The 999 Plan Will Result In A Huge Deficit

Herman Cain’s boneheaded 999 plan has been receiving a lot of attention over the past few weeks as he is the current GOP frontrunner. There is no way that Herman Cain will even be relevant by January and his economic plan will be proven for the travesty that it is by next month. As long as Cain is enjoying his 15 minutes of fame I thought it would be interesting to take a look at his plan.The Cain plan is based on the following:

• A 9% Business Flat Tax
• A 9% Individual Flat Tax
• A 9% National Sales Tax
• A 0% Capital Gains Tax
• A 0% Payroll Tax
• No Deductions (Mortgage Interest Deduction, Standard Exemption)

Cain’s plan seems to be illogical and appears as if he may have pulled it off of one of those pizza box coupons. This plan makes absolutely no sense because it does not address how the federal government will meet its existing obligations. The federal government’s budget is not a household budget. There are existing commitments that already exist. The government’s deficit would balloon based on the tax rate of all individuals going to 18% and business taxes dropping to a 9% rate. What will happen to programs like Social Security and Medicare? How about the national defense? Where will the money come to pay to defend the country?

It also does not explain how state governments will be funded since the federal government is hitting every consumer with a 9% sales tax. Will this be in addition to the sales taxes charged by many states in the United States? Does he really expect people consumption to rise when people are being forced to pay 9% more for every single product.

Cain’s tax plan punishes those that are the poorest and rewards those that are the richest. The median household income in the country is now at $49,000 per year. Cain’s plan will raise taxes on everyone in the country that makes below $50,000. His plan takes absolutely no courageous whatsoever. Anyone can stick the poor and lower middle class with more taxes while pandering to rich individuals and corporations.

Since Republican presidential candidate Herman Cain has recently come out with his 999 plan. I figure that it is is only a matter of time before some political candidate comes out with an 888 plan. Or how about a 777 plan? What about a 555 plan? How about a 0 percent plan? That sounds even better!