9-9-9 :: I'll play

[EagleKeeper]

Why didn't prices go down when the FAA partially shutdown, i.e., no FAA tax was being collected?

Airlines were not stupid.

They knew that the suspension of the tax was temporary and that it would be installed retroactively.

 

[Gamingphreek]

$100k isn't middle class. You're in the top 20% of the population. Even at 75k you're in the top 27%. And that's for households, while you're single, which means you're even richer than you think.

Instead of a calculation error you made a reality error.

I am most definitely 100% not rich. I'm sorry you feel the need to try and make me feel guilty for the amount of money that I make as well.

Loudoun County is the wealthiest county in the United States - it takes a lot of money just to live here. My rent alone is >$1300 a month and that is on the low side of things for a 1 bed/bath 600+ square feet apartment.

Now don't get me wrong - I am able to afford a nicety here and there, but I have to work very hard to manage my finances to make sure everything is going to the right place.

What is so hard for you to understand that poorer people pretty much pay all of their money out just to survive and richer people have more income that doesn't have to be used to live? Are you familiar with the concepts of 'fixed' and 'variable' costs for a business? There are certain costs that a business will incur regardless if they sell a single item. Think of the poor as having all of their income wrapped up in fixed costs. They are gonna have to pay it regardless.

Someone mentioned an exception for food. I have heard there isn't one so that's another big hit for the poor unless they can find some used food. Hey who wants used food? Let me just say, I am not anti-business but don't be surprised if businesses try to cut pay or at least not give raises because they don't get the payroll deduction anymore even though their total taxes have gone down. They'll try it until something (the market?) makes them not do it.

Cain has already said that people who are below the poverty line will receive a rebate check of some type. If you are above the poverty line, while I disagree that the poverty line is accurate, sorry.

Additionally, if they don't like their situation work to change it. Cain was poor and has managed to flip the scales.

That is a pretty cynical view on businesses. You honestly think that, after saving money from taxes, they are greedy enough to not only not give raises and raise their prices? What in the world is stopping them from doing that right now.

 

[sactoking]

Well the argument I hear is that the tax burden shifts to the Middle and Lower Income families which is very clearly false.

You're right, it is quite clearly false. I mean, the fact that taxes would go up for 84% of US households isn't shifting the burden at all. Households with incomes between $10,000 and $20,000 would see their tax burdens go up up to 950%. Households with incomes between $40,000 and $50,000 would see tax increases of $4,400 per year. Households with incomes between $50,000 and $75,000 would see tax increases of $$4,326 per year. Households with incomes over $1,000,000 would see their tax burdens cut in half. That's not a shift at all.

http://finance.yahoo.com/news/84-would-pay-more-under-Cains-cnnm-2299109136.html?x=0&.v=1

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.

Those are some of the estimates from the Tax Policy Center's analysis of Cain's proposal, which has helped make him a leading contender for the Republican 2012 presidential nomination.

While some key questions about the 9-9-9 plan remain unanswered, the Tax Policy Center's analysis is one of the first to take a comprehensive look at its potential impact.

Cain's 9-9-9 plan would replace much of the current tax code with a flat-rate system: a 9% individual income tax; a 9% corporate income tax and a 9% national sales tax. Estate and gift taxes would be eliminated, as would the payroll tax, and most tax credits, deductions and exemptions.

In terms of investment taxes, capital gains would be tax-free, while dividends would be deductible to businesses paying them out but taxable at 9% for investors who receive them.

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.

Cain's tax plan: More than 9-9-9

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

There are two reasons for that discrepancy between the poor and the rich.

First, while the Cain campaign has said it is working on ways to lessen the tax burden on low-income households, the Tax Policy Center said it didn't have enough detail to assume what that change would be. One way to address regressivity is to offer a rebate to low-income households.

The second reason has to do with how Cain would restructure taxes.

Under the current system, most of the lowest income households end up owing no federal income tax. That's because their incomes are so low that they're exempt, or because their tax liability is canceled out by the standard deduction and tax breaks, such as the Earned Income Tax Credit.

The Cain plan doesn't exempt very low incomes from taxation. And while it would eliminate the payroll tax, which is the heaviest tax for low-income families, that tax relief would be offset for many by the elimination of the EITC and other tax breaks they qualify for now.

But 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.

Under Cain, capital gains -- a notable source of income for the wealthiest Americans -- would be tax-free. He would also preserve the charitable deduction. And taxing all non-capital gains income at 9% would amount to a considerable break from today's top rate of 35%.

Cain's plan has been criticized by those on the left, who say it would hurt the poor, and those on the right, who worry a new national sales tax is an invitation for the government to raise taxes over time.

Cain has said his plan would raise the same amount of revenue as the current system. The Tax Policy Center generally concurs with that assertion.

In 2013, the group estimates that Cain's plan could raise about $2.55 trillion. That represents 15.4% of expected GDP, well below the historical average for tax receipts.

But Cain's plan would not raise as much revenue as the current system if he decided to offer a rebate to low-income households to lessen their tax burden.

The Cain campaign did not immediately reply to a request for comment.

 

[mshan]

Ron Insana on CNBC previously said that taxes have historically been about 18% of GDP, but have been 14% recently (recession obviously has something to do with it, but I doubt all).

I forgot exactly, but I think he also said 4% of unemployment number are construction workers (who no longer are building homes that no one needed yet then).

 

[Fern]

Ron Insana on CNBC previously said that taxes have historically been about 18% of GDP, but have been 14% recently (recession obviously has something to do with it, but I doubt all).
-snip-

IMO the recession has an awful to do with it.

As income across the board drops, the effective rate drops as more is taxed in the lower brackets and less in the higher brackets.

As for corporations, while they might have climbed back to profitability, initial losses suffered are, in many cases, being carried forward to offset current profits. This is no special rule, loss carry forwards have always been allowed.

Fern

 

[ElFenix]

$100k isn't middle class. You're in the top 20% of the population. Even at 75k you're in the top 27%. And that's for households, while you're single, which means you're even richer than you think.

Instead of a calculation error you made a reality error.

well, the tax code already takes care of a lot of that. because i'm childless and a renter my taxes are huge in comparison to a larger household.

stop the subsidies! get the government out of the housing market!

 

[shira]

I am most definitely 100% not rich. I'm sorry you feel the need to try and make me feel guilty for the amount of money that I make as well.

Loudoun County is the wealthiest county in the United States - it takes a lot of money just to live here. My rent alone is >$1300 a month and that is on the low side of things for a 1 bed/bath 600+ square feet apartment.

Now don't get me wrong - I am able to afford a nicety here and there, but I have to work very hard to manage my finances to make sure everything is going to the right place.



Cain has already said that people who are below the poverty line will receive a rebate check of some type. If you are above the poverty line, while I disagree that the poverty line is accurate, sorry.

Additionally, if they don't like their situation work to change it. Cain was poor and has managed to flip the scales.

That is a pretty cynical view on businesses. You honestly think that, after saving money from taxes, they are greedy enough to not only not give raises and raise their prices? What in the world is stopping them from doing that right now.

I think that businesses will behave so as to maximize profits, just like individuals do. I mean, why on earth would a business pay more than the "market price" for labor when they don't need to?

There's nothing inherently bad about businesses - they're motivated by the same things as individuals are. But the system shouldn't be structured to give an even bigger advantage to people who are already way ahead. There are always winners and losers with any tax change, but a change as blatantly regressive as 9-9-9 - especially when presented as a "solution" to the very problem is actually makes worse - is monstrous.

I'm not worried about 9-9-9 at all though: Cain doesn't have any chance at all of even getting the Republican nomination, let alone win the White House. The American press may be dysfunctional, but really bad candidates are eventually exposed for what they are. And Cain is rapidly approaching the end of his 15 minutes of fame.

 

[Gamingphreek]

I just looked at my finances over the last 1 year:

In that time I have spent:
$3681 on Food
$15847 on my Apartment
$3289 on Bills and Utilities

While a family of 4 would certainly be pushed a little bit, I fail to see how they would be spending >100% of their income.

For instance, they wouldn't be eating out as much as I do (Not much, but still a luxury). They wouldn't be spending $1300+ on an apartment (Even in Loudoun County, VA). They wouldn't have FiOS TV/Internet among other bills that I incur.

There shouldn't be people who pay absolutely NOTHING in taxes. If they want to give a tax break in this manner, everyone should be taxed on their salary less the poverty line.

I feel like I haven't heard a fair assessment of the 9-9-9 plan. I have heard a bunch of analyses with a liberal set of assumptions (Not to say that Cain's are neutral assumptions). I ran the numbers on my own finances and came out on top despite what all the charts/graphs display - anyone care to explain that?

-GP

 

[MomentsofSanity]

I just looked at my finances over the last 1 year:

In that time I have spent:
$3681 on Food
$15847 on my Apartment
$3289 on Bills and Utilities

While a family of 4 would certainly be pushed a little bit, I fail to see how they would be spending >100% of their income.

For instance, they wouldn't be eating out as much as I do (Not much, but still a luxury). They wouldn't be spending $1300+ on an apartment (Even in Loudoun County, VA). They wouldn't have FiOS TV/Internet among other bills that I incur.

There shouldn't be people who pay absolutely NOTHING in taxes. If they want to give a tax break in this manner, everyone should be taxed on their salary less the poverty line.

I feel like I haven't heard a fair assessment of the 9-9-9 plan. I have heard a bunch of analyses with a liberal set of assumptions (Not to say that Cain's are neutral assumptions). I ran the numbers on my own finances and came out on top despite what all the charts/graphs display - anyone care to explain that?

-GP

You fail to see it because you have no kids etc... to support. It's not so cut and dry. We get nickle and dimed from every angle from the schools right on down. To comment on it while really having any real world knowledge is a bit silly.

Your perspective will change once you have a wife, kids, etc... especially if you are trying to do so on one income or on two minimum wage or close incomes.

 

[Gamingphreek]

You fail to see it because you have no kids etc... to support. It's not so cut and dry. We get nickle and dimed from every angle from the schools right on down. To comment on it while really having any real world knowledge is a bit silly.

Your perspective will change once you have a wife, kids, etc... especially if you are trying to do so on one income or on two minimum wage or close incomes.

Even if you double or triple the price of food, it STILL isn't anywhere near 100% of the poverty line.

Additionally, if you are on the poverty line, your price of housing will be significantly less as you would be in subsidized housing.

Those are the only expenditures that you can't get used (Remember used goods are untaxed). Once again, you can add kids on there and it still isn't 100% of income.

-GP

 

[ElFenix]

There shouldn't be people who pay absolutely NOTHING in taxes. If they want to give a tax break in this manner, everyone should be taxed on their salary less the poverty line.

the only people who pay nothing in taxes are jobless.

I feel like I haven't heard a fair assessment of the 9-9-9 plan. I have heard a bunch of analyses with a liberal set of assumptions (Not to say that Cain's are neutral assumptions). I ran the numbers on my own finances and came out on top despite what all the charts/graphs display - anyone care to explain that?

-GP

brookings has been called liberal, conservative, and centrist, and has both dems and reps on its board. they analyzed it and believe it represents a giant tax windfall for the biggest earners.

 

[MomentsofSanity]

Even if you double or triple the price of food, it STILL isn't anywhere near 100% of the poverty line.

Additionally, if you are on the poverty line, your price of housing will be significantly less as you would be in subsidized housing.

Those are the only expenditures that you can't get used (Remember used goods are untaxed). Once again, you can add kids on there and it still isn't 100% of income.

-GP

If you think the only added cost for children is food I have no problem seeing why you don't understand.

 

[Gamingphreek]

If you think the only added cost for children is food I have no problem seeing why you don't understand.

It is the only thing the sales tax will affect since you can't get it used.

Obviously there are things here and there (Diapers if they are infants) that you can't get used, but, largely, outside of food, shelter, and bills, most things can be purchased used in some capacity -- that would eliminate the 9% sales tax for them.

-GP

 

[ElFenix]

It is the only thing the sales tax will affect since you can't get it used.

Obviously there are things here and there (Diapers if they are infants) that you can't get used, but, largely, outside of food, shelter, and bills, most things can be purchased used in some capacity -- that would eliminate the 9% sales tax for them.

-GP

and the increased cost of used goods now that more people are buying them to avoid the sales tax? you can't ignore that.

 

[BoomerD]

From my morning newspaper:

Analysts: Cain's 9-9-9 plan a windfall to rich, would increase tax burden of less wealthy
By STEVEN THOMMA
McClatchy Newspapers

WASHINGTON -- Herman Cain's 9-9-9 tax plan would give every American making more than $1 million an average tax cut of $455,000, according to a new independent analysis.

All Americans with incomes above $200,000 would get tax cuts under the Republican presidential candidate's dramatic proposal, according to the analysis by the Tax Policy Center, a joint effort of the Urban Institute and Brookings Institution, both respected center-left policy-research centers.

At the same time, those with incomes below $200,000 - 84 percent of taxpayers - would see their taxes increase under the Cain plan, according to the analysis, which is the first to look at precisely what would happen to different incomes under the proposal.

Cain's 9-9-9 plan has captured the imagination of many Republicans and fed his meteoric rise to the top tier in polls on the contest for the 2012 Republican presidential nomination. He proposes to replace all federal taxes with a 9 percent flat tax on personal income, a 9 percent flat tax on corporate income, and a 9 percent national sales tax.

He has been vague about the proposal's details, and his campaign has refused to answer questions from McClatchy Newspapers.

"I invite every American to do their own math, because most of these are knee-jerk reactions," Cain said in a debate with Republican rivals Tuesday night. "It does not raise taxes on those that are making the least."

He insisted in his CNN interview that his plan would not hit lower incomes.
The Tax Policy Center found a different result. It based its analysis on Cain's public comments and documents from Fiscal Associates, a firm that analyzed the plan for Cain.

The study found that high incomes would get tax cuts from the 9 percent flat tax. The wealthy now pay a 35 percent marginal rate on their income above $379,150.

Those with cash incomes between $200,000 and $500,000 would get an average tax cut of $11,155.

Those with cash incomes between $500,000 and $1 million would get an average tax cut of $59,489.

And those with incomes above $1 million would get the average tax cut of $455,247.

Tax increases would fall on all lower incomes, with the heaviest burden on the middle class, the Tax Policy Center found.

The breakdown:
-For those with incomes below $10,000, the average tax increase would be $1,122;

-For $10,000-$20,000, the average tax increase would be $2,705.

-For $20,000-$30,000, the average tax increase would be $3,833.

-For $30,000-$40,000, the average tax increase would be $4,196.

-For $40,000-$50,000, the average tax increase would be $4,399.

-For $50,000-$75,000, the average tax increase would be $4,326.

-For $75,000-$100,000, the average tax increase would be $4,368.

-For $100,000-$200,000, the average tax increase would be $2,105.

Looked at another way, the lowest fifth would see an average tax increase of $1,854.

The second-highest fifth would see an average tax increase of $3,898.

The third-highest would see an average tax increase of $4,330.

The fourth-highest would see an average tax increase of $4,299.

And the top 20 percent would see an average tax cut of $14,442.

All of those are based on the assumption that the Bush-era tax cuts would be extended.

The study also answered a key question about whether Cain's plan would be "revenue neutral" as he says, meaning it would raise the same amount of money as current tax law.

The study found that the Cain tax plan would raise about $2.55 trillion in tax revenue to finance the federal government if enacted in 2013. That would be "virtually the same amount" as the government would collect in 2013 if the Bush tax cuts are extended past their expiration at the end of 2012.

It would be $300 billion less, however, than the amount that would be collected in 2013 if the Bush tax cuts expire.

ON THE WEB
For the Tax Policy Center analysis: http://taxpolicycenter.org/taxtopics/Cain-9-9-9-plan.cfm

 

[Gamingphreek]

and the increased cost of used goods now that more people are buying them to avoid the sales tax? you can't ignore that.

You think they are all going to go up 9%?
You think that people who are can afford new everything are going to buy used just to get out of a tax?

BoomerD, there is another thread on that, but the paper is confusing. They are claiming those figures, but I just proved that I am saving money with this plan despite the fact that I should be seeing a $4368 tax increase.

Means there are some liberal assumptions trying to paint a bad picture. Not that the assumptions aren't valid, but they are presenting them without presenting a set of assumptions which support the plan either - they are there - I posted in the OP.

 

[MomentsofSanity]

It is the only thing the sales tax will affect since you can't get it used.

Obviously there are things here and there (Diapers if they are infants) that you can't get used, but, largely, outside of food, shelter, and bills, most things can be purchased used in some capacity -- that would eliminate the 9% sales tax for them.

-GP

I was referring to your assertion that a low income famly of four should have all this disposable income. You clearly just don't get this. Have some kids and then discuss the topic when you have an understanding of what's really involved.

And food is still NOT the only thing that would face taxation. School supplies, most clothing (go buy some used underwear, shoes, etc... and see how long they last or if you'd even consider it).

I have 3 kids, my wife runs her own business and we both make a good living and I simply can not understand how someone making minimum wage even survives. The attitude you seem to possess, as most on the right possess, is let them do without. No health insurance coverage, the luxury of new clothing etc... It's actually pretty disgusting.

 

[ElFenix]

You think they are all going to go up 9%?
You think that people who are can afford new everything are going to buy used just to get out of a tax?

some will.

Herman Cain's 9-9-9 tax plan would give every American making more than $1 million an average tax cut of $455,000, according to a new independent analysis.

that's the dumbest sentence i've read today. "every" and "average" really shouldn't be used together.

I have 3 kids, my wife runs her own business and we both make a good living and I simply can not understand how someone making minimum wage even survives.

for the most part they either live under mom's roof (high schoolers) or are in college. nearly no heads of household make minimum wage.

 

[sactoking]

BoomerD, there is another thread on that, but the paper is confusing.

No, it's actually pretty straightforward.

They are claiming those figures, but I just proved that I am saving money with this plan despite the fact that I should be seeing a $4368 tax increase.

you obviously don't know what averages and representative statistics mean.

Means there are some liberal assumptions trying to paint a bad picture.

No, it's a non-partisan look based on proven socio-economic models of the population.

Not that the assumptions aren't valid, but they are presenting them without presenting a set of assumptions which support the plan either - they are there - I posted in the OP.

There is no valid set of assumptions that supports the plan; any scenario crafted to do such would not be representative of the population and would thus be worthless.

 

[Gamingphreek]

No, it's actually pretty straightforward.


you obviously don't know what averages and representative statistics mean.


No, it's a non-partisan look based on proven socio-economic models of the population.


There is no valid set of assumptions that supports the plan; any scenario crafted to do such would not be representative of the population and would thus be worthless.

No it IS a liberal (Or at least anti-9-9-9) set of assumptions or they would note the cases of people like me. I feel like 23 years old and single while renting is a fairly common life situation to be in. Averages can be skewed by outlying extrema.

some will.

Some is not all.

I was referring to your assertion that a low income famly of four should have all this disposable income. You clearly just don't get this. Have some kids and then discuss the topic when you have an understanding of what's really involved.

And food is still NOT the only thing that would face taxation. School supplies, most clothing (go buy some used underwear, shoes, etc... and see how long they last or if you'd even consider it).

I have 3 kids, my wife runs her own business and we both make a good living and I simply can not understand how someone making minimum wage even survives. The attitude you seem to possess, as most on the right possess, is let them do without. No health insurance coverage, the luxury of new clothing etc... It's actually pretty disgusting.

MOST clothes can be second hand clothes. Obviously underwear and shoes are some exceptions. Nobody had mentioned anything about health insurance other than the fact that I included it as a bill that would have tax.

That is a pretty harsh interpretation of my attitude. I'm sorry that they are living in poverty. I give 10% of my income to charitable organizations (Church and Campus Ministries), the harsh attitude is really unnecessary.

With that in mind, this entitlement attitude has got to stop. If you are impoverished in the manner that we are talking, don't get a TV, don't get Cable, don't get Internet (Use the Library), don't buy a new car, don't buy a cell phone, don't go out to eat every night, stop buying alcohol and cigarettes, stop buying brand new items when used ones will do just as well. That isn't to say that all poor people do it, I'm just listing off a few money wasters that a lot of people feel like they are entitled to.

If I lost my job and knew my savings wouldn't hold out, you better believe I would start cutting those things ASAP. Is it fun? Is it fair? Not always. Sometimes; however, that's the cards that we are dealt and we have to make the best of them instead of asking others to fix the problems. Cain was "poorer than poor" and somehow managed to turn it around even during a time when his race hurt his socio-economic status.

If you don't think people can make more than minimum wage if they try, consider this: A single parent working 1 job at a McDonalds 5 days a week (Standard 8 hour day) almost makes the poverty line. Expand that to 7 days a week and they are over the poverty line. McDonalds is a place where, if you breath, you are able to be hired. There are plenty of retail, restaurants, etc... that pay well more than McDonalds too. Sometimes you have to suck it up, swallow your pride and do what it takes to make a living.

-GP