Give Cain's 9-9-9 plan a fair shake

Ryan Streeter
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Herman Cain has been turning heads lately. Most have considered him an outsider, unelectable at best. And yet voters have begun to regard him as a top-tier candidate, if a recent Fox News poll is to be believed.

His performance in recent debates has helped him. But so has his consistent, repeated claims about his 9-9-9 plan. Unlike Romney's 59 point economic plan, widely panned as unoriginal, Cain's plan is much simpler and much more original (meaning, also, much less likely to become an actual law).

Cain's plan is clearly too extreme for today's politicians. It's hard to imagine it passing into law any time in the next decade. Still, as Josheph Curl recently wrote in the Washington Times: 

A flat income tax of 9 percent would bring in about $1.12 trillion. Corporate taxes at 9 percent — about $270 billion. A national 9 percent sales tax, about $378 billion.

That’s only (only!) $1.768 trillion, well short of what this year’s tax revenue of $2.16 trillion. But wait. With some hefty growth (and using a projection not far above the Obama administration’s own estimates), the 9 percent income tax would bring in about $1.4 trillion, corporate taxes an estimated $321 billion, and the national sales tax about $450 billion. Boom — $2.17 trillion.

Sure, that’s well short of the $3.8 trillion Mr. Obama wants to spend, but it does at least match up with current revenue. And, hmm, maybe America should spend less, and, this is crazy, try to match its expenditures with its revenues.

It's hard to imagine an income tax and corporate tax set at the same rate as a (generally regressive) sales tax, but there's a lot to like about Cain's proposal. It would help restrain spending while keeping us current with our public obligations. It would also make filing your annual taxes a heck of a lot easier.

Comments

[Ricardo's Ghost]

Absurd.

The argument is that if the US cuts spending back to $2.17tr now (something no-one has an idea how or appetite to do), then Cain's plan will provide enough money to pay for it all in about 5 years time if growth runs at a very high 4.5% a year, every year, from now on.

[Numbat9]

Ricardo's Ghost -

Surely the point (as any plan is when campaigning) is to clearly define and distinguish a candidate. The public's recognition / knowledge of Cain during the primary campaign to-date has increased dramatically as a result of this plan (however unaffordable / unlikely it is to be made law).

It also helps to frame the debate: if Cain's plan forces Romney, Perry et al to respond, all of a sudden Cain is setting the terms of the debate and builds momentum because the discussion has switched to one of the things the public knows about him - that he has a plan on tax which is easily understood.