ę Top Headline Comments 10-19-11 | Main | DOOM: Now with electrolytes! Ľ
October 19, 2011

Cain's Ten Minutes in the Hot Seat

This was the first debate with Herman Cain at or near front-runner status and it showed. Right out of the gate the questions and the other candidates challenged his 9-9-9 plan.

Here he is defending it:

The thing that I would encourage people to do before they engage in this knee-jerk reaction is read our analysis. It is available at hermancain.com.

[...]

I invite people to look at our analysis, which we make available.

Secondly, the -- the point that he makes about is a value-added tax -- I'm sorry, Representative Bachmann -- it's not a value-added tax.

[...]

And I invite every American to do their own math, because most of these are knee-jerk reactions. And we do provide a provision, if you read the analysis, something we call opportunity zones that will, in fact, address the issue of those making the least.

[...]

Once again, unfortunately, none of my distinguished colleagues who have attacked me up here tonight understand the plan. They're wrong about it being a value-added tax.

The value-added tax question hasn't gone away and it hasn't gone away because Cain never explains why his proposed business flat tax is not one. He just sends people to his website.

To the limited extent he tried to argue the issue, Cain gave the misleading impression that when candidates and commentators question his proposed VAT that they're talking about his retail sales tax. Here he is:

Secondly, it is not a value-added tax. If you take most of the products -- take a loaf of bread. It does have five taxes in it right now. What the 9 percent does is that we take out those five invisible taxes and replace it with one visible 9 percent.

So you're absolutely wrong. It's not a value-added tax.

This explanation is no explanation at all. Folks aren't calling his retail sales tax a VAT. They're calling his corporate flat tax a VAT. Here's Santorum and then Bachmann explaining why:

[Santorum:] [Y]ou have a sales tax and an income tax and, as Michele said, a value-added tax, which is really what his corporate tax is, we're talking about major increases in taxes on people.

[...]

[Bachmann:] But Anderson, how do you not have a value-added tax? Because at every level of production you have a profit, and that profit gets taxed, because you produce one portion at one level, and then you take it to the next supplier or vendor at the next level, and you have an exchange. That is a taxable event.

And ultimately, that becomes a value-added tax.

Bachmann is talking about exactly what we've been talking about here for a week. Cain's corporate tax, which is calculated by taxing gross sales less purchasing costs, investments, and deductions, is a VAT because the tax falls on only the part of the sales that is "value-added." And that compounds, as Bachmann explained, at every supplier or vendor until the final sale (where the 9% retail sales tax will get another bite of it).

And while we're talking about it, here's 9-9-9 plan architect Steve Moore having second thoughts:

I love the idea [of a 9 percent national sales tax]. As you know, Art Laffer and I helped design the plan. But Iíve come to the conclusion that the American people and the voters do not want a national sales tax. Heís going to have to replace that national sales tax with a 9 percent payroll tax. And if you do that itís a total winner.

A 9 percent payroll tax on top of the proposed 9 percent wage tax? Every small business in America just cried out in terror.


digg this
posted by Gabriel Malor at 07:45 AM

| Access Comments




Recent Comments
Duke Lowell : "Hmmmmmmm. Weird. ..."

Slapweasel, (Cold1), ([b]T[/b]) Baseball Nut [/i] [/b] [/u] [/s]: "*Boom-Shakka-Lakka!* ..."

Alberta Oil Peon, survivor of GNAMM: "Coolest physics demo I saw was a standing wave, di ..."

buzzion: "[i]386 Oh dear, am I gonna go all militant German ..."

tu3031: "Went to school near there in the 80's - very Irish ..."

2009Refugee: "Oh dear, am I gonna go all militant German Left Wi ..."

buzzion: "[i]381 Baader-Meinhof. Posted by: flounder, rebel ..."

flounder, rebel, vulgarian, deplorable, winner: "Coolest physics demo I saw was a standing wave, di ..."

riktheYFITB: "Know how there's one (1) Howard Johnson's restaura ..."

Bob @ NSA: "[i]I had never heard of that bowling ball demo, th ..."

flounder, rebel, vulgarian, deplorable, winner: "Baader-Meinhof. ..."

Professor Chaos aka gumdrop gorilla: "This Damon Affleck thing is also not good for Jimm ..."

Recent Entries
Search


MuNuvians
Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
News/Chat
Archives
Powered by
Movable Type 2.64