Herman Cain's wrong number
If there’s one thing people notice about Herman Cain during the recent presidential debates, it is that he consistently focuses on specific solutions to specific problems. He is a consummate executive. Even Mitt Romney whose managerial experience is unquestioned somehow seems unfocused compared to the laser-like intensity with which Cain sticks to problem-solving.
A perfect example came in the recent Fox News/Google Republican debate in which Mr. Cain was asked to name a department of the federal government which he would eliminate. After responding (to applause) that he’d get rid of the current EPA and start over, he pivoted to a solution for another problem: “Now, with the rest of my time, may I offer a solution for Social Security, rather than continuing to talk about what to call it? I have proposed the Chilean model. It's been around 30 years, and it works.” Typical Cain, and part of what is so appealing about him.
Of Mr. Cain’s many ideas, the most well-known – in part because of its clever sound-bite name – is his 9-9-9 plan which aims to replace most current federal taxes (including income tax, death tax, payroll tax, capital gains taxes, and double-taxation of dividends) with a 9% flat tax for business income, a 9% flat tax for individual income, and a 9% national sales tax. The plan would eliminate almost all deductions.
While Mr. Cain’s consistent results-oriented approach is admirable – not least for its contrast with the other candidates – voters should be wary of the 9-9-9 plan despite its initial appeal. In short, it is somewhere between folly and economic suicide to implement a national sales tax, even at a modest rate, without simultaneously repealing the 16th Amendment to the Constitution (which permits a national income tax.)
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