I am definitely considered in the lower class category in the United States today. As a single mother I make almost $2.00 an hour above minimum wage and I have no bills other than my mortgage, utilities, insurance, gas, and food. Yet I barely have enough money to cover those cost of living expenses that I do have.
I am in that bracket of Americans who do not pay federal income tax. Now some people say that is ashame. However, I (and other lower income families) didn’t set up the system. My employer deducts from my paycheck exactly what the federal government tells them to (in my case none). I file my taxes every year just the same as everyone else, and they actually give me some money back, even though I paid them nothing. Some would say that is horrible. However, that money is what pays for car trouble, plumbing problems, clothes and school supplies, and other unexpected costs during the course of the year and rarely lasts the entire year. I’m not asking anybody to feel sorry for me. It is what it is and God meets all my needs as they arise. I don’t feel poor, I feel blessed.
However, the 9 – 9 – 9 plan that Herman Cain proposes scares me. As I understand his plan (and I could be wrong), everyone would have 9% federal tax taken out of their paychecks and not have to file their taxes at the end of the year. If I’m understanding this correctly, this means that I would not get any money back from the federal government and I would also be down 9% on my paycheck each payday. That means I would have to live off of approximately $135 less pay each month. I’m barely making it from paycheck to paycheck as it is. Then you take into consideration that I would have to begin paying 9% more on most anything I buy. This would be a major impact on my budget.
So for the year, considering the 9% tax on my paycheck and not getting the Earned Income Credit, I would make $7600 less each year than I do now. Couple that with the fact that the cost of living is not going down and we have a major problem. The cost of gas, food, etc keeps going up and my paycheck does not keep up with the rate of inflation. Now if they could 100% guarantee that inflation would go down and not up, then we might be o.k., but when you still have the Federal Reserve printing money out of nothing, inflation is guaranteed to keep going up. In addition to all that, what guarantee would we Americans have that the next President wouldn’t raise that percentage from 9% to something higher.
Herman Cain’s plan may seem simple and that is why it appeals to many people, but the negative impact it would have on middle and low class families is HUGE!
My thoughts are that they need to fix Washington in order to fix the economy and until they do that, all their efforts will be in vain. They need to scale back the size of the federal government like doing away with the useless Department of Education, and other departments that are not within the scope of the duties of the federal government as outlined in the Constitution. In the companies that are left, I’m positive they can find many wasteful costs and expenses that they could slash, as well as doing away with many positions within those departments. They need to get back to a money system that is backed by gold and silver and quit printing money from nothing. They need to bring businesses back from over-seas and help people be able to create more businesses here in the United States. We need to manufacture more.
I most definitely don’t have all the answers, but I do know that as long as Washington operates under Keynesian Economic prinicples, this country is in dire trouble, and all of it’s citizens will feel the impact.
Jackie,
I agree with everything you said, in regards to The Fed, inflation, and us needing to get back on a sound monetary system. While I completely sympathize with your position, and, I too, am doing far worse then I was only three years ago, should we tacitly accept a continuation of Socialism, and this God-Forsaken Federal Income Tax system, just because there may be some short-term negative factors?
This is precisely the moral-hazard in a Socialist system: So many people are so dependent on Govt, subsidies etc, that any move toward reform becomes nearly impossible. I can assure you, any efforts to abolish The Federal Income Tax, will be met with strong resistance from every lobby group, and special interest group under The Sun. But, as long as this God-Forsaken system stays the way it is, we will not likely ever move this country forward.
I desperately want The Federal Income Tax abolished, and The 16th Amendment repealed. And, that must be done before any talk of a national sales tax is implemented; otherwise, we could end up with both. That said, I really do like The Fair Tax idea, which ends ALL Federal Income Tax, Corporate Tax etc, and leaves only a national sales tax, on (new only) items purchased. That alone, would start turning us back into the production-based economy that we once were, instead of a consumption-based economy that has been created by these Technocrats in The Federal Reserve and Washington D.C.
By: Markross on October 13, 2011
at 2:43 pm
I agree with what you are saying, and I didn’t mean to imply that I should have no inconvenience coming off the government subsidy (i.e. Earned Income Credit). However, Cain’s plan is to take 9% out of my pay, plus eliminate the Earned Income Credit, plus then I would have to pay on top of the 9% income tax, a 9% federal sales tax. Like you said in your last paragraph, you would need all income tax from our paychecks eliminated before implementing a national sales tax. With Cain’s plan we will be getting hit both ways, and like Bachman said, once you implement both, it will be near impossible to reverse it.
By: JD on October 14, 2011
at 6:22 am
I agree with much of what you said. However, 999 is too extreme to fast focusing on only part of the problem. As you say, the socialism has created this extremely diverse mess. People like JD were still capable of squeezing by without Government help. Government’s intervention the last 40 years, which have been accelerating at unbelievable rates every decade, have created a terrible disparity in wages. This problem was addressed and solved by Government to create the welfare you see now, so they could continue their crony capitalistic system going. This disparity continued to grow. Now that we recognize this, we want to throw the people that are to suffer the worst, at no fault of their own, to the wolves? You cannot morally do that in good conscious. I am for everything you believe in, except not done in the 999 plan. Government needs to cut spending majorly first. They need to start getting our house in order first. Before we hit these individuals with paying there fair share. Under 999 my daughter would lose $8,000. And she has 2 young sons. These problems are not her fault. She never even benefited from any of this free flowing cash that the rich have enjoyed. Government must start by fixing what it messed up to allow these people to make a living. And again, I do not believe this is solely done on an income only plan, like the 999 plan.
I hope you understand my views on this. I’m not here to endorse a candidate, however, I’m voting for Ron Paul. I have been following him since 2007. I’m telling you this only to show how my views are on the Fed, Big Government, never ending wars, crony capitalism, central economic planning, price control, failed drug wars, and abolishing the income tax all together…….and I could even go on.
By: David on October 20, 2011
at 5:12 pm
It sounds like we are both on the same page. Fix the economy first, so that I (we) can afford to live off what I (we) make. I’m leaning toward Gary Johnson for President who is more of a libertarian like Ron Paul. In reality though, I don’t believe the Republican party (just like the Democrats) will allow a libertarian to get anywhere near the White House. It is a shame, but I believe it is true. They would all be fearful that a Libertarian would actually go in there and clean house and reduce the size of the federal government, and the Washington elite are too protective of their turf and power.
By: JD on October 21, 2011
at 7:51 am
OK, I see what you are saying now. Your point was, if we implemented this 9-9-9 plan the way Herman Cain is suggesting, it would/could do more harm then good. And, that I completely agree with.
Yes, it must be done the way I, and MANY others, have suggested: which is to first repeal The 16th Amendment, and abolish The Federal Income Tax. At which point, you, I, and every other working American would keep a lot more of their pay. That alone, would unleash so much economic freedom and energy, that the economic benefits are almost unimaginable.
By: Markross on October 18, 2011
at 3:46 pm
Jackie, I’m not a total fan of the plan either, even though I would likely pay much less. Besides the personal impact for you, and I do understand your anxiety, it also gives the government another potential funding stream.
By: Matt on October 23, 2011
at 7:06 pm
Yes, it would give them another funding stream, and I feel certain that they would increase it later. The fair tax would still have a major impact on me and my situation, but it is one that I could learn to live with and adjust to.
By: JD on October 24, 2011
at 7:01 am