9-9-9: Simply Trickle Down

Simplicity is the foundation of many a great sales pitch: “$5 foot longs.” “Jobs, jobs, jobs.” “99 cents tacos on Taco Tuesday.” “Buck beer night.” Pitches that state their value proposition concisely, specifically, and memorably are powerful in both the retail and political marketplace. And at first blush, Herman Cain, the former Godfather’s Pizza CEO, looks to have himself an awesome presidential pitch strategy in “9-9-9.”

Under Cain’s “9-9-9” proposal, a big chunk of the federal tax code would be replaced with a flat 9% federal income tax, a new 9% federal sales tax and a 9% federal corporate tax. Like many great sales pitches, Herman’s husksterism is elegantly simple, digestible, understandable, symetrical and memorable. Moreover, “9-9-9” has the all the appeal of an IED planted alongside the IRS headquarters, a popular proposition among just about all taxpayers, particularly GOP activists.

Politically speaking, “9-9-9” just flat out sells. Almost overnight, it has made Cain — who also has swell ideas about electrocuting Mexicans and banning government service based on religious affiliation — a GOP presidential front-runner.

But at some point, even wildly popular political pitches get dissected by journalists and opponents. When that happens, I’m not convinced that the Niner Designer will survive the economic vivisection.

Tax experts such as a former chief-of-staff of the non-partisan congressional Joint Tax Committee, are now finding that “9-9-9” represents a tax increase for every household earning under $120,000/year. A family of four earning about $90,000/year would pay about $5,000 more annually. (In Cain currency, that’s roughly 417 one-topping medium-sized pizzas per year.) At the same time, under “9-9-9,” billiaonaire Warren Buffet last year would have paid no income tax.

In fact, a President Cain with a “9-9-9” in place would probably redistribute more of old Joe the Plumber’s wealth than any President in American history. The trickle down economics imbedded in Cain’s “9-9-9” might make even old Arthur Laffer blush.

So sure, simple sells, and right now simplicity is raising Cain. But will it sell long enough to make Citizen Cain our next President? Nein, nein, nein.

– Loveland

4 thoughts on “9-9-9: Simply Trickle Down

  1. PM. says:

    But will it make him the Republican candidate? Will it allow him to continue to lead in the polls? Will it allow him to sell more of his books?

    1. Joe Loveland says:

      Books? Certainly. 15 minutes of fame. For sure? Nominee? Outside shot. President? I can’t see the majority of struggling Americans voting themselves a massive tax increase.

  2. Joe Loveland says:

    From CNNMoney coverage of a Tax Policy Center analysis:

    84% would pay more under Cain’s 9-9-9 plan

    NEW YORK (CNNMoney) — Under Herman Cain’s 9-9-9 tax reform plan, 84% of U.S. households would pay more than they do under current tax policies, according to a report released Tuesday by a nonpartisan research group.

    And the impact would be felt most heavily by the lowest income groups.

    According to the Tax Policy Center, households with incomes below $30,000 would have, on average, between 16% and 20% less in after-tax income than they do today.

    By contrast, households making more than $200,000 would see their after-tax income grow by between 5% and 22% on average.

    …the majority of the highest income households would get a tax cut. For instance, 95% of those with more than $1 million in income would receive an average tax cut of $487,300.”

  3. john sherman says:

    I wonder how Cain would feel about a 9-9-9-9 program with the fourth 9 being payroll taxes. Currently most wage earners pay about 7% up to a cap of about $106,000 income. This means the kid bagging your groceries pays 7% if his pathetic wage while Arod pays about .02% of his wage. Bump the FICA up to 9% and remove the cap, and we can stop worrying about Social Security forever and be a lot more relaxed about Medicare,

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