CNBC versus the GOP

Last night the GOP candidates went into hostile Michigan to face a hostile set of moderators who were booed into sticking to economic issues by the crowd after an unfair detour against Herman Cain.  In all, the night turned into somewhat of a circus.  Hopefully, the GOP will shun CNBC in the future, as this was the worst and most unprofessional case of moderation we have seen.    But aside from that, let’s get to the winners and losers.  First up…

It floored me when they tried to ask if companies should be making a profit or growing jobs.  Excuse me, but how the heck do you create jobs if you aren’t making a profit?? Gingrich’s response was beautiful. Watching the moderator rolling her eyes when Gingrich said a 30 second answer on healthcare was ridiculous was fun to watch.  But my favorite answer of Gingrich’s was on education, where he offered a real life example of a real life solution that addresses the issue of education that is getting exponentially expensive with much cheaper results.  As someone who works full-time, is a full-time grad student and has been in college for a decade following various business and religious pursuits, I connected with Gingrich’s answer and could not agree more.  This morning Neil Boortz in a morning phonecall to WOKV implied that Republicans needed to worry about who could beat Obama, not who would be the best President speaking of Newt Gingrich.  Bull.  Gingrich keeps winning debates because he is the smartest man on that stage.  And he made a joke out of those bombastic, rude moderators.

Rick Santorum did well.  This doesn’t mean anything, he still can’t win.  But he did highlight his leadership on things like medical savings accounts and gave viewers no reason to mark him down.  He has struggled in debates, but performed well last night.  Ron Paul also did a good job.  He avoided saying anything outlandish and produced a solid, constitutionalist approach.  Bachmann did well, but was once again forgettable.  Huntsman also did pretty well, though his attempt at “answer this in 30 seconds?” humor sounded like a lame, screwed up retelling of a good joke.

Mitt Romney needs to understand his precarious position.  He is stuck at 30%.  The rest of the GOP voters are looking for not-Mitt-Romney as their candidate.  His smoothness, economic savvy, and gaffe free debate performances have gotten him this far (along with a great deal of establishment money).  He needs to figure out how to get himself the rest of the way.  He has to find a way to make Social Conservatives trust him. Mitt, if you are listening, make a major statement in favor of state personhood amendments.  Consider that step one to breaking into the 40s in the polls.

Herman Cain also has hit a roadblock, but it is a policy roadblock.  I think many viewers were left with the feeling that if nuclear missiles were airborne from China heading for the US, President Cain would be on the phone with the Chinese President telling him how his bold plan, the 9-9-9 plan, could solve their problems by growing China’s economy.  9-9-9 is to Herman Cain what Windex was to Tula’s family in My Big Fat Greek Wedding.  This one dimensionalism will leave him open to a Gingrich rise.  On the other hand, Cain did very well defending himself against accusations which are more and more looking like racist smears from the Axelrod/Democrat machine.

Rick, Rick, Rick.  By the way, if you want to see the sexism of the left, just watch how long Perry’s crash and burn stays in the media cycle and blogosphere compared to a Palin or Bachmann gaffe.  Talk about not being ready for primetime.  I think Perry likes to start talking and get rolling, and that’s why he sometimes forgets what he was talking about mid-sentence.  No excuses.  You are running for President of the United States.  Running before you secure the ball is how you lose games.  Running your mouth before you have your answer and grasp on the issues is what makes Presidents say stupid things.  E.g. Barack Obama talking about police officers who arrested his professor friend.

Trunkline 2012: Tuesday Tidbits From The Republican Presidential Race – 11/08/11

Bookmark and Share  Today, White House 2012 brings you Herman Cain’s press conference, Iranian nukes, Obama’s anti-Netanyahu remarks, Gallups confirmation of American views, the President’s problem with prayer, and much more in today’s Trunkline 2012.

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Gingrich vs. Perry. Whose Tax Plan is More Effective?

   Bookmark and Share  On Tuesday, former Speaker Newt Gingrich was quick to compare his flat tax proposal to that of Texas Governor Rick Perry’s flat tax plan which was released earlier in the day.

In his comparison, Newt convincingly argues that his plan is better than Perry’s.  Gingrich is also quick to point out that while the flat tax concept is something which Perry only recently decided to run with, he has been an ardent supporter of flat tax reform since as far back as 1997 when he stated that “There are things I would like to do like a flat tax with virtual elimination of the IRS.”

The biggest distinguishing aspect of Gingrich’s and Perry’s flat tax plan is the rates which the two men arrive at.  While Perry set’s a high 20% flat rate for both corporate and personal income taxes, Newt Gingrich proposed two separate rates and each one is lower than Perry’s.  In Gingrich’s plan, which predates Perry’s, the Speaker calls for a 12.5% corporate flat tax and and a 15% personal flat tax rate.

Other distinguishing features of the two plans involve capital gains taxes, deductions for charitable giving and home ownership, and payroll taxes.

While Gingrich’s optional flat tax system seeks to eventually replace payroll taxes with personal accounts that  yield better results. Perry’s plan does not change the payroll tax at all.  And on the issue of capital gains and  deductions for charitable giving and home ownership, Newt argues that Rick Perry is adopting a liberal class warfare approach that only gives such deductions and eliminates capital gains taxes on  those making $500,000 a year or less.  Newt’s plan fairly offers it to everyone. [For the actual comparison and a list of references demonstrating Newt’s longstanding committment to a flat tax, see the table and lists that the Gingrich campaign provided, at the bottom of this post]

While Perry’s plan is most definitely a good one, and touches on a few things that Newt’s does not seem to, such as abolishing the tax on Social Security benefits, Newt’s plan seems to benefit economic growth more than Rick Perry’s does. Much of the reason for that is simply based on the fact that Gingrich’s rate is much lower than Perry’s.  In addition to that, Newt Gingrich has offered significant entitlement reforms that go far beyond anything that Perry has toyed with.  Together, those two factors alone make Newt Gingrich’s plan stronger than Rick Perry’s.

In a previous post, White House 2012 gave Perry’s plan which he calls Cut, Cap and Balance, two thumbs up.  Perry’s plan still gets both thumbs up.  However; the plan which Newt Gingrich proposed long before Rick Perry put his proposal out,  gets three, not two thumbs up.

Meanwhile both men have done better than all their opponents on this issue.  For his part, Mitt Romney offered a 59 point plan that included some tinkering with the tax code, but failed to realize that he is tinkering with a tax code that is defective and needs to junked.  And while his plan is a solid and accetable program of pro-growth policies, it fails to acknowledge the simple reality that we will be much better off scrapping the existing tax code instead of tinkering with it.

As for Herman Cain,  I am no fan of his hybridized version of a flat tax and a little disappointed in Cain’s evolution on this issue.

Cain was initially calling for a Fair Tax, which is more accurately described as a national sales tax.  The one day he suddenly turned it into 9-9-9, a plan that offers a 9% corporate tax rate, a 9% personal income tax rate, and a 9% national sales tax.  That is a plan I cannot support simply because I refuse to give the federal government the authority to play with a new tax…..the sales tax.

Of course Gingrich and Perry and even Romney may still change their own plans as this campaign plays out, but so far, Gingrich and Perry are at least on the right path to the right reforms and currently, I find Gingrich’s path to be the most prosperous one for the nation.  The big questions now is, which one can best sell their plan and which one can use it in a way that will get their campaigns moving in the right direction and win them the votes they need to become the Republican presidential nominee?

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The following was provided by the Gingrich presidential campaign

Let’s Bump Plans: A Comparison of Gingrich and Perry’s Flat Tax Plans

Gingrich’s Plan Far Bolder than Perry’s Plan and Will Lead to Far More Robust Job Creation and Capital Investment in United States

Gingrich Perry Verdict: Gingrich Plan Better
Rate 15% 20% Gingrich has advocated for several years an optional flat tax rate of 15%, which when coupled with Gingrich’s bold entitlement and regulatory reforms, will usher in another era of booming economic growth and new, higher-paying jobs. The Perry rate of 20% is higher than the 17% that Steve Forbes proposed in his 1996 and 2000 presidential campaign.
Who Gets to Make Deductions for Charitable Giving and Home Ownership?? Everyone Families making less than $500,000/year By creating two separate classes of taxpayers, the Perry plan buys into the same class warfare that characterizes the Obama and Romney economic plans. The fact that there are still two brackets – even under a supposed “flat tax” plan – calls into question whether this is really a flat tax at all.
State and Local Tax Deductions Not deductible in optional flat tax plan Deductible in optional flat tax plan The Gingrich plan has a lower rate so less need for state and local deductions.  The deduction is a federal subsidy for states to adopt higher state and local taxes. Removing the subsidy would lead states to reduce state and local taxes, or adopt their own flat tax reforms. The Perry plan erodes states’ competitive advantages by making state and local taxes deductible in his optional flat tax plan.
Who Benefits from Elimination of Capital Gains Tax? Everyone Depends whether capital gains is long term or short term.  Perry’s plan eliminates cap gains only for long term. The Gingrich plan maximizes the capital investment and job creation that will accompany the elimination of this tax. The Perry plan only goes halfway, and by levying up to 35% tax on short-term capital gains, it will discourage investment, venture capital, and new jobs creation.
Corporate Income Tax 12.5% 20% The Gingrich plan will create a boom of new American entrepreneurship by dramatically cutting the corporate tax rate to one of the lowest in the developed world. The Perry plan relies upon a short term “tax holiday,” then only drops the corporate tax rate to 20% — only average in the developed world, and still over 20% higher than our closest economic competitor Canada, which has a rate of only 16.5%.  Gingrich rate makes U.S. more competitive than Canada.
Payroll Taxes Eventually replace payroll tax with personal accounts, financing better results No change in existing payroll tax Gingrich supports personal savings investment and insurance accounts that would eventually be expanded to finance all of the benefits now financed by the payroll tax, allowing that tax ultimately to be phased out altogether.
Earned Income Tax Credit (EITC) and Child Tax Credit Both the EITC and the Child Tax Credit are preserved in Gingrich’s optional flat tax system. No information provided. Preserving the EITC and Child Tax Credit are critical to ensure that the optional flat tax system does not unfairly target low-income Americans. Gingrich passed the first child tax credit as Speaker in 1997, and will preserve this credit and the EITC under his optional flat tax system.
Record in Achieving Dramatic Jobs and Economic Recovery at the National Level? Yes. Substantial. See record at right. None. Speaker Gingrich’s Record (1995-1999):•    Eleven Million New Jobs
•    Four Straight Balanced Budgets for the First Time Since the 1920s.
•    Unemployment rate of 4.2%.
•    Federal Spending Held to the Slowest Growth Rate Since the Early 1950s (avg. of 2.9% a year).
•    Venture capital investments grew 500% in three years and manufacturing sector grew to 17.43 million jobs.
•    Bipartisan Welfare Reform that Lifted Millions from Poverty.
•    Over $400 Billion of National Debt Paid Down

Gingrich’s Advocacy of the Flat Tax Dates Back to 1997

From Item 2 in Gingrich’s 21st Century Contract with America (September 29, 2011)

All tax filers would be given the option to pay their income taxes subject to current income tax provisions or to pay under a lower single rate of taxation with limited deductions.

Release of Jobs and Prosperity Plan Upon Announcement of Campaign (May 13, 2011)
Move toward an optional flat tax of 15% that would allow Americans the freedom to choose to file their taxes on a postcard, saving hundreds of billions in unnecessary costs each year.

In his 2010 book, To Save America
To generate another lasting economic boom, we need fundamental tax reform, similar to that proposed by Steve Forbes. We should adopt the optional 15 percent flat tax with generous personal exemptions.

In his 2008 book, Real Change
This concept of an optional flat tax was developed by Steve Forbes when his flat tax campaign was undermined by criticisms that it would take away popular tax breaks. Steve Forbes and Stephen Moore have both proposed giving American taxpayers an opportunity to choose simplicity versus complexity and a single rate over a lot of deductions. They call it the free choice flat tax, and it’s an idea whose time has come.

In a 2008 National Review op-ed with Texas Representative Michael Burgess
An optional flat tax would save taxpayers more than $100 billion per year and reduce compliance costs by over 90 percent. This is a stimulus package that would have an immediate effect on our American economy.

In Foreword to Steve Forbes’ 2005 Book Flat Tax Revolution
I believe there is a real opportunity for a similar grass roots revolution imposing the flat tax on Washington. As people learn how much money and time they can save through a flat tax they are going to demand a simple alternative to the complexity and uncertainty of the Internal Revenue Service. As people spend hours in frustrating and seemingly endless paperwork and record keeping and preparing they are going to demand the freedom for their own time offered by a flat tax….As people watch the endless maneuvering of the lobbyists and the special interests they are going to demand the fairness of a flat tax.

As Speaker of the House in 1997
There are things I would like to do like a flat tax with virtual elimination of the IRS.

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Perry gets one chance to resurrect his election campaign with his Tax Plan.

Bookmark and Share   After a difficult month which saw him plummet in most national polls, Governor Rick Perry, today launched his much anticipated Flat Tax plan. Making the announcement, Perry said, “The goal of my ‘Cut, Balance and Grow’ plan is to unleash job creation, address the current economic crisis, while at the same time generating a stable source of revenue to address our record deficit and put our fiscal house in order.”

“The flat tax will unleash growth but growth’s not enough,” Perry said. “We must put a stop to this entitlement culture that risks the financial solvency of this country for future generations. I mean the red flags are alarming.”

Perry called for corporate tax reform, including a one-time reduced tax rate of 5.25% for businesses that bring their profits that are parked overseas back to the U.S.

The U.S. Chamber of Commerce estimates this one-time tax reduction would bring more than $1 trillion in capital back to the U.S. create up to 2.9 million jobs, and increase economic output by $360 billion,” he said.

“In other words, it’s the kind of economic stimulus President Obama could have achieved if he wasn’t hell-bent on passing big government schemes that have failed American workers,” he said.

Perry’s plan may seem very attractive and indeed, the most attractive aspect of the plan is that it gives most American’s a “Choice.” It doesn’t stipulate you must do X, it says to ordinary American’s you have these two options, A or B.

As we saw recently with Herman Cain’s plan, people like simplicity however, Governor Perry is going to come under intense scrutiny over the next week from the media regarding his plans. I welcome the plan because it is a departure from previous elections and like Herman Cain and Newt Gingrich, it is bold in wanting to reform the unnecessary tax code which, most American’s having mountains of paperwork to work through annually to get their tax returns completed.

The one big problem I see with Governor Perry’s plan ironically, is the very person who has been credited with lending Perry a lot of support in establishing it, Steve Forbes. Inside the first hour, I witnessed Forbes on a major media outlet supporting the plan.

I admire Steve Forbes and in fact, it was his innovative thinking back in the 1996 campaign that many credit as the root of today’s Perry plan. The harsh fact is this however, Perry needs to be able to convince American on his own and sell them the plan on his own. Herman Cain has been doing it with his 9-9-9 plan, former speaker Gingrich with his “New Contract for America,” and even President Obama has been touring the country trying to sell his jobs bill.

Perry needs to show American’s on a national stage that he can demonstrate the leadership qualities and convince them about the direction he wants to take the country. In the $17 million dollars he raised in the last quarter, $10 million of that came from within Texas, he’ll need extend his appeal beyond the Lone Star State to prove a credible and serious challenger to President Obama nationally.

While I like the “Choice” feature of Governor Perry’s plan, the next week is crucial. He needs to stand independent of Steve Forbes and sell his own ‘Cut, Balance and Grow’ plan and hopefully, Perry’s communication’s team, will have already set it up for Steve Forbes, to limit his air time talking about Perry’s plan.

My experience about business dealing in America tells me one thing; American’s admire creativity and innovation. If Perry stumbles during interviews or gets labelled as Steve Forbes 2.0 his chances of resurrecting his campaign nationally will all but disappear. I wish the Governor well however.

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Perry’s Cut, Cap and Balance Flat Tax Plan is a Winner But Will it Make Him a Winner?

  Bookmark and Share  In advance of his announcement of a flat tax proposal that would be the most dramatic tax reform in the nation’s history, Governor Rick Perry penned a summary of his proposal in this mornings Wall Street Journal .

Calling his proposal “Cut, Balance and Grow”, Perry hopes to balance the federal budget by 2020 and explains that his plan will abolish the death tax and give taxpayers the option to pay their current income tax rate or a new 20% flat tax that “preserves mortgage interest, charitable and state and local tax exemptions for families earning less than $500,000 annually, and  increase the standard deduction to $12,500 for individuals and dependents.”   In addition to a 20% personal income tax, the Perry plan will also adopt a lowers the corporate tax rate to 20% and encourage the swift repatriation of nearly $1.4 trillionthat are currently hidden overseas by temporarily lowering the rate to 5.25%.  The third part of his flat tax proposal includes what he calls a transition to a “territorial tax system”, that will only tax income earned in the United States.

Perry’s plan also calls for the elimination of the tax on Social Security benefits, a change that will supposedly boost the income of 17 million current Social Security recipients.

Governor Perry argues that without significant changes, our nations will go the way of Europe and be mired in a longterm debt crisis that will only get worse than the one we are currently experiencing and to help avoid that in addition to his new flat tax reform he attempts to cut, cap and balance federal spending habits by capping federal spending at 18% of our gross domestic product, banning earmarks and future bailouts, and passing a Balanced Budget Amendment to the Constitution. Additionally he will freeze federal civilian hiring and salaries until the budget is balanced and enact an immediate moratorium on pending federal regulations while also mandating  a full audit of all regulations passed since 2008 to determine their need, impact and effect on job creation.

In what is a direct nod to his need to shore up those voters who are fearful about Perry’s past remarks about Social Security being a Ponzi scheme and as such, something which he would seek to eliminate, Perry’s plan touches entitle reforms, an issue which needs to be addressed and which Perry’s plan does not address enough. His proposal merely declares that he will preserve benefits for current and near-term Social Security beneficiaries, by permanently prohibiting “politicians from raiding” the Social Security trust fund.

That part of his plan is the most politically shallow aspect of his proposal.  While he addresses that issue under the category of entitlements, he does not really address all of the entitlement reforms that are burdening the budget now and will bust it in the future.  It is also worth mentioning that it is nearly, if not totally impossible for a President to vouch for the permanent inability of Congress to “raid” any fund.  President’s come and go.  The mentality that relies on political expediency among Congress lasts forever.

In general, Perry’s Cut, Cap, and Balance plan is one of the most comprehensive and promising plans to come down the pike in decades.  One of the most, but the not only one.  Others have proposed similiar flat tax based plans and one of the major differences between those other plans and Perry’s plan is that at 20%, Rick Perry sets his flat tax at a rate significanlty higher than most all others.  That high 20% rate is probably the least attractive aspect of Perry’s plan.

Insofar as reform goes, it is much more solid than the light on detail, 9-9-9, hybridized flat tax proposal of Herman Cain and when it comes to the issue of reform, Perry’s proposal outshines even Ronald Reagan’s, Jack Kemp inspired, lower taxation, supply side economics plan of the 80’s.  That plan simply adjusted the existing tax code and while it was in no way insignificant, Perry’s plan admits that the tax code is not worth tinkering with and needs to be scrapped and replaced by something that will allow America to be competitive in the modern global economy.

In a previous post I indicated that if Perry proposes a good flat tax plan and can market it properly and exploit the promise that exists in a flat tax from a politically strategic point of view, than he can reestablish himself as a frontrunner, or at least within reasonable striking distance of such a status.  Now that the relative details of his plan are out, I can honestly say that despite my belief that his 20% rate is too high,  if he can build his campaign around this plan and make it a focal point of the overall Republican nomination contest, than Rick Perry will have many fruitful themes to touch upon and run on.  Now is just a matter of developing an effective campaign strategy and organization that can force the other candidates to run around his promising, conservative based economic plan and reforms. Bookmark and Share

RIP Cain’s 9-9-9 Plan

So much for simple.  After heavy criticism of his 9-9-9 plan, Herman Cain is retooling it to look a whole lot more like the current income tax code.  Cain plans on adding empowerment zones for poor neighborhoods, which is no surprise, but also adding tax brackets and exemptions.  Cain’s caving will not satisfy Republicans like Michele Bachmann who said everyone should pay taxes and then attacked Cain’s plan, or Democrats who have portrayed Cain as the devil for trying to come up with a fairer system.  What it does do is knock the legs out from under Cain’s campaign by removing the one base of support he could count on: the Fairtax, limited government crowd.

Another issue for Cain’s new progressive approach to his formerly flat 9-9-9 plan is that he proves himself wrong in his assertion that it would be a solid, unchangeable plan that future Presidents couldn’t tinker with.  One of the key elements to a flat tax is that it gets government out of the business of picking winners and losers, giving advantages to people in their districts, or buying votes through sin taxes and tax breaks for good behavior.  With Cain’s empowerment zone approach, there is a risk of taxes being a political selling point to the extent that they are now.

Rethinking Cain's effectiveness on flat and fair taxes

The complexity of empowerment zones, brackets and exemptions for good behavior will bog this system down in compliance issues.  The sales tax will basically replace the payroll tax on a business’s to do list, but with added complexities if that is possible.

Anyone with a “get rid of the IRS” bumper sticker may need to rethink Herman Cain.

Newt’s rebirth: Romney’s innocence: Cain’s oops

Give Newt a chance?

That seems to be the message coming from GOP grassroots following another commanding debate performance in Nevada.  Newt Gingrich is announcing on his Facebook page that contributions over the last four days have exceeded what he took in for the entire month of July.

With some of this campaign cash, Newt is making moves in New Hampshire and hopes to hit other early states as well.

To date, Newt Gingrich’s campaign was slowed by an apathetic start, low fundraising, and staff defections.  The general mood towards Newt Gingrich has been that everyone will admit he is the smartest man in the room, but nobody thinks he can get elected.  Un-electability has cost him financial support in a catch 22 situation where he has found it hard to raise the sort of excitement that gets people to fork over even small donations.  In many cases people like Newt in theory, but can think of better things to spend their cash on.

Newt also has the misfortune of having a public record far longer than any other candidate out there.  From the Clinton impeachment to his three wives, Newt has plenty of baggage.  However, none of this baggage is fresh.  This could prove to be an advantage over candidates who have made much more recent slip ups that are fresh in people’s minds.

Romney’s Illegal Aliens

Rick Perry may have made a critical error in attacking Mitt Romney for “hiring illegal aliens”.  This was a flimsy charge when it was made in 2008 and has not become any more serious since then.  Such a mean spirited attack on such a baseless charge is not what Republicans want to see candidates doing to each other.  Perry may be believing some of the religious conservative hype coming from his side of the ring: that getting rid of Romney is as high a priority as getting rid of Obama. 

Most conservatives would rather see Obama go, even if it means electing someone not as socially conservative.  Romney is not going to go down over this illegal immigration charge, and for a good reason.  Romney didn’t hire illegal aliens.

In fact, as an accountant myself, I would wager that under the criteria given by Rick Perry I could discover illegal aliens that Rick Perry has “hired”.  Romney hired a legal US company to perform services for him.  That company broke the law and hired illegal aliens without Romney’s knowledge or direction.  When Romney found out, he gave them one chance to fix it and then fired them.

So, has Rick Perry eaten at any restaurants along the border?  Has he ever used the services of any company that hired illegal aliens?  Give me unfettered access to his check books and credit records and I can easily find you the illegal aliens Perry has “hired” by this criteria.

Besides, did Nannygate in the Clinton administration change one voter’s mind?  Stick to the Issues, Rick Perry.

Cain talking himself out of contention

For two straight debates, 9-9-9 has played a significant role in tax discussion.  Cain is tapping the anti-IRS Fairtax group in the country with step one on the way to a national sales tax.  But the Fairtax has always overpromised on things it could not deliver.  9-9-9 actually makes the Fairtax look pretty good.  Cain has lucked out so far since no candidate attacking his plan seems to understand his plan.  But eventually word will get out on some of the real flaws in it, such as the basis for the 9% corporate tax.

The 9% corporate tax is on gross minus purchases.  For service  intensive industries such as consulting firms, temp agencies, and other such businesses, that 9% tax could easily turn into an effective 90% tax or even higher.  How?  Picture a company that makes $1.1 million gross per year.  They are a consulting firm with $100,000 in expenses and $900,000 in payroll costs resulting in $100,000 in profit.  Under Cain’s plan, it they leave the $100,000 profit in the business, they will be taxed on 9% of $1 million, or $90,000.  Of course, $90,000 tax on $100,000 net profit is a 90% corporate tax.

Now Cain has made another misstep on abortion.  At the same time, he practically handed out endorsements to his two biggest competitors, Mitt Romney and Newt Gingrich.

Cain continues to establish his amateur status and lack of political savvy.  Some voters will find that endearing, especially in our polished political world.  Others will start questioning just how much they can trust Cain to hold the line on important principles and give fast, correct answers in one of the most demanding jobs on the planet.

Rick Perry’s Flat Tax Could Get Him Back in the Game

 Bookmark and Share   Texas Governor Rick Perry’s decision to propose a flat tax offers the type of bold and realistic leadership that could help him regain his footing and get back some of the traction that he lost in the weeks following his entrance into the Republican presidential nomination contest.

Before becoming an official candidate for President, I saw great potential in Perry’s campaign.  I even believed that his bold declaration to make government as inconsequential in our livesas possible, to be a good sign of a brave, new, conservative leader who was willing to think outside of the box and provide voters disenchanted with the establishment, with a promising new leadership alternative in the 2012 election.  Unfortunately though, what I can only describe as a poorly orchestrated campaign strategy, Perry seemingly squandered his chance to maintain the level of support and faith in  him that he began his campaign with.

Part of the reason for Perry’s slide from the top was due to his extremely poor debate performances, most notably his charge that those who disagreed with his desire to reward illegal immigrants with reduced tuition fees for their college educations were heartless.  But a big part of the Perry slide was also his campaign’s inept ability at damage control,  something that is bound to be needed even in the best ran campaigns.  And the other major factor was the degree to which Perry seemed to be unprepared to run.

When asked a question about jobs and the economy during a debate, Perry actually stated that he would have a plan soon.  That was an incredibly inadequate answer to a question dealing with what is undisputable the most important, immediate issue facing the nation he seeks to be President of.   In many ways, the manner in which Perry has handled himself, especially in the debates, allowed people, to put it nicely, to question how bright Perry is.   How smart Perry is is something which I too have been forced to question.

But it is by no means too late for Perry to get back in the game and his intellectual capacity is not a foregone conclusion yet.  We all make mistakes.  Bedsides, Perry does actually have  good political instincts, even though he has not shown them recently, he has been thrice elected Governor of Texas.  He has the ability to raise levels of money that will allow him to be competitive if he spends itwisely, he has an effective team of knowledgable political consultants and strategists who have the ability to run an effective campaign, and he has the opportunity to seize the support of a broad spectrum of Republicans who remain either dissatisfied with the existing field of Republican presidential candidates or are not yet fully uncommitted to any one of them.   But to take advantage of this, Governor Perry now needs an angle that will provide voters with a simple and solid reason to still consider his candidacy.  His proposal of a flat tax does that.

I have argued that like Herman Cain, Mitt Romney needed to propose something bold and contradict the status quo of the political establishment.  I argued for Romney to propose a simple, straightforward, flat tax.  It has been my opinion that since Romney is largely viewed as an establishment candidate in what is an anti-establishment environment, he needs to come up with solutions that are new and different and could allow voters to see him in a new light.  But thatis not how Romney has acted.  Instead, Romney proposed a plan that even though it is undoubtedly a solid, pro-growth economic policy, it still did little to help him capture the needed impression of being more than a status quo politician.  What he did do was present a 59 point plan that simply created the impression of his being a typical bureaucrat.

My reasons for arguing that Romney use a flat tax plan to show himself to be a reform minded, anti-establishment leader, has always been primarily based upon the merits behind a simplified flat tax code.

As the federal government continues to participate in excesses that have its roots in and endless increase in its  size and scope, it operates in a vicious cycle.  The more it seeks to control the people, the more expensive it becomes to enforce those controls.  And as they incur those costs to legislate our lives away, they turnaround and raise  our taxes to pay for it.   In this cycle not only does the federal government take more control over us, they take more of our money away from us, thereby  taking more control away from us by inhibiting our individual economic opportunities and  freedoms.

This cycle must stop.

Our current tax code is unfair and unjust.  It penalizes success, deters wealth, stunts economic growth and employment opportunities, and feeds the bureaucratic monster of a behemoth federal government that infringes on our freedom more than it defends it.

Under the current arcane tax structure, nearly 50% of the population pays nothing into the federal system.  Yet this same 49 or so percent of the population are the ones who are either in part or entirely, sustained by the federal government.    This socialist style  system of federal sustenance has eroded our free markets, the American entrepreneurial spirit, and is undermining our economy and people.  It perpetuates a culture of dependency and promotes an entitlement society, that takes more than it gives.

That is why we need real, major……….. in fact, dramatic tax reform.

Herman Cain understands that.  Hence his 9-9-9 plan.

But Cain’s hybridized flat tax creates too many problems of its own, not to mention a new national sales tax.  Not only does that fly in the face of “no new taxes”, it creates more new ways to tax the people.  And while there are many statistical metrics that can be manipulated to promote or oppose the sales tax and Cain’s 9-9-9 plan, the bottom line is that I do not want to give government the authority to abuse a new and additional form of taxation.

That is why I have long proposed what I call a National Tax Equity Bill that abolishes our current failed tax code and replaces it with a flat tax.;

Roughly stated, my flat tax plan consists of the following major components

 A flat tax rate on individuals and businesses as outlined below with a rate of 18%, that, after three years, will level off  at 15.5% of what’s left of the total annual income from all wages, salaries, and pensions after subtracting a personal allowance.

Those four allowances would be:

– $26,600 for married filling jointly

– $16,850 for single head of household

– $13,650 for single

– $5,300 for each dependent child

Other aspect of my plan include;

A provision calling for employment-based health insurance to individuals with annuals earnings under $55,000, in the form of refundable, advanceable tax credits and would give families  up to $5,700 a year and individuals up$2,300 to buy insurance and invest in Health Savings Accounts.
And most critical to my plan is a clause calling for the following;
The requirement of a 2/3 majority for passage and adoption to:
  • -Rais or reduce the flat tax rate
  • -Extend or eliminate allowances
  • -Create any new penalty taxes
  • Borrow money to pay for general expenses

All of this may be too much to hope for in Perry’s plan. But at least Rick Perry is prepared to to put himself forth as a mainstream American politician who is willing to do what most other mainstream or establishment politicians are not willing to do……stop tinkering with a tax code that is a lemon and replacing it with a better, more reliable, and more equitable tax system, that is devoid of loopholes and significantly reduces the size and invasiveness of the I.R.S.

The advantages of a Flat Tax are endless and undeniable.  The principal arguments in its favor are growth, fairness, how it will dramatically lower rates and put an end to the tax code’s bias against savings and investments, and will boost the economy’s performance when compared with the present tax code.

One of the most persuasive arguments for a flat tax is its  fairness. The current convoluted tax system with all its complicated documents, manuals, and forms, would be replaced by simple instructions and a simple, small postcard-like form.  Furthermore its simplicity does not allow for the type of loopholes which give special advantages to those who wield political power.

As stated by Daniel Mitchell, Ph.D. of the Heritage Foundation, if enacted, a flat tax would yield major benefits to the nation, including faster economic growth, simplicity, fairness, put an end to micromanaging and political favoritism, produce increased civil liberties, and increase our edge in global competitiveness.  And unlike those arguing for a national sales tax by calling it a “fair tax”, a flat tax is just what it calls itself.  It is flat and it is also proven.  Over the last 20 years, those nations which have adopted a mild flat tax rate, account for the fasting growing economies in  the world.

And speaking from a political standpoint in the sense of both the Republican nomination contest and the general election, a flat tax offers an incredibly powerful and unifying message of the creation of an equitable tax code that is one rate for one nation.  No one is asked to pay a higher percentage for their citizenship than anyone else and being successful is not penalized.

Given Perry’s willingness to endorse and propose a flat tax, while I can not say that it is enough to make me endorse him at this point in time.  It is enough to make me willing to still consider him as a viable option.

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Trunkline 2012: Wednesday’s Wit and Words from the Campaign Trail, 10/19/11

Bookmark and SharePerry prepares to call for a flat tax while conservatives look down on him, Herman Cain fans launch questionable endless spending super PAC, New Hampshire pushes Nevada, Romney and Cain slug it out in the South, Newt Gingrich writes about death by Bureaucracy, Communists endorse Occupy Wall. Street protests, and Michelle Malkin talks about Harry Reid and President Obama’s uselessness.  That’s just some of what is in todays, news from the campaign trail in Trunkline 2012

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Time to thin the herd

All is not lost!  Yes, it was an ugly night for several GOP candidates.  Newt’s frustration with the format is certainly understandable.  It made for great television, but it was a bad debate.  However, there were some glimmers of hope, starting with the Vegas Champ…

Newt Gingrich.  I didn’t give Newt the win last time because I didn’t think his campaign would see a boost.  After this debate, I think it will.  Newt once again is the adult in the room.  He puts himself above the fray and really acts as a second moderator.  Voters should give Newt a second look.  Give Newt seven debates with Barack Obama and Obama might even drop out of the race before November.  I would love to see these debates as more candidates drop out and more time is given.  Newt has been so supportive of other candidates that his questions of other candidates carried a great deal of weight and were therefore more devastating.  Cain will not survive the 999 barrage, look for Newt to pick up steam.  Newt’s statement on faith put him squarely in the majority of conservative thought.  Newt’s biggest slip up was on appearing weak on states rights.  Another candidate who performed well, but likely won’t see much change because of it was…

Mitt Romney.  Romney was once again the big punching bag, and once again hit back.  He continued to defend his healthcare program as a state program and did pretty well.  But here Newt hit him hard on the big government aspect of it.    Romney kept his cool when being shouted down by Rick Santorum and talked over by Rick Perry.  Romney screwed up on Cain’s 999 plan trying to argue that Cain’s plan would add federal taxes to state taxes.  Excuse me, Mr. Romney, but you already pay bushels of apples and oranges.  Don’t feel bad, every candidate but Cain and Newt seemed to forget that 999 would eliminate our current tax code.  In the end, especially with no Huntsman, Romney’s got his support base solidified and did nothing to hurt that. Unfortunately, this is the last good report on a candidate performance in this review.  Although, it wasn’t terrible for everyone, especially…

Michele Bachmann.  Michele, Michele, Michele.  First, Obama took us to Libya, THEN, he took us into Africa!  Oops, Libya is in Africa.  But again, if Joe Biden can be VP, we shouldn’t be too hard on Bachmann for her frequent misspeaks.  Aside from that, she did well in another forgettable performance/turned stump speech.   As a tax litigation attorney though, I am disappointed in her evaluation of Cain’s 999 plan.  A VAT because every corporation in the manufacturing process pays 9%?  What does our current corporate tax do?  Same thing.  Shame on you Michele.  But most people won’t figure that out, so you’re good.  We will see if the media picks up on Bachmann’s idea of a $1 poor tax.  Bachmann won’t see any uptick from this debate.  Another candidate with no uptick or downtick…

Ron Paul. Paul is good on state’s rights.  The other candidates would do well to learn some things from him.  On the other hand, we heard a lot of the same platitudes and fuzzy one liners that leave us scratching our heads about if Paul actually has a viable plan.  Get rid of the income tax?  Oh, ok.  Is that like repealing Medicare part D?  Would be nice, but not a priority?  Paul came out with a new economic plan that cuts a trillion in spending.  Worth taking a look at, but didn’t get much play last night.  He will maintain his small support base, but with his vagueness and legend over substance approach this debate won’t give him a bump.  But at least he won’t lose support, like…

Herman Cain.  Cain gave the media some pretty good quotes last night.  Would he shut down Guantanamo to negotiate with terrorists?  Kinda sounded like it.  Apples and Oranges?  Cain, that is simply not Washington speak.  Cain looked amateurish.    He is an amateur though, so he may get a pass for the inability to articulate his 999 plan in a way that Americans can understand and latch on to.  Fortunately, his opponents weren’t much better.  In fact, only Newt seemed to have a clue how 999 works, but he wasn’t about to throw Cain a bone.  Cain right now is riding on populism, but poor debate performances can sink that ship (Bachmann, Perry).  In fact, I think it did sink two ships last night, starting with…

Rick Santorum.  Rick continues to be an advocate for the family.  He continues to present strong conservatism.  But his discussion with Romney early on just set a bad tone.  He reminded me of an angry teenager.  It was unprofessional and amateurish.  It’s been good to have Santorum in these debates for the most part, but after last night he needs to drop out and endorse a social conservative who can still beat Romney.  You’re not going to win, Rick Santorum.  At this point you are hurting more than helping.  But at least Santorum did better than…

Rick Perry.  Geez.  I don’t want to sound politically incorrect, but Perry seemed…slow.  Can we still use that term?  When Romney was answering and Perry was slowly drawling over him and droning on, I couldn’t help but laugh.  But it got worse as the night went on.  Perry, who gave instate tuition to illegals and opposes a full border fence, went after Romney for hiring a landscaping company that hired illegal aliens.  And that wasn’t the only 2008 unfair attack that Perry dug up.  Even when Perry made a good point (We need to uh, look at, uh the…darn, which amendment was it again?  Oh yeah, tenth amendment for uh…issues) it was lost in translation.  Perry was put in his place over and over.  It was a complete dud.  Even his distancing from Pastor Jeffers was not believable.  The best we got from Perry was a promise that next week he will have a tax plan. The good news is that even Rick Perry had a better week than…

Barack Obama.  Rumor has it, after a bunch of his tour supplies were stolen, that his teleprompter is currently being interrogated by Iranian sponsored Al Qaida terrorists in Mexico.  Although, there have also been alleged sightings of his teleprompter in Zuccoti park, smoking a joint and displaying a message about being overworked and underpaid.

Welcome to the top, Herman Cain

The most recent debate is over, and Herman Cain is discovering what Rick Perry felt like when he was the front runner.  The way the debate went, there was clear recognition of Cain, Romney and Perry as front runners.  The other candidates almost seemed to be helping in the vetting process as though they were seeking to help Americans choose from one of those top three.   So here goes, the latest debate in retrospect.  And the winner is…

Romney back in the driver seat

Mitt Romney.  Mitt Romney had some good news today.  He picked up an endorsement from Chris Christie, which is huge.  He also had some bad news.  Rush Limbaugh questioned Romney’s conservatism compared to other candidates and gave the death knell that took down Mitch Daniels, Tim Pawlenty and Jon Huntsman.  Rush called him the Republican establishment candidate.  Still, Romney was his usual comfortable self.  His adopting the Trump doctrine on China will help build that portion of his base.  Cain did Romney a huge favor by asking him about his 59 point plan and giving him the chance to explain it and expound on it.  In fact, the questioning session turned into an opportunity for the other candidates to seem to vet the apparent front runner candidate.  Romney’s own question to Michele Bachmann was very gracious and showed the kind of class that simply makes Romney likeable.  Romney’s answer on Dodd Frank was pure gold.  He was polished and Presidential.  Romney still has to get a little bit stronger on his conservative stances and lose a bit of that obvious shine in order to pick up more of the anti-politician minded rightwing, especially the TEA party.  But for this debate, Romney managed to edge out…

Newt Gingrich.  Newt Gingrich is the best debater.  As the best debater, Newt spewed pure common sense.  His best was when he bluntly spoke about how absolutely stupid the debt commission is.  His answers put him above the fray and he maintained his mantra that any candidate on that stage would be better than Obama.  However, Newt did not get enough face time.  He took no arrows, shot no arrows at the other candidates, but simply did not have enough chances to speak to make a difference.  Newt has won several of these debates, but winning these debates is not enough for him at this point.  He must so completely knock each debate out of the park that everytime a front runner falls he is there to pick up the pieces.  In this case, he did not even mention his campaign’s new contract with America.  It was a lost opportunity.   So far he has not accomplished what he needs to do in these debates.  I can’t give him first, no matter how well deserved.  But as a representative of the Social Conservative flavor of this party, he did outperform…

Cain has his work cut out for him

Herman Cain.  Cain’s 9 9 9 plan finally got the inspection it deserved.  A striking moment was when Rick Santorum polled the audience on who wanted a new 9% sales tax, and who thought a 9% flat income tax would stay at 9%.  Not a single hand in the audience was visible.  Santorum hit the nail on the head.  The result is Cain will be in trouble after this debate.  He must now find a way to explain his plan in a way that resonates with Americans.  He made a good start when he talked about how the 9% sales tax would replace a 15% payroll tax, which of course we all pay.  If he can hit that point and solve the question of how to prevent future Presidents from turning his 9 9 9 plan into a 35 35 35 plan, he can salvage his front runner (by my calculations) status.  Cain took a huge hit on the federal reserve when Paul questioned him too.  Later when he spoke about fixing the Fed, Paul made easy work out of Cain.  Still, his likeability level and pure down home realness will keep him afloat for at least one more round.  At this point, if Cain falters I predict voters will finally give Newt Gingrich a second look.  Another candidate they might be looking at is…

Rick Santorum.  Rick Santorum did very well.  He made a key point when he said he did not support the bailout.  He called out Cain’s 9 9 9 plan and struck a very strong blow on it.  He exposed Cain’s naivete beautifully.  But that was the extent of Santorum’s stunning performance.  Like Gingrich, he simply did not get enough other face time to make a huge difference.  No one is afraid of him becoming the front runner any time soon, so there wasn’t much interest in him among the debate moderators.  While Santorum did not make a strong case for himself as President, he certainly gave voters a lot to think about with the latest rising star in Herman Cain.  That may be his purpose at this point.  There is very little chance of his campaign being successful.  Almost as little chance as…

Jon Huntsman.  Jon Huntsman did not do bad for the most part.  His answer on China will not connect with Americans and for a good reason.  Being nice to China does not sell when as Romney pointed out we are already losing to them because they are cheating.  Two debates ago I said Huntsman’s campaign is over.  Nothing changed with the debate tonight.  Feeling our pain because he helped run the family business and was a good governor is so cliche at this point, it’s really forgettable.  But not as forgettable as…

Michele Bachmann.  Michele Bachmann did well.  She spoke on Obama’s failures and conservatism.  But mostly she was forgettable.  At one point, it sounded like she said she raised 28 children, 22 foster and 5 biological.  I could understand, with that many kids, how easy it would be to get the math wrong.  But it’s not good when that’s what sticks out in my mind.  No highlights, no major gaffes, and in fact her role in Congress became even more forgettable when Gingrich asked why the House has not made any move to repeal Dodd Frank or Sarbanes Oxley.  I was left wondering where her actual leadership has manifested itself.  The exchange with Romney was her one saving grace, proving that at least she is not one dimensional unlike…

Popularity off the debate stage won't save these candidates from earning low marks in this debate.

Ron Paul.  Ron Paul did ok.  He made it pretty clear he isn’t a fan of the fed.  But on the fed, especially Bernanke, Newt stole his thunder.  What else did Paul speak about?  Again, another forgettable candidate.  Paul fans, don’t hate me for saying that.  Step outside of the movement for a minute and ask yourself if he truly made a splash.  Did we hear anything new about Ron Paul that would make us want to make him in charge of everything the President of the United States is responsible for?  No, but I’d be happy to see him head up the Fed audit once we get a President who has that as a priority (which apparently is not Herman Cain).  But even Ron Paul did better than…

Rick Perry.  Rick Perry came across as a something between a walking cliche and a deer in the headlights.  He simply does not debate well.  He again was slow in his responses and his wording did not connect.  He came across as very unprepared once again.  His good answers were copies of other candidates, and his bad answers seemed to drag on with his drawl.  I’ve said before that I would love to see Newt Gingrich debate Obama.  I would not love to see Perry debate Obama.  I’m not sure I would be able to watch.  Can Perry turn things around?  Possibly.  I’m not ready to give him the Dead Candidate Walking title along with Huntsman just yet.

Huckabee’s Fair Tax Mistake

Bookmark and Share Mike Huckabee has released an editorial promoting the virtues of a national sales tax or as he calls it the Fair Tax.

He writes;

Hopefully by now youre somewhat familiar with how the FairTax works, but if not let me explain it briefly: You get rid of all income and payroll taxes and you get rid of corporate taxes completely. When someone tells you corporations should be taxed more – remember, if more taxes are put on a corporation – the corporation is simply going to raise the prices of their products to cover the increase – passing the increased cost to you.

That sounds good but it is also typical Mike Huckabee.deceptive.

Now I shouldnt be too hard on Huckabee. He does at least have the guts to propose true reform of a tax system that is obsolete, chaotic, oppressive, and a hindrance to economic growth. We need a presidential candidate and President who will not simply tinker with a broken system but prepared to support a cash for clunkers like approach to our tax code by junking it and replacing it with a system that does not penalize success, oppress entrepreneurial innovation, and hold back our economy.

Huckabee is correct when he writes refers to tax reform in his editorial by writing , I do know we wont have a chance if we dont have the courage and leadership in Congress to see the task through. That is most certainly true. But that leadership must come from more than just Congress. Sweeping change must be supported by our Commander-in-Chief, the person who has the power of the bully pulpit behind them and who believes in the reforms that he or she convinces the nation of the need for.

But the Fair Tax is not the reform that this nation needs. First of all, the Fair Tax is anything but fair. If George Soros decides to have his help purchase televisions for all the bathrooms in all of his estates, he can afford the additional cost that a national sales tax places on his purchases. But for an average family that lives from pay check to pay check, the new national sales tax simply makes it harder for them to replace the one TV screen that they have had for 10 years and is displaying a screen with a picture that is shrinking.

For a family making $200,000 a year, a rise in the cost of all products may be affordable but for too many higher prices simply puts more products further out of the reach and places a significant burden on them.

Higher prices are not what I believe the Republican candidate for President or Congress should be proposing.

Instead I believe it is incumbent upon our Party and its candidates to demand that we abolish our current arcane tax code and replace it with a Flat Tax. Unlike the so-called Fair Tax, a Flat Tax is exactly what it says..flat. It is one rate for one nation. There is no discrimination, there is no hike in the costs of products and there is no penalizing of success. Instead, a Flat Tax offers tax relief, puts an end to loopholes, and grows our economy.

Of the last ten years, the fastest growing economies of the world have adopted a flat tax for their nations. The greatest examples of this exist in the former Soviet states of the Balkans. When they adopted a flat tax, they saw their economies boom and have maintained steady economic development and growth. Yet, the United States, still hangs on to our antiquated tax system, a system that only grows our economy whenever we tinker with it to reduce rates. And when we reduce rates, which area of debate is the greatest source of disagreement? Why it is who those reductions should go to. And from there inevitable comes the debate on what constitutes defining one as rich.

The Flat Tax puts an end to all those debates. With a Flat Tax rate of say, 14%, the wealthy still pay a greater percentage than do the less wealthy. 14% of 40 million comes out to be much more than does 14% of 40 thousand. And unlike Mike Huckabees national sales tax, it does unduly burden families with higher costs. In fact for many, it lowers the amount of money that the government currently takes from them.

Huckabee understands that we need real change in America. That is a good thing, but what he does not realize is that the change he proposes does more harm than good and if he really wants to promote tax fairness, then the Flat Tax, one rate for one nation is the way to go.

Government does not produce wealth and it is not naturally sustainable. The people and the entrepreneurial spirit of America through its free markets, are what creates wealth and sustains our government. That is why I believe we must eliminate our current oppressive tax code, a tax code that rewards failure must go. We need leadership that will implement what I call a National Economic Recovery and Responsibility plan that will help spark our economy, reduce spending and put America back on the road to a steady, growing, stable economy. As such I offer my own detailed tax reform plan for Governor Huckabee to consider in place of his national sales tax.

I.-The National Tax Equity Act

(For a detailed explanation click on thebill titlelink above)

1. A flat tax rate on individuals and businesses shall be adopted as outlined below with a rate of 18% that, after three years, will level off at 15.5% of whats left of the total annual income from all wages, salaries, and pensions after subtracting a personal allowance.

Those four allowances would be:

  • – $26,600 for married filling jointly
  • – $16,850 for single head of household
  • – $13,650 for single
  • – $5,300 for each dependent child
1.A Individual gross earnings up to 2 times the established poverty level (based upon the year preceding) are exempt from taxation. All income above that level shall be taxed at the specified rate.

1.B Businesses and Corporations with gross earnings up to the value resulting from multiplying the number of legal US resident employees in the business against 2 times the established poverty level (based on the year preceding) shall be exempt from taxation with all gross income above that level taxed at the specified rate.

1.C– All corporations will be taxed by the same single national tax rate and they will take their total income, subtract total expenses and if the result is a positive amount (profit), they will pay tax on that amount at a the national tax rate.

2.A – All Businesses and Corporations thatexceed federalenergy efficiency and environmental standardswill be entitled to an annual dedcution of10%the amount oftheir annual profit.

2.B-All individual home amd property owners thatexceed federalenergy efficiency and environmental standardswill be entitled to an annual dedcution of10%the amount oftheir annual profit.

3.A -There shall be an exemption up to but not to exceed the greater of 10% of gross annual income or 25% of the annual median income, applied to College Savings Accounts, Individual Retirement Accounts (IRA), Money Market Accounts and Certificates of Deposits.

3.B– Allow for the automatic deposit of tax refunds that are based onthe rate of savings formula implemented upon passage of thefederally insuredPrivatizedFuture Security Annuity Accountsprogram that will take the place of SSI.(see proposed PFSA program here)

3.C-Provide employment-based health insurance to individuals with annuals earnings under $55,000, in the form of refundable, advanceable tax credits. Families would get up to $5,700 a year and individuals up$2,300 to buy insurance and invest in Health Savings Accounts

4. Social Security benefits are exempt from taxation.

5. A complete 100% exemption from the flat tax for spouses of military personnel deployed in a theatre of battle to be effective from the time of deployment to the end of the calendar year after deployment ends.

6– The following will hereby require a 2/3 majority for passage and adoption:

-Raising or reducing the flat tax rate

  • -Extending or eliminating tax credits
  • -Increasing or decreasing the rate of a penalty tax
  • -Creating any new penalty taxes
  • -Borrowing money to pay for general expenses
7. Direct income from inheritance settlements are exempt from taxation.

8. Specific provisions for implementation to be determined by a Congressional review committee with input from regulators, industry representatives and budget experts

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Gingrich Presents His Tax Plan in New Hampshire

Bookmark and Share Speaking to an audience at New Hampshires St. Anselm College in Manchester, Newt Gingrich laid out a tax plan that claims will shift nearly 2/3 of the people on unemployment and dependent on government, into becoming independent, self sufficient, taxpayers and thereby be the single biggest step you can take back toward balancing the budget,

The former Speaker of the House and likely presidential candidate called for cutting the capital gains tax to zero, making the so-called George Bush tax cuts permanent, eliminating the estate tax, an allowance for companies to write off 100% of new equipment purchases in the first year, and a 12.5 percent corporate tax rate.

Gingrich explained that reasonable tax rates will prevent companies like General Electric from sheltering profits to avoid paying federal taxes. He also stated that the slight increase of jobs recently added to the market only occurred after President agreed to extend the Bush tax cuts for another year. He added though, that businesses still remain leery to adding jobs because those tax cuts are set to expire and if they do, businesses will take a hit that they are prepared for.

Gingrichs plan is seemingly sound, but is it truly brave and bold, or is it just the same cut tax mantra that Republicans have always rightly called for? Dont get me wrong, tax cuts are necessary, but we can keep on raising and lowering taxes and tinkering with a broken tax code for the next two hundred years. Or we can fix the broken and antiquated tax system by calling for bold reforms such as a flat tax.

Personally I am disappointed in Newts tax proposal. As someone who has a proven record as an innovator, I expect more from him than the same old solution, a solution we must repeat every time Democrats raise taxes. A Flat tax would truly spur economic growth. In the case of former Soviet bloc nations, such a taxcode created some of the fastest growing economies in the world. A Flat tax is one rate for one nation and its time for Republicans to demonstrate the will to bring about true reform and show some true vision.

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