Thursday, October 20, 2011

Some Pros and Cons On Herman Cain

This is an edited version of what I posted at Redbaiter's place

For Herman Cain Critics- Difference Between Sales Tax and VAT

Redbaiter is correct. Mr. Cain's critics are wrong to call his 9% sales tax a Value Added Tax. However, in concert with his proposed flat 9% corporate tax, it is adding taxes along the way that are ultimately paid by the consumer -- you and me. I discussed the other drawbacks which really need a good sounding and for which really are not being aired in these debates. It makes me shudder to see the issues I raise below not raised to national prominence.

First of all, most of our current financial problem stems from unbridled spending (supporting banks that had been forced to make unsound loans under threat of felony discrimination charges), so talk about the ways to tax, and about “revenue neutrality,” should really tick everybody off. Cut the unprincipled spending off! (Prosecute the CRA for felony extortion, and if any are already dead, dig their remains up and hang them in the halls of Congress.) Spending tax dollars and floating national debt must be stopped. Those who have funneled funds to reward political cronies should be prosecuted for violation of Fed procurement rules. I wish Mr. Cain — or anyone — spent more time on this than on trying to sell “revenue neutrality.”

Cut the damned spending.

Second. There are pros and cons with Mr. Cain’s plan.

Pro: I agree his national sales tax not a VAT primarily because the corporate flat tax is not on the whole price of the goods being transferred. A vat IS charged on the value at the point of transfer. People in America have not a clue about Value Added Taxes unless they have traveled to where they see it.
Cut the damned spending!

Con: However, if anyone thinks the IRS is bad now, wait to discover agents sticking their noses into every penny-ante transaction anyone engages in. That will be a real terror. There will be witch-hunts for black-marketeers such as Americans has never dreamed of. That nightmare is never mentioned when a national sales tax is brought up. Why the hell not?

Cut the damned spending.

Third. In that diagram above RB, the effect of the 9% corporate tax is not shown. Because it is not charged on delivery price does not mean it doesn’t impact consumer costs. Of course it does. Especially on imports that cannot be homegrown. This from Mr. Cain’s site: “Gross income less all purchases from other U.S. located businesses.” See that? There is a hidden tariff in that corporate tax.

And that doesn’t preclude additional tariffs and excises as Congress may choose to add, also not allowed to be deducted. Do you recall the historical disaster of the infamous Smoot-Halley Act of 1930?

This is long enough. I felt you want these thought added to this thread that Mr. Cain’s 9-9-9 act is no bed of roses as that chart might indicate. That 9% sales tax, even if not patrolled by IRS snoops and informants would still be accompanied by a 9% corp tax that even Mr. Cain must admit adds some aspect of a VAT in practice. The money to pay those corp taxes ultimately comes from the consumer.

Cut the damned spending you Statist bastards.

And while you’re at it, get rid of the watermelon EPA which has exceeded all bounds of legitimacy. Cut the spending on them to zero!

Added on:
One more symbolic Con. A big one.

Does Herman Cain have a deaf ear or something? Are his adviser’s all paid by the other side?

How can anyone have not warned him to choose 8-8-8 or 7-8-9 or whatever instead? Just to keep the Left from doing what you know they will do? Fly sky-writers all over the country to put 9-9-9 in the sky with “sign of the beast” written along side it. Alinsky rules being in play openly now, you know the Left projects its own evil upon its opponents, and turns everything upside down. This is like giving them a gift for which I cannot see working in our favor. They have proven that demonizing their opponents does not backfire more than it works for them. I only see an upside down result for us here.

This is the kind of psy-ops that power brokers pay good money to see inflicted on their opposition. I thought it was terrible political blindness for Michelle Bachmann to hire Ed Rollins as her campaign chief (now sidelined thank God). This easily flipped 9-9-9 symbol is far worse.


  1. I don't worry about 9-9-9. Herman Cain is enough by himself. And after it went through congress, there's no telling what it would be.
    But Cain would still be president and whatever he signed would be better than we'd get from Romney.

  2. Romney would be following Obama what Nixon was following LBJ: the tax collector for the Leftist programs.

    My complaint about 999/666 was a political afterthought, and I declared it as such. Mr. Cain is not a regular politician, but his advisers assuredly are "“Herman, I don’t care if you think you got 9-9-9 from God Himself, that number is too easy a target.”

    Once again, I shudder at the thought of IRS agents snooping into every damn transaction you can think of. Go back and read my other Cons. They are not political maybes, but real dangers. That they are not discussed ought to worry you far more than 999.

    What may save us from the national sales tax might very well be the fact that it is anti-constitutional. There is an explicit prohibition against taxing interstate commerce.

    I'd much rather have Herman Cain even with the suspicious things I've mentioned before rather than the awful stuff that Mr. Romney has told us he'd do. See this video Ed.

  3. I've been told you can' get rid of the Income Tax without an amendment, since it was imposed by amendment.

  4. That's correct Ed. The 16th amendment would need to be repealed by another amendment.

    To put through a national sales tax would also need an amendment for it to be legitimate. However, given the ways in which SCOTUS has bent the constitution in recent years, the Statists on the court will almost certainly buy a "compelling governmental interest" argument or some such balderdash to allow one to stand.


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