still grumble about this.

    I think we are seeing the same thing here- careful targeting and keeping the taxation system going, and growing , and growing, and more collections. Smoke and Mirrors is the buzz word.

    I am beginging to view it is a conspiricy to drive the middle class (circa: 1340 to 2012) out of existance and return to serfdom.

    The absolute complexity of the entire financial-taxation-government “systems” is beyond repair and from my opinion I have no idea on what to do if we retain the same pace. When we speak of economic collasp-depression in todays time it is entirely different than what the USSR, Rome,the Axis Powers all faced in years past. Todays demise due to the number of population density, the shifting of farm life at 98 % to less than 2% producing food in the past 70 years perils sustained management of the people-simply put the western culture will starve. China also will have major problems in food production as most are in a factory and who wants to grub in a rice rice paddy?

    There is no socialist-capitalist retoric that will save this lifestyle. Eventually, even though we may find a management system that shows stagnation, the decline in natural resources and overpopulation will finish us all off wth in 75 years.

    This topic has been addressed for the past 300 years and in recent years has occupied the thought of social engineers and become discussed by those who will make changes for the future-not for you and I, but perhaps a limited few Indego children now emerging.

    I would sum it all up as a major mess, no more than what faced other long forgotten cultures, but only exemplified by the sheer population numbers and technical science based on warfare, public demands for services unatainable, political incompetence and corruption.

    We enjoy your though provoking article Mark, keep thinking.!

    OT- http://www.Back2theLand.com

  • http://thetruthfulone.com David

    “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning“. – Henry Ford

    The banking system and the elite bankers that own the Federal Reserve are the real problem.

    They probably love Herman Cain’s new tax plan, because it creates a new way for the bankers to tap into more of the money of the middle class.

    It really doesn’t matter. The changes, if passed, wouldn’t take effect for years, and in the mean time prices on food and goods continue to rise, which will bankrupt the middle class.

    You better prepare for an economic collapse, especially if you live in a big city.

    http://thetruthfulone.com/urban-survival-guide/

    • Jeff

      Thank god people like you understand and are catching on!! I hope we can all begin to target the real enemy (NOT “Wall Street”, not people making 1 million dllars, not freedom, free markets, libertys, the things that made America great). We’ve been hijacked!! Time to take the country back. “Let’s Roll”.

      • http://thetruthfulone.com/ David

        Thanks Jeff, I appreciate your comment.

        Teddy Roosevelt said “Behind the ostensible government sits enthroned an invisible government owing no allegiance and acknowledging no responsibility to the people. To destroy this invisible government, to befoul the unholy alliance between corrupt business and corrupt politics is the first task of the statesmanship of today.”

        Read this page on the vast corruption of the elite and their plan for the world. http://thetruthfulone.com/nwo/

  • Kathy Smith

    I totally agree GUTTER. As long as “we the people” continue to support politics & politicians in this country as we have in the past the only sure outcome is Economic Collapse. Also KB I agree voting in this country is a joke but I also vote regularly because it gives me the right to BITCH

  • S. Wiseman

    The biggest “welfare” recipient is government, politicians in particular. They take 40 to 60 percent off the top for administrative and operational expenses (which includes their cushy salaries and pension benefits) then dole out what remains to their friends in high places. Hey, I know… maybe I should run for office, make a bunch of promises and get elected. Job with benefits!

    But seriously, government can’t solve a blessed thing. They never have. Voting accomplishes nothing but to give your consent to thieves. Look at all the highly trained and educated professionals running this god awful system – state and federal. Education? a complete failure; social security? A miserable waste; medicare/medicaid? Please, really?!! HUD? A home for every American? Not hardly, just promises to put more of my money into bankers hands; FEMA? Hurricane Katrina victims are still waiting for help.

    Every perceived benefit that Americans get from the government benefactors was NOT achieved by voting. It came at great cost of American lives through sit-ins, steel worker strikes, mine worker strikes, bus boycotts, marches, lawsuits as far up to the supreme court, and so on. Change comes when each on becomes the change they want to see. We’ve all been socially engineered to believe that we have to have a man rule over us and that we have to have people in “power” to tell us what to do. Even if you totally enslave yourself to a man-made government system you will not be secure, you will not be fed, you will not receive proper medical attention. No civilization has ever existed where total enslavement worked to benefit the enslaved.

  • Jeff

    9-9-9 is best expressed in the German language. This plan will systematicallu destroy (middle) America. The socialists and 1% should love it.

  • laura

    We don’t need both a VAT tax and the Fed. flat tax!! I’m for a flat tax, but not a VAT which would ruin the econ as people would keep cars longer and not upgrade other items. Keep sales taxes as they are now (varies by state), and simply have an income tax-flat tax like 12-15% for everyone regardless of income.No deductions on anything. 47% aren’t paying any income tax..make them pay too, as they are freeloaders on the other 53 %..This would do away with most of the IRS, and way less need for audits on deductions, etc. A friend just said: only a VAT.. no flat tax; we just don’t need both.

  • Mark

    I like the 9-9-9 tax, no loop holes, plain simple and because were all treathed the same I’ll respect it, how much I hate taxes.
    this way, I know what I can spend, and have no surprises.
    besides, Herman Cain is the only one, that I know of, who actualy has a solid plan.
    Are you up for surprises, because taxed you will be!

  • Lenni Pike

    Michael,

    By placing newer comments that relate to older comments directly underneath those older comments, when we readers notice that more comments have been added by noticing the printed number of comments, we are forced to read every comment over each time more comments are added to find out where the newer comments are located.

    If instead all comments were placed in the order in which they were received – we readers have memories and would still be able to connect the dots – it would be a lot less work for us.

    Reading the same comments over and over and searching your memory is a lot of work and no fun.

    Maybe it’s just me.

  • MarkD

    Lol, I find all of this so crazy. I have read the story and every comment. Do any of us for one second think the voting representatives will allow any of this to happen? Corruption has destroyed congress. We would need to vote in 400 people who believed exactly what the new president believes. Obama couldn’t even get a budget passed when he had majority in both houses. Republicans and Democrats in congress for the most part are in that top 1% of our population. They vote for what helps them and their friends which ARE each other. I want this to end good so bad, but in my heart I believe there is death and distruction coming. Never the less the only fair tax is a flat tax with very, very limited deductions that can never be added to by law. Welfare recipients must be limited by time and be drug tested. S.S. must be means tested and for the pyramid scheme to work, even if you make over 250k you must put in the same percent as everyone else period, nobody draws without investing. You can’t show up in America at 64 and start drawing S.S. No unemployment find a job. America is the most powerful nation to ever exisit, we must act like it and not be ashamed. In my world suing ends and lawyers have to find a new job. If you slip on a floor its an accident and you go woops, not call a lawyer. Wall street closes “NO PUBLIC GAMBLING HOUSE FOR THE RICH” to bet on how much of the poor guys retirement they can steal. Everyone on this blog knows our country can be fixed. We all have ideas that we could come together on for the good of the people. I don’t think a single person on here wants his taxes lower or his check higher or his retirement sooner. I would happily pay more taxes, retire at 70 on half if it would allow my children and grandchildren to not have to go through what will be the worst and probably bloodiest time in our history. I rambled a little, but I think my point is made. God help us all!

  • Lenni Pike

    Michael,

    And you can be sure that in less than one year when you are receiving more than 500 comments per article – no one will be going back and trying to find where the newer comments that relate to older ones are located – way too much repeated work.

  • Peter

    The US current tax system really needs simplification but I don’t think 9-9-9 is a way to go. It could have a negative effect on already weak real estate market that is an extremely important part of a national economy. If homebuyers had to choose to pay a 9 percent sales tax on a new house or zero on an existing house, who would ever build a new one?

    • John

      The way I see it say everyone at first buys an existing home. Eventially all will be sold. As this process happens prices will begin to increase (think back to the early 2000’s)and at a certain point homebuilders will make enough profit to begin building again. Many people buy homes bases on a feeling about the home, not the price.
      We need the home buying process to begin to get our country rolling again and I think the 9-9-9 plan will begin this process. Once we know what the plan is we can then plan our course of action.

  • Lenni Pike

    Michael,

    A suggestion: At the end of every article you could ask any commenters (“commenters got underlined in red when I typed it) to type the name of the previous commenter to whom their comment pertains. That would assist the memories of your readers.

    I’m just say’in as they say.

    • Michael

      If you hit the “reply” button to a particular comment it will show that your comment is addressed to that person.

      Michael

  • The Unicorn

    The only way to change the tax system on a federal level is to start at a local/state level, property taxes should be abolished,all non-profits and any property exempt in full or partial from property taxes prior would be required to pay a reimbursement fee which would be used to restart, restructure a new local gov.

    If you look at it a large % of property taxes goes to pay for the public school system which does nothing but censor what a child reads (bible) and programs them to prepare for college=debt,we don’t need a bloated local gov. with silly zoning laws which restrict someone from having a garage sale, get Real.

    Once the foundation is gone the rest will collapse Thank goodness, and the Fed will disappear along with the freak show in Washington.

    Personally I feel it is to late the 9-9-9 plan could be a 6-6-6 plan and if you remove the H from Herman and add a G you get German and 9-9-9 is no-no-no in German. Who knows what they are up to????? They all have an agenda.

  • Mike in Maine

    I sure would like to hear Mr. Cain defend what you just posted. Being that the man is a solid Christian, he must have been mislead/deceived by those who worked out this plan. Because I certainly don’t believe his intentions are to deceive us!

  • Suetonious

    “Yeah man, we’re all here to like protest the greed and corruption of Wall Street, as well as the wealthy that seem to have everything, like some people on my block who always seem to have a later iPhone model than I have. We like need to tax the hell outta of’em, man.

    But first, before we get started today, I’d like to thank our corporate sponsors: like GE, Goldman Sachs, JP Morgan, and the Federal Reserve, which represents these fine banks and others, who have so generously offered their support of our movement – with a totally hip PA system, all the free grub, and even the nicely printed-up Manifestos, which they thought up, printed out, and distributed to all of us. Very very cool of them, man.”

  • JH

    I am not wild about 9-9-9 taxes and don’t expect them to become law if he is elected. We need a simpler tax system.

    At least Herman Cain stands up for Jesus Christ and Israel. It refreshing to see someone born again running for President. He knows when life begins and he values marriage.

    The Federal Reserve and the fiat money system is a horrible tax on the American people. At least Cain knows a few things about the Federal Reserve.

    • justamom

      You make some very important points, JH.
      The bottom line is NOT the economy.

      This is an economic blog. It should and does focus on economic matters, and while those matters should influence us, they should not dominate our thinking or choosing when electing leaders in this country.
      I’ll choose a man who fears the Lord over one who doesn’t, yet appears to have a sound fiscal policy.

      “Righteousness exalts a nation, but sin is a reproach to any people.” Proverbs 14:34

  • JR

    One thing you are missing in the article is the BILLIONS of hours used up every year complying with the tax code, plus the usurpation of our freedom by the 27,000 pages of the Federal Register, which we could hopefully do away with;

    • Michael

      JR:

      You make a good point.

      And in the article hopefully I made it clear that I am 100% in favor of getting rid of the current tax code.

      Michael

  • BenjiK

    Is 9-9-9 perfect? Even Mr. Cain says “no”, but it sure beats the snot out of our current tax system.

  • Alex

    Is there anything at all to like about Herman Cain? Regarding the anger over bank bailouts and corporate favoritism shown in the OWS movement, Cain says “If you’re not rich blame yourself”.

    Now there’s a guy who has the pulse on what’s wrong with this country and how to fix it. If you’re not in the 1%, it’s your fault so stop your whining (sarcasm).

  • beenaroundyaknow

    This is a phony analysis. You can’t just add together three 9’s and claim base taxes will be 27% plus state sales taxes. That is static scoring and not representative of what will happen in the economy. People will act differently than today. They may demand changes in their states and they will certainly change their behavior. Assuming they will spend 100% of their income is ridiculous. If indeed this plan changes the country to create wealth rather than try to hide it, the whole ball game changes and revenues will jump.

  • Morpheus

    How about no taxes for anyone? You deserve it. You’ll have to get out of your own.

    FIGHT THE CAUSE – NOT THE SYMPTOM
    Read “Common Sense 3.1” at ( http://www.revolution2.osixs.org )

  • josh

    Chairman of the Federal Reserve Bank of Kansas City
    In office
    1995–1996
    =shady dude

  • http://EconomicCollapse jim

    Nice try Mr. Cain. Why are you holding that 4th 9 under your sleeve? You know what happens in those old western movies when you hide your cards. What He is not telling us is the 9% payroll tax that is also in His plan.

  • NormNip

    The FairTax will end up being a boondogle that will be “fair” only to the politicians. It will not only lead to MORE VAT hidden surcharge taxes (oh yes – cigarettes in some states already have a couple of layers of this surcharge á la Canadien) but also our politicians will fail to phase out the old income tax because of some questionable emergency. So we will be subject to the very real threat of triple-taxation!! The constitution does not restrict how or how much our federal government can tax but that it be fairly and evenly applied.

    It is not about making a BETTER, fairer, kinder tax-mouse-trap: it’s about making LESS taxes/mousetraps and less government at all levels that we can afford.

    Please read the second half/ 2nd post of the Sheriff of Nottingham at the FairTax forum for a solution that works, even has a successful precedent at the level of federal government in this country and protects privacy, and several other benefits.

  • buck

    Vote Ron Paul and pray. Amen.

  • Curt

    Would the sales tax apply to Electricity and natural gas. I buy them from my utility. would those bills go up. They already have so many different taxes listed on them.

  • liberranter

    Herman Cain is a clueless moron sleazeball sock puppet, just like all the other Demopublican/Republicrat candidates (save one exception whose name I need not mention). His openly pro-FED stance and his abysmal ignorance of both real economics and foreign affairs makes him just another one of the kleptoplutocracy stooges. Waste no more time or thought on this assclown unless you want more of the same from Washington.

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