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Thursday, October 13, 2011

Also 5318008 upside down spells "BOOBIES"

Michele Bachman during this week's GOP debate:
"The 999 plan isn't a jobs plan, it is a tax plan. ...when you take the 9-9-9 plan and turn it upside down, I think the devil's in the details."
You know what? Even a stopped clock is right twice a day. And I guess if it's stuck on 9 and you turn it upside down at 6:00 you can make it right four times but that's not important right now.

The point is 999 is a pretty diabolical idea any way you happen to look at it.

Cain’s tax plan consists of three different 9 percent taxes — one on wage income (investment income is exempt), one on sales of goods and services (including food, housing, and medicine), and one on business income (investments and purchases from other businesses are deductible; wages, however, are not). But most Americans will end up paying all three of those taxes, for a combined tax rate of 27 percent of their income.

That’s because middle and low-income Americans get all, or nearly all, of their income from ordinary wages — all of which would be subject to Cain’s 9 percent wage tax — and then they spend all of their income, which means it would be taxed again by the 9 percent sales tax. Finally, the burden of the 9 percent business income tax would be passed on to them as well, either in the form of lower wages — since wages are not deductible — or in the form of higher prices for goods and services.

The bottom line is that most Americans will pay all three of Cain’s taxes, making their real federal tax rate 27 percent. Compare that to the current tax code, under which someone in the bottom quintile pays two percent of their income in federal taxes and someone in the middle quintile pays 15 percent. The fact is that pretty much everyone making up to around $100,000 a year would pay more under Cain’s plan than they do now.


The good news here for you if you happen to be among the "working poor" which we must assume lies somewhere within Cain's $100,000 or below box, you can probably still make ends meet while paying the much higher total tax rate because Cain promises you'll be working a second job, anyway.

When questioned on the Face The Nation television program as to exactly how his economic plan would bring about an improvement in the economy, Cain responded that his plan would expand employment so much that "the working poor would be able to hold two jobs."


We could ask Cain what he thinks about pizza delivery as a moonlighting option but I'm not sure Godfather's ever offered that service. Besides, as is often the case with Cain when pressed for details, the odds are he has "no idea".

I wonder if Gene's Po Boys is still looking for help.

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