Cain’s Self-Serving Tax Plan

Cain’s Self-Serving Tax Plan October 25, 2011

The Tax Policy Center has done the math on Herman Cain’s 9-9-9 tax plan. And I’m sure you’ll be shocked to hear this, but it will be a massive tax cut for the wealthy and a not-quite-so-massive but still large tax increase for the middle class.

A middle income household making between about $64,000 and $110,000 would get hit with an average tax increase of about $4,300, lowering its after-tax income by more than 6 percent and increasing its average federal tax rate (including income, payroll, estate and its share of the corporate income tax) from 18.8 percent to 23.7 percent. By contrast, a taxpayer in the top 0.1% (who makes more than $2.7 million) would enjoy an average tax cut of nearly$1.4 million, increasing his after-tax income by nearly 27 percent. His average effective tax rate would be cut almost in half to 17.9 percent. In Cain’s world, a typical household making more than $2.7 million would pay a smaller share of its income in federal taxes than one making less than $18,000.

Herman Cain is, of course, a multi-millionaire. Quelle surprise.

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  • jamessweet

    A friend of mine lives two doors down from a convenience store that calls itself the “9-9-9 Market”. It’s one of those places that does a health business in 40s, and it closes around 10 after which we would often see drug deals going down in the parking lot while sitting on my friend’s porch.

    Anyway, every single time I hear about Cain’s 9-9-9 plan, the image it invokes for me is a ghetto-ass convenience store. heh…

  • MikeMa

    Just to clarify the ignorance of the GOP base, Cain is now polling ahead of Romney. This in spite of the budget killing 999 idiocy, no foreign policy concept, and an understanding of the constitution less apt than David Barton. Way to go for the clueless.

  • Mr Ed

    I was sort of liked Perry until Cain came along. He has the whole 999 thing with is little more than a marketing slogan, no position on any other issue and he lacks a campaign infrastructure. Right now I’m hoping for Cain as the GOP candidate and Bachmann as the Hezbollah.

  • Reginald Selkirk

    but it will be a massive tax cut for the wealthy and a not-quite-so-massive but still large tax increase for the middle class.

    You say that like it’s a bad thing.

  • anandine

    MikeMa said, “Way to go for the clueless.”

    Republican Senator Roman Hruska of Nebraska said about the nomination of the unqualified Harold Carswell to the Supreme Court, “Even if he were mediocre, there are a lot of mediocre judges and people and lawyers. They are entitled to a little representation, aren’t they, and a little chance? We can’t have all Brandeises, Frankfurters and Cardozos.”

    We can’t have all Lincolns and Roosevelts, nor even Clintons and Obamas, as GWB proved.

  • Michael Heath

    MikeMa:

    Just to clarify the ignorance of the GOP base, Cain is now polling ahead of Romney. This in spite of the budget killing 999 idiocy, no foreign policy concept, and an understanding of the constitution less apt than David Barton. Way to go for the clueless.

    While that base is certainly ignorant, you frame this as if the priorities of the GOP base reconcile with that of of the country’s; they do not – not even remotely. In fact many of their most important priorities would have results in direct opposition to that of the country and humanity in general.

    Instead Mr. Cain polls better simply because he’s a more loyal member of the conservative movement, which includes not just fealty to talking points guaranteed to cause catastrophe if implemented, but also loyalist behavior such as the willingness to blatantly lie for the conservative cause or lie about their enemies, which includes all non-conservatives – including their fellow Americans. So it’s not about their cluelessness but instead their priorities, where their tribalistic religionist-political takes overwhelming precedence over both their own personal interests, that of their county, and that of humanity.

    On the other hand the money fueling Republican candidates is not so extreme (though with some exceptions, the Kochs, some rich Calvinists, those who fund Cato & the Heritage Foundation, Richard Scaife, etc. They do purposefully seek benefits at the expense of humanity and their country, but not at the expense of their own short-term interests. This makes for interesting times since the plutocrats have the tiger by the tail where that tiger risks eating all of us in the medium to long-term, including them.

  • Who Knows?

    Well, it looks as though Perry has dreamed up his own self serving tax plan.

    http://news.yahoo.com/rick-perrys-economic-fix-20-flat-tax-cap-022547777.html

  • walton

    OT: Ed, have you seen this?

    Herman Cain sings “Imagine There’s No Pizza”

    It really has to be seen to be believed. (The late John Lennon must be turning in his grave.)

  • I’ve said it before and I’ll say it again, Cain’s tax plan only differs from other Republican tax plans in being a little extra loopy. All Republican tax plans include massive tax cuts for the rich, they usually include tax increases for everyone else, and they eviscerate federal revenues. This last part is obfuscated by invoking unrealistic growth rates as a result of the tax reform, as if the last 30 years of tax policy haven’t clearly shown that tax cuts for the rich don’t accomplish anything other than drive up deficits.

    They are all frauds, all of them.

  • Aquaria

    From the article who knows linked @ 7:

    The plan will eliminate the death tax and end taxes on Social Security, which would help an estimated 17 million Americans receiving benefits today.

    1) There is no death tax.

    2) How does cutting Social Security taxes help people receiving benefits? No money in, no benefits! DUH!

    3) People receiving Social Security benefits: 60 million.

    People supposedly helped under Perry’s plan: 17 million–i.e., less than half.

    Any guesses what those 17 million will be like? I’d bet that these are the same half-dead jerks causing accidents and clogging up everything when they migrate to South Texas every winter. Somehow, these annoying gits are able to afford a house in Minnesota, an RV, two gas-guzzling cars that they drive badly, a boat, a jet-ski and golf equipment, and can still rent a home in South Texas every winter, and belong to country clubs in both places. Not to mention bringing their RV, two gas-guzzling cars that they drive badly, a boat, a jet-ski and golf equipment along with them back and forth between their two homes.

    There are literally tens of thousands of people in South Texas who can barely afford one place to live. Some of them are so desperately poor that they live in colonias

    It would also cut taxes on qualified dividends and long-term capital gains.

    IOW; dividends that rich people get, and who can afford to invest enough to get long-term capital gains? If you said the richest Americans, you would be right.

    Robbing the middle class and poor to make the rich richer is now in the open. They’re not even pretending that’s not what they’re doing.

  • LightningRose

    “Herman Cain is, of course, a multi-millionaire who made his millions on the backs of minimum wage earners.”

    FTFY

  • D. C. Sessions

    he lacks a campaign infrastructure.

    Not true. The Koch subsidiary “Americans for Prosperity” provides him with all of the usual campaign services. All of his official staff are AFP employees, or were until they officially went to work for him, and all of his appearances are coordinated out of AFP offices.

    The whole thing was ready to go the day he announced. No fumbling around with so-called “exploratory committees” or any of that stuff. He went from being an AFP employee to being a candidate with his former staff at AFP working for him.

  • bahrfeldt

    check his summary- no estate “death” taxes (a major worry for most of us, not), no employment taxes (no social security or unemployment benefits), no employer deduction for most wages (double taxation of wages), no employer deduction for any purchases from non-US sources, including inventory) no individual deductions (except charities, as defined by who?), no exemptions, no child or any other credits. This is truly fucking scary.

    http://www.hermancain.com/999plan

  • dogmeat

    You guys mistakenly appear to believe that the budget implosion and tax increases on lower income families are a bug rather than a feature of the Cain “plan.” The reality is that the Republican party has spent the last thirty years building up massive deficits and corresponding debt and then scream about cuts in programs and “fiscal responsibility” when they aren’t in power. It is a brilliant overall strategy because they can then call for cuts to the very programs they didn’t want in the first place. It’s a win-win-win because it lets them transfer as much wealth as possible to their base, lets them harp on their political opponents with a long standing traditional attack (continue to drive home “fiscal responsibility”), and finally lets them cut programs that they’ve opposed for 50, 60, 70, even 80 years.

    The other point is that you suggest that raising taxes on the less wealthy to benefit the wealthy is a “bug.” Again, it’s a feature, if you believe that the poor are poor because they are lazy, ignorant, etc., and you believe that the wealthy are wealthy because you’ve read Ayn Rand, then taxing the “undeserving” poor more to give more money to the “deserving rich” is an entirely logical and “good” position.

  • Michael Heath

    dogmeat:

    You guys mistakenly appear to believe that the budget implosion and tax increases on lower income families are a bug rather than a feature of the Cain “plan.” The reality is that the Republican party has spent the last thirty years building up massive deficits and corresponding debt and then scream about cuts in programs and “fiscal responsibility” when they aren’t in power. It is a brilliant overall strategy . . .

    You assume a level of cognizance for Mr. Cain I do not find. I’d argue the more parsimonious argument is that Mr. Cain is oblivious to this meme and is nowhere near this wily. That instead he’s merely another example of the new conservative politician; one which shares the delusions and ignorance of the conservative voting base rather than a politician who cynically exploits their ignorance and delusions.

    In fact a careful study of the craftiest conservative in power over the past decade, VP Dick Cheney, also compelling argues he too was ignorant regarding this meme. So why would I believe Mr. Cain is more informed and smarter? Especially since Mr. Cain demonstrates a total lack of cognizance on far simpler, more debated matters like abortion rights and neo-conservatism’s role in our invading in Iraq.

  • dogmeat

    Michael,

    My apologies, I didn’t mean to suggest that Cain was brilliant, or that he or his advisors had actually thought through their plan in anything beyond the most cursory manner; only that the foundational argument behind the meme that he and his fellow Republicans adopt is a brilliant, albeit utterly destructive strategy. What most of us who have studied policy, economics, etc., point out as flaws or oversights are I believe, intended consequences.