Four words I never thought I would write: Michele Bachmann is right. There is something devilish about Herman Cain’s 9-9-9 plan.
Cain’s plan, among other difficulties, fails the test the U.S. bishops have set for all public policies relating to the federal budget and government spending: It fails to protect the poor. As an analysis in this morning’s Washington Post shows, the 9-9-9 plan would raise tax rates on the poor and middle class and provide huge windfalls to the rich and super-rich. It makes no economic sense but that does not mean it fails to make political sense.
Cain’s plan, precisely because it is simple, plays into the genuine, and understandable, frustration many people have with the complexity of the current tax code. Your average voter may not grasp just how Byzantine our current tax code is, but they know something is awry when Warren Buffet pays a lower percentage of his income in taxes than his secretary does. Politicians on both the left and the right denounce the complexities of the tax code and argue that we need to simplify it, which is all to the good. But, they are unable to come to any agreement about how to achieve the goal of reducing rates, closing loopholes, and simplifying the entire code.
The problems with the tax code are many, and these problems are not only the fault of the GOP and their pro-business allies. Democrats, too, have used the tax code as a vehicle for achieving certain political objectives. Take the Earned Income Tax Credit (EITC), which was begun in 1975, and expanded subsequently in the 1980s and 1990s under administrations of both parties. This tax credit allows the working poor to actually receive more money back than they pay in. Another, slightly better off percentage of Americans do not qualify for the EITC, but they do not make enough money to owe any federal income tax. The EITC is enormously complicated as I learned when I tried to help some Bosnian refugees with their taxes in the mid-1990s: I was trying to help them with their tax forms, and I knew they were eligible for the EITC, but I could not figure it out and ended up bringing their tax returns to an accountant.
The EITC keeps millions of Americans from falling below the poverty line which, at 22k, is unimaginably low. But, it is counter-intuitive. One of the GOP mantras is that there is something wrong when 47% of Americans do not pay any federal income tax. This is true: There is something wrong. There is something anti-democratic in the idea that some people do not pay any taxes. But, the solution is not to make the poor pay more. The solution is to raise incomes and devise an economy that spreads, rather than concentrates, wealth. Politically, of course, trying to raise the minimum wage when unemployment is at 9 percent is a non-starter. And no adjustment to taxes on wages will address the deeper socio-economic problem of the high degree of wealth concentration in America today.
In recent days, Mr. Cain has introduced a new talking point to respond to the charge that his plan would hurt the poor. He says that his new national sales tax would not apply to used goods and that the poor could save money by purchasing used goods. There is something Dickensian in this suggestion and when I first heard him utter the idea I thought of the parable of scraps falling from the master’s table to the dogs. (Of course, my dogs love scraps from their master’s table, but I suspect pets were not treated in Jesus’ day as they are in our own.) The last thing America needs is a new way to divide the rich from the poor. The poor may not be able to shop at Neiman-Marcus under any economic scenario, but they shouldn’t be consigned to exclusively shopping at Goodwill either.
Cain’s proposal will not long survive. There is something fishy about his unwillingness to name more than one of the claimed “economic experts” who devised it and the one expert he did name, Mr. Richard Lowrie, seems to have a fairly limited degree of expertise. That, however, like the plan’s simplicity, is not necessarily a bad thing politically. President Obama might not have devised different policies if he had consulted not only economists with Wall Street experience but some small business accountants too, but he might be better able to explain his policies if he relied on more than expertise in framing them. Nonetheless, the 9-9-9 plan will disappear with Cain’s candidacy which surely will not survive the increased scrutiny his rise in the polls will occasion. The horrible new CNN anchor, Erin Burnett, may have been unwilling or unable to press Cain to move beyond his sloganeering, but the time is coming, and it will not be long in coming, when Cain will get a question or a series of questions on which all his charm will not be enough to cover-up his more than usual level of ignorance. Ronald Reagan, like Cain, was enormously charming and somewhat allergic to policy details, but he had years of executive experience in government and had surrounded himself with a coterie of policy experts who knew his mind and could help him to grasp the core issues amidst the complexities of policy-making. Trying to build up such a team under the glare of the spotlight during a campaign is not possible, simply not possible.
The irony in all this is that Cain has achieved something Obama can’t. His 9-9-9 plan has people talking about how policy affects the poor. And, that is a good thing. Now, it is time to start cutting through the myths of American life about endless opportunity and self-made men and being all that you can be and all that nonsense. It is time to look at the deeper problems in our economic life, the way labor is treated as a commodity, the lack of a living wage, the growing wealth gap, and other issues that are central concerns of Catholic Social Teaching. I seem to recall that when President Obama visited Pope Benedict XVI in 2009, the Holy Father gave him a copy of Caritas in Veritate. Might someone in the press corps ask the President: Have you read it? And, might that not be a good question for the next GOP presidential forum?