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You probably know that former pizza mogul Herman Cain has a tax-reform plan he calls 9-9-9, a triple-decker version of a federal flat-tax program affecting personal income, purchases, and salaries payed by employers. He claims it will make the administration of taxation dirt simple while reducing everyone's tax burden. Paul Krugman's blog links to a Tax Policy Center analysis of Cain's 9-9-9 proposal with respect to its impact on US taxpayers. Anyone who learned about regressive taxation in school can correctly guess the results.
A middle income household making between about $64,000 and $110,000 would get hit with an average tax increase of about $4,300, lowering its after-tax income by more than 6 percent and increasing its average federal tax rate (including income, payroll, estate and its share of the corporate income tax) from 18.8 percent to 23.7 percent. By contrast, a taxpayer in the top 0.1% (who makes more than $2.7 million) would enjoy an average tax cut of nearly$1.4 million, increasing his after-tax income by nearly 27 percent. His average effective tax rate would be cut almost in half to 17.9 percent. In Cain’s world, a typical household making more than $2.7 million would pay a smaller share of its income in federal taxes than one making less than $18,000.So give it up for our GOP executive superhero of the week and his outstanding Plan 9-9-9 From Outer Space! Or at least do that if you wish to carpet-bomb the economy with kryptonite and dull your hunger pangs by eating lead paint chips.
By the way, the Tax Policy Center is no hippie commune; it's a joint project of the Brookings Institution and the Urban Institute. I don't know anything about the latter, but Brookings is a right-leaning think tank that is about as Establishment as you can get.
Do something! Send these people to North Korea. Can you get them certified. Have you tried brain surgery?
ReplyDeleteAmerica doesn't deserve such idiocy
Well.....
ReplyDeleteTrepanning comes to mind. But then we risk the Bruegel-esque nightmare of having no effect whatsoever. It's likely that the disparate parts of a 300+ million people nation, coupled with playing to the GOP base (early on) gives a lowest common denominator that, most assuredly, is a circus. Along with some bread and another recession I guess we're supposed to be happy. Barring wide spread plague, the proverbial dead hooker/live boy bed mate, or other truly calamitous event you can probably pencil in an incumbent win (especially given that a Romney candidate choice is akin to a child holding their nose and gulping down a Brussels sprout). But then what?
Zadok
Marginalia: I'm afraid America does deserve such idiocy as long as the majority is indifferent to it. Maybe the Occupy movement will be able to help people focus on who the villains in the spectacle really are. There's always room for differences of opinion---it's supposed to be a democracy!---but it seems pretty clear to me who are the deliberate and unapologetic vandals of our little experimental polity.
ReplyDeleteZadok: what then? Maybe the Occupy movement will raise the awareness of enough people to inspire a new generation of voters to register.