Cain

[Chris Santee]

and then, there was an investigation into Fannie & Freddie,
but NOOOOO, everything was fine at the government backed money lender:
http://www.youtube.com/watch?v=_MGT_cSi7Rs

[Chris Santee]

and the final video, you'll want speakers on:
http://www.youtube.com/watch?v=AiEWCnpNnBQ

I am now re-hijacking this negative thread back to the positive.
We were talking about Herman Cain, how's everyone feel about him ?

[GamingWeasel]

Bush pushed his policy of the "Ownership Society" (remember that?), which along with other factors, encouraged financial institutions to make bad mortages to people who really couldnt pay them.  He certainly deserves some of the blame for this particular disaster.  The largest amount of blame of course goes to the mortgage companies themselves, who got way too greedy.

The non-partisan Tax Policy Center released an analysis on Cain's 999 plan.

http://www.taxpolicycenter.org/index.cfm

If they are correct, this would be a very bad thing for poor and working-class people, whose taxes would go up very significantly.  The wealthy and ultra-rich would reap the benefits from it.  If the lower income levels have less money to spend, due to higher taxes, then the economy crashes again. 

I hadnt had a strong opinion until now about this plan, but this analysis and others has made up my mind.  Seems like a very bad deal for America.

Mirjo, I have also been appalled by the same apparent lack of compassion that you spoke about. 

As for capitalism, socialism, and whatever-other-isms, I say forget all that bull****.  Go with what actually works, and forget the stupid labels of ideologies.  Take the good elements of each one to make the best society possible, for the largest number of people.

[LauriH]

OK, so I dragged out the 2010 tax return and did the math (after all 9-9-9 is such a simple, easy plan).  Under Cain's simple, straight forward plan, my family would have payed $2990 more in federal income taxes.  That is $249 out of our family's monthly budget.  I don't even want to attempt to try to figure out how much a 9% federal sales tax would cost us.  It would be too depressing.

So, as many of you on this forum are fawning over this guy, I hope to hell this guy does not get elected.  I, for one, have no interest in buying the oranges this guy is trying to sell the people of America.

[Stand Alone Defense]

Hey what's fair is fair plain and simple.  Everyone should pay the same percent across the board unless there is a hardship maybe a cut off at a certain household income level. 

[GamingWeasel]

For example, for virtually everyone posting on this forum, their tax burden would go up (I doubt there are any millionaires and billionaires in Fairfax).  Clearly, calling that "fair" is total nonsense, especially as it hits the poorest the hardest.  This would send the economy back into recession, and cause another housing market crash as mortgage defaults and foreclosures soared again.

I suppose people who would support this plan could always volunteer to pay higher taxes, if it sounds so awesome…all in the interest of “fairness” of course.

Though as the conservative-elites (those who control the money and power) who rule the GOP seem to have started to line up behind Romney, the chance of anyone else winning the Republican nomination begins to fade.  The GOP establishment tends to go for the guy who is supposedly “next in line”, and this election seems to be shaping up no differently.  I think Cain will begin to fade soon, just as Trump, Bachmann and Perry did after their respective rises.  It seems increasingly certain it will be Romney vs Obama in 2012.

[Stand Alone Defense]

So it is fair in your eyes to stick the entire tax burden on the rich people who make a lot of money? I agree there needs to be a cut off for low income families but if make 40,000 a year or more I really don't think 9% is that much.  It is what 3600 bucks a year?  mind you that is based off gross income and is without any tax deductions either.  I pay more then that now!! So I guess I don't see where you all are coming from.

http://www.moneychimp.com/features/tax_brackets.htm

[mkr]

Josh, I hear ya.

Being Single, with no kids, don't get me started on what I pay for taxes...... I will not have an increase in taxes if this went through.

[GamingWeasel]

So it is fair in your eyes to stick the entire tax burden on the rich people who make a lot of money? I agree there needs to be a cut off for low income families but if make 40,000 a year or more I really don't think 9% is that much.  It is what 3600 bucks a year?  mind you that is based off gross income and is without any tax deductions either.  I pay more then that now!! So I guess I don't see where you all are coming from.

Nobody said anything about putting the "entire tax burden on the rich people".  You totally imagined that on your own.  The 999 plan proposes to remove loopholes and deductions, hence the "simplicity" of it, and one reason why most everyone would end up paying more.  The other reason being another 9% tax on purchases of almost everything.  These are an additional burden on the everyday tax-paying citizens.  The tax/economy problem is a large complicated issue, and we live in a large complex country.  To believe that a small simple solution will fix it is illogical, and pretty improbable.

How to fix it then?  Hell if know, but it is clear that this plan of Cain's is clearly a worse system for almost everyone than we already have, simple as it might be.  Simple is good, but if it doesnt work, that's irrelevant.

We need better ideas.  Ones that will actually work in the real world.

[mkr]

In response to the 9% Sales Tax.

9% National Sales Tax.
Unlike a state sales tax, which is an add-on tax that increases the price of goods and services, this is a replacement tax. It replaces taxes that are already embedded in selling prices. By replacing higher marginal rates in the production process with lower marginal rates, marginal production costs actually decline, which will lead to prices being the same or lower, not higher.

[LauriH]

Dear mkr,

Let me see if I understand what you are saying.  In my own words, you are saying that if a 9% national sales tax goes into effect, manufacturing costs will be lower, thus, out of the kindness of their hearts, corporations will lower the price of their goods?

Can I get the address of the dream world you are living in, because I would like to move there.

[Chris Santee]

Dear LauriH,

They wouldn't lower their prices out of the kindness of their hearts.
They would lower their prices to make more money.

When McDonalds came out with a 99 cent menu,
Burger King responded (wonder if this is where all the 9's came from?)
to make more money............

by lowering their prices !

[GamingWeasel]

Thanks MKR, that is good to clarify.  It is an additional 9% on top of the purchase prices which the plan supposes will fall, but independent analysis suggests that prices would not go down under the plan.  It looks like this could be wishful thinking of the Cain people who came up with these ideas.  I'd be interested to see more examination of this from other reputable organizations.

Here is one non-partisan organization's (Tax Policy Center) analysis of how people would fare overall under such a plan:



Take a look especially at how the least fortunate among our fellow citizens would do...ouch!  Even by overall measure, taxes go up by 1.2% when you include the losers (poor) and the winners (rich).

Personally, I would be paying almost $4500 more in taxes than under the current system.  In real-life terms that would mean we wouldnt have been able to do a lot of the home improvement that we did the past year, including significant weatherization to reduce our heating costs.  Consequently, we'd be spending more on heating oil, putting more pollution into the air, and sending that money overseas to foreign oil producers in lands where many people hate America, rather than hiring a local contractor and putting money in his pocket.  We wouldnt be starving, but sure wouldnt be happy about it.  Our 250 yr-old house needs fixing up.   That's also $4500 less going back into the economy, and therefore $4500 less for someone else to earn when I would have bought goods or services.  Less money flowing into the economy means economic slow-down, and consequent loss of jobs.  More people on the edge of financial ruin would be pushed over that cliff.  It's a lose, lose, lose, lose, lose prospect.

[Travis]

In response to the 9% Sales Tax.

9% National Sales Tax.
Unlike a state sales tax, which is an add-on tax that increases the price of goods and services, this is a replacement tax. It replaces taxes that are already embedded in selling prices. By replacing higher marginal rates in the production process with lower marginal rates, marginal production costs actually decline, which will lead to prices being the same or lower, not higher.

I have trouble believing this is correct. Every business purchases items to run their business. The 9% national sales tax will increase the cost to purchase everything from office supplies to furniture and computers. Plus without the loopholes and subsidies their margin will most likely be much less if they keep their prices the same. I would expect that the cost of everything will rise and we'll have a 9% tax on top of that.

[mirjo]

Sorry to bust your "credible" magazines, but take a look at this NYTimes article from 1999:
http://www.nytimes.com/1999/09/30/business/fannie-mae-eases-credit-to-aid-mortgage-lending.html

Bush warned of Fannie & Freddie in his 2004 Inaugural Address. Does anybody remember that ?
The media was much too smart for that "dummy".

Okay, I totally get the point that you're saying the Democrats are not blameless here and that's fine, whoever is to blame should own it. What happens a lot in the Republican message is the stuff that speaks ill of the Dems is what's pointed out and the rest of the story is ignored, more often than not, the ills of this country have been/are caused by both parties. Yes, according to the times article, Clinton wanted to get more  people into homes. If you read the story it says a little more than that the Clinton Admin was at fault for getting the ball rolling:

"Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits. In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers." 

If I'm reading this correctly, it appears as though Fannie Mae had "phenomenal" profits and the stock holders wanted to keep it coming AND there was pressure from other institutions including banks "helping" FM make subprime loans. I'm just spit-balling here, but it probably wasn't the likes of a Peoples Trust Company or Union Bank.

I also questioned the Inaugural speech warning about this impending disaster (seemed out of place for the standard inauguration day warm fuzzies). I searched both GWB speeches and didn't find a mention of banks or economy or such anywhere, but I did find this in Bush's 2005 Inauguration speech (elected fall 04):

"In America's ideal of freedom, citizens find the dignity and security of economic independence, instead of laboring on the edge of subsistence. This is the broader definition of liberty that motivated the Homestead Act, the Social Security Act, and the G.I. Bill of Rights. And now we will extend this vision by reforming great institutions to serve the needs of our time. To give every American a stake in the promise and future of our country, we will bring the highest standards to our schools, and build an ownership society. We will widen the ownership of homes and businesses, retirement savings and health insurance - preparing our people for the challenges of life in a free society. By making every citizen an agent of his or her own destiny, we will give our fellow Americans greater freedom from want and fear, and make our society more prosperous and just and equal."

Again, unless I am miss-reading or miss-understanding the implied meaning, it would appear that President Bush was talking about getting people into home ownership also. The last line clearly makes a statement about things being a little more equal. As said, these are feel good speeches. It's unknown what he was specifically referring to or if he meant any of it. Campaigns and Inaugurations are grey areas to say whatever one wants to appeal to the masses. It's after that, when the rubber hits the road, when it get's more difficult to keep those promises.  Regardless of what Bush's intentions may have been on Day 1A & Day 1B they didn't come through. We landed chest deep in a recession by the end of his term, despite tax cuts in the early 2000s, No child Left Behind, (a revision/addition to the existing DOE reforms) hasn't gone as well as hoped for various reasons. Same for Clinton, same for Obama, same for G.H.W. Bush before them all.

Even he had an ill fated campaign message about taxes (Read my lips: NO NEW TAXES) Yes, I know it was the democratic congress that forced the issue--to help balance the budget...Is anyone else seeing a repeat pattern here? He had veto power, they all do. Stuff coming from congress is always wrapped in so many layers of other stuff, it makes using a presidential veto a problem. It's a great game they all play.

Chris, maybe you got the speeches mixed up and it was a campaign speech or state of the union address that Bush commented on the Fannie Mae issue several years before anything happened? I'm interested, because I'm sure if you said you saw it, you did and this is just a typo--then again, I may have missed it in the text and mea culpa!

As for the YouTube video, the beginning states it's excerpts from a hearing and it is clearly edited. How then is it possible to know the accuracy of the information once someone has tampered with it? The only way to honestly prove your point is with the actual CSPAN coverage, then people can see it for themselves and decide what's happening. As we have proven here, repeatedly, there are two sides to every story and the truth is frequently a slippery slope.

So, what's being said is Bush knew things were bad with FM and couldn't/didn't do anything to circumvent the problem? I have to say I don't understand, perhaps it's ignorance on how the government works, but how is it ok to  say "I knew that was going to happen" and not have done anything about it? Isn't that Obama's problem? He's too wimpy & doesn't stand up to bullies in congress? Soo..they all just play politics at the expense of the American public? That's pretty much what it seems to be about. The Dems blame the Reps & vice versa/ congress blames the white house/ the white house blames congress. A bunch of "experts" chime in with myriad differing opinions about what is "needed" all while the country continues on an out of control trajectory and the American people are collective collateral damage. Every few years another crop of  out-of-touch campaigners hit the trail to smile at the cameras and force feed the same tired old rhetoric.

Washington is like the longest running bad Broadway show ever, the characters are the same, but the actors are different and the cast just keeps getting worse each year.

Current campaign rhetoric (from a Rep candidate): "In 2008 the country elected a candidate they could believe in, now they need a candidate who believes in them" (?) All the same bunk that's been said before and has never changed a thing. Appealing to the christian core of the country and preaching about politics/god in the same speech is disconcerting. It seems to me, the god I grew up with wasn't as discriminating as the god these candidates profess to live so closely to.

If any political candidate (in any party) is going to claim to be "for the people" there should be a clear across the board understanding that the American "people" are more than just white middle class married protestants.