Oct 20 2011
Cain is turning the Political Industrial Complex on its head these days. He has come out with an exciting and potentially life saving (from an economic perspective) plan to toss out the current, busted tax code and replace it with his massively stimulating 9-9-9 plan.
But there is more good news about him. When it comes to conservative social issues he is a man of faith and conviction – and one who completely resists the temptation to play God and use the federal government to enforce his views on others. The big example being discussed today is his correct stand on abortion. He agrees life begins at conception and how the decision about family is for the family to decide. Those on the far right better understand there will be no federal ban on abortion coming, not under Cain nor under anyone else. It is not in the cards.
If the right thinks 9-9-9 is hard to sell, they better realize a federal abortion ban is basically impossible.
This center-right, libertarian sphere Cain occupies (because it is who he is, not some political strategy he maps out) is where the majority of the nation is when you look at the center of Main Street. We have our beliefs and conviction, but we don’t want to play dictator. Must be our humbleness and recognition we never know enough to lecture others on what is right or wrong in complex situations.
The result has been that Cain has consumed nearly all the anti-Obama oxygen and win control the race for the White House. If you watched Hannity and Frank Luntz’s focus group, Cain was the real winner, while Gingrich came in as best in show.
Add to that the picture now coming out of Iowa in the latest Rasmussen polling and you can see broad support congealing around Cain day by day:
A new Rasmussen Reports telephone survey of Likely Iowa caucus-goers shows that Cain is in front with 28% followed by former Massachusetts Governor Mitt Romney at 21%. Congressman Ron Paul is a distant third at 10% followed by former House Speaker Newt Gingrich at 9%, Congresswoman Michelle Bachmann at 8%, and Texas Governor Rick Perry at 7%.
If Cain really is leading the Iowa GOP caucus voters then he has truly donned the front runner status. These are not right leanng moderates or independents (who he has already). It is even more amazing if you look at Iowans who are certain to participate iin the caucuses:
Among those absolutely certain they will show up and participate in the caucus, Cain leads Romney 31% to 18%.
Neither Romney nor Perry can climb this kind of lead if it solidifies as more and more people make their decisions. Right now the momentum is still growing around Cain. I suspect it will grow and grow for weeks to come since he has not stumbled and the initial claims about his 9-9-9 plan have only proven many people don’t understand math and taxes.
For example. when I wrote my 9-9-9 For Dummies post I was clear that anyone who added 9% income to 9% sales tax and arrived at 18% was pretty much clueless:
If you add the 9% sales tax to the 9% income tax you get 18% – and would demonstrate why you should not be a tax accountant. The 9% sales tax is applied only to the disposable income that goes to buy taxable goods. Not all of your disposable income goes to buy taxable goods! Mortgage payments are not taxable goods. There probably are exemptions for insurance, etc.
Greta Van Sustern had Cain on last night and does the unthinkable, she adds 9 + 9 and got 18%. Lord save us from the ignorant (and I mean that in a nice, but honest way)
The short version of the 9-9-9 for Dummies is this: at the $82,250 income level (top of the 25% bracket) one pays 28% in federal taxes (payroll + income). Under Herman Cain’s 9-9-9 that is replaced by 9% income tax and 9% sales tax. But as I said yesterday, not all your take-home pay is used on purchases that fall under the 9% sales tax Cain is proposing. By definition you can NEVER see a combined 18% tax because 9% of your income is pulled for the income tax, leaving a maximum of 91% of your income for purchasing. (Note: for those who care, the mathematical ceiling is 17.2% of your income would go to the 9% income and 9% sales tax)
Yesterday I assumed 50% of the disposable income (left after the 9% income tax) would be used on the 9% federal sales tax. And then I compare the difference between today’s tax code and 9-9-9. This was the result:
- Under the current system the $82,250 in taxable income results in $59,209 in actual take home pay, giving the government $23,042 of your hard earned money
- Under Cain’s 9-9-9 (from the perspective of the tax payer), that $82,250 in income results in $71,430 in take home pay, giving the giving the government only $10,820 of your hard earned money,
A difference of over $11,000 dollars in take home pay for an income of $82,250. Individual results will vary, especially when you trade off deductions – but the overall result is clear. Just about everyone will have more take home pay when ALL federal taxes are taken into account under 9-9-9.
Greta may struggle with this, most people get it. So how do you stop a campaign that promises to level the tax paying field, give you more of your income back to spend as you see fit, and end the reign of liberalism run amok?
You can’t beat it. So far it simply sounds too good to be true. But it really isn’t. It is just too far outside the box for those still trapped in the Political Industrial Complex. Thankfully, they are not required for Cain to win or his plans to be implemented.