Thursday, October 13, 2011

Herman Cain

Herman Cain's 9-9-9 plan should be labeled Nein-Nein-Nein (No-No-No). “The poor would pay more while the rich would have their taxes cut, with no guarantee that economic growth will increase and a good reason to believe that the budget deficit will increase.” That’s because two of Cain’s three 9s – the income tax and the national sales tax -- would disproportionately impact the 47% of tax filers ......who don’t pay any federal income tax under the current system – many of whom are elderly or poor. The extra money paid by these people would in effect subsidize the huge tax break for wealthier Americans who currently pay as much as 35% in federal income tax. And for the middle class – that shrinking group of consumers whose spending on goods and services is key to keeping the economy rolling – the 9% sales tax might discourage purchases on non-essential items. Or, as Cain himself has suggested, it might encourage them to buy used goods instead, which he says would be exempt from the tax. There is no such exemption for necessities like groceries. So, poor people who can only afford to spend on basic needs would see their cost of living increase 9%.

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