TAXES - FAIR TAX vs. FLAT TAX ? AN OPEN LETTER TO HERMAN CAIN

Dear Mr. Cain
 

I have a MAHRvelous proposal!!!! (Sorry for the pun)

There is great concern across the country about what must be done to bring our nation back onto a sustainable financial path. The answer is simple, though painful. Entitlements have to go away. Period!!!! There cannot be any sacred cows!!! The problem is everyone will scream – “Take his money” – “not mine”!!! The other problem is - who is going to be the “Bad Guy” that makes the cuts? The Republicans are itching to get their power back. OK. But will they actually be content to be the “Bad Guy”? I wonder. Cutting school lunches, eliminating free cheese, dismantling social security, really ending pork project spending, and so on.  Regaining power in 2012 and attempting to set the financial ship aright can only play into the Progressives hand. They will be waiting in 2016 to be swept back into office on a carpet of riotous dissent from the poor and disaffected from the previous 4 years.

There is an answer though –

If you are going to take away something from someone, you have to give something in return or
exchange that is as important to them as what they are losing.

A FLAT TAX – not a value tax – not a sales tax – not any variable tax of any kind. A FLAT TAX

So many times we hear the proponents of a national sales tax spout about how it incents people to save because we aren't taxed on what we save but only on what we spend. WELL !!!!!! That's great for the period of time that I am saving. But after putting away a little each paycheck something will come up that I can now finally afford. A new TV, new car, add a garage to the house - etc. - Well!! There goes the benefit of the “Fair” tax - right out the window. We get hit as soon as we finally spend what we have saved for so long - So what is the difference??? The only way to avoid it is to DIE with a lot of money in the bank. Doesn't seem too appealing to me!! You still get taxed on everything you earn because eventually you will want to spend it

NO BENEFIT THERE!!!!!!!!!

The other down and dirty issue is that a “Fair Tax” would only promote a whole massive Black-market of traders, swappers, and barterers, all trying to get around an onerous (20% or more) tax. It would be a nightmare. Right now we have a whole host of people using deductions and tax exclusions and numerous loopholes to circumvent the tax code. Using a “Fair” tax would only shift the same people’s efforts. (See Steve Forbes for specifics!!!!). Ever know anybody that has paid cash for a product or service to get out of paying a 7 or 8% sales tax???? I'll bet you have!! The buyers gets away without paying the extra money in tax and the seller omits having to hold, document, and pay out the tax money collected. What do you think it will be like when a tax jumps to 23%?????

Flat Tax proponents have bandied about numerous rates (15%, 17%, 20% and so forth). But those rates are all based on the present bloated federal spending.

If we can strip out all those things the federal government shouldn’t even be involved in, we could pare that number down to 10%. Yep – 10% for EVERYONE. PERIOD. NO EXCEPTIONS.

Withholding will still take place. That infrastructure can stay in place. There will be no tax deductions of any kind. For anyone. PERIOD. No Filing, No refunds, No tax incentives, no tax penalties. Nothing.

10% is 10%

A person who makes 50,000 a year will pay 5,000 in taxes.

A person who makes 5 Million will pay 500,000 in taxes. Yep – the rich will pay more automatically!!

Yep – that means someone that makes 10 times as much money as you will pay ten times as much tax as you.

Wow – what a concept!!!

That is really the only fair way to tax the population and take away the power that taxing gives to politicians.

The IRS – all of it – goes away. (As will H&R Block and every other Tax Service)

Let’s put that monumental talent pool (insert sarcastic smirk here) back into the private sector.

People constantly say that Medicare is the largest entitlement or Social Security or Medicaid. – Well. They are wrong. The largest entitlement group (by volume) is the 47% of the population that pays NO TAXES!!

The only reason the politicians want the rich taxed so heavily is because the lower classes don’t even pay taxes – so who cares if they are working or not. The Progressives could care less if the people are working or not (they can’t get anything from them [since they don’t pay taxes] – except votes) as long as they can keep over-taxing rich people and evil corporations. Power is supreme. So, as long as the Progressives can keep more than ½ of the country not paying any taxes, they can expect to keep receiving over ½ of the votes to keep them in power.

The largest entitlement group is the group that is entitled to pay NO TAXES. That has to stop.

And by the way – this proposal is NOT a “Tax everyone 10% proposal” Nope!!!!!

This is a “KEEP 90% of everything you earn” proposal. That is how it needs to be sold!!

10% of every dollar earned in the country is more than enough to sustain the needs of the federal government.

Offering such a simplified tax code – at such a low rate – and eliminating the IRS and ending the yearly mess and consternation over tax returns forever might just be enough to allow us to swallow the bad medicine in order to make us healthier.

If you want cheese go to your city or county or state. If you want school lunches go to your city or county or state. If you want ANYTHING, don’t look to the federal government to provide it. Go to your local organizations, churches and communities for whatever you want.

10% is enough for the federal government. (Ray Stevens said it best musically when he crooned “If ten percent is good enough for Jesus it ought to be enough for Uncle Sam”)

Eliminate EVERY federal tax on any and every product. Fuel, cigarettes, utilities, etc. All go away.

If you allow everyone to take home substantially more money from their paychecks and (at the same time) make products that were federally taxed cheaper to buy plus eliminate the onerous IRS all at the same time, you just might be able to get the people in this country to go along with the huge cuts to their entitlements that must be made.

Millions would be affected by entitlement cuts – but hundreds of millions would be blessed with lower taxes and cheaper prices.

Given the success of the Obama campaign for the Presidency – (The complete ruse foisted upon the American voter with the Hope and Change message) – this solution can be sold to the public just as easily.

Everyone seems to believe the thought that in order to cut spending some part of the American public has to lose. Either this part of the public or that part of the public and so on. NOT TRUE!

The issue of who has to bear the brunt of spending cuts always compares different parts of society and their need for federal assistance. Which group needs their money more? (Seniors, Medicare recipients, school lunch programs, education assistance users, etc)

The one group that never makes that list is the Government itself.

When you take away social security benefits or Medicare benefits or school lunches and so on – but in return – give back to each person lower withholding, cheaper gas, cheaper utilities, cheaper cigarettes, etc – then the only person that really loses is the government. It has gotten smaller!!!!!!!!!!!!!!!

The government is more than willing to pit us against each other in the argument about spending cuts when in reality the solution is as simple as giving them (the government) less and us (taxpayers) keeping more.

If redistribution of wealth is really Obama’s creed (so to speak) then the answer is as simple as taking from the richest entity in the country (THE GOVERNMENT) and not giving it back to but rather leaving it in the hands of the poor (US).

One further item needs to be addressed - Earmarks, Pork projects and other financial appropriations.

There is ONLY ONE WAY to put an end to this travesty.

Once the above tax rate of 10% is made law – we must also add the provision that once income tax monies have been forwarded to the Federal Government – NO FUNDS ARE TO BE RETURNED TO THE STATES. Period!! Ever!!!!!

The monies we pay to the Federal Government are to be used for Federal (National) issues.

This would eliminate Senators and Representatives vying for pork projects. There would be no further reason to lobby them and nothing for them to trade and bargain with each other for. Everything they would be voting
on would only have a Federal purpose. (Defense, Trade, Federal Salaries, Security, International relations, etc.).

(It may also greatly improve the nobility of the candidates that would now choose to run for office. If today’s politicians can no longer bleed the tax payers or lobbyists, the greedy opportunists we have now would
have to take their glib and polished demeanors to the private sector and ply their trade there.)

Want to bet that not even half of them would ever make it past middle management??????????????

If (by any chance) the Federal Government runs at a surplus (insert loud guffaws here), then those tax dollars stay in the hands of the Federal Government to be used when emergencies do happen. (Disaster aid, Wars, and the like)

No longer would tax payers in Maine fund river projects in Texas, or tax payers in Ohio fund research at Universities in California. And so on and so on and so on!!!!!

Useless and unnecessary departments need to go. Dept. of Education – GONE, Dept. of Agriculture – BYE BYE., Dept of Health and Human Services – SEE YA – and so on and so on.

The Cabinet??? – My guess is we can get along just fine with a Sec. of State (for foreign affairs), Sec of the Interior (for internal affairs), and a Sec of Defense (for Military issues). Everybody else – SO LONG!

As to the argument that such drastic measures are insane and would shove millions of government workers out into the street; there is an answer as well. When these depts. are cut, offer every single government employee a full 1 or 2 year phase out period. In other words. They will keep their jobs for two years as their dept is shut down. This gives the states time to beef up their own departments to cover issues the Fed used to and gives the ousted employees plenty of time to find a new private sector position. (Many would probably find their comparable positions in state and county governments.) Any employee will have the option of leaving at any time and will be offered 50% of their remaining salary as a severance. If the phase out is two years, an employee can opt leave immediately and get a full year of severance pay. Or they can stay a year while they look for other work and then leave and get 6 months of their remaining pay.

This is fair – humane – and NECESSARY!!!!!!!!!!!!!!!!!!!!

And now for the clincher - - - Get ready - - Here it is - -

The 10% Flat tax imposed by the federal government CANNOT BE RAISED BY CONGRESS EVER AGAIN.

If the government decides the 10% rate needs to be increased – the only way it can be increased is - it must be put onto the next national presidential election ballot and only the “People of the United States” can vote to increase the amount.

I am sending this to you because I have heard countless arguments regarding whose benefits have to be cut (pitting us against ourselves [young against the old, rich against the poor, etc]) and NEVER once has anyone suggested that the government has to be the one that takes the loss. This solution would work, and I bet (as I referenced earlier) that Steve Forbes could elucidate it far better than what I have done here.

My guess is that I can’t be the only one that has thought of this but if you have any questions or thoughts, I would be happy to respond.

I would forward this to others in the media (Glenn Beck, Bill O’Reilly, Mike Huckabee, etc) but my guess is they will never even get to read it. Or even if they do – it would be too sweeping of an endeavor to even consider. My hope is you, with your business acumen, and those you speak to everyday might see some merit in this proposal.

We would only need ONE Senior politician or candidate to have the guts to champion this sweeping type of solution and the TEA Party throngs would take up the chant.

As a businessman, you have the hardest job in securing a party nomination. My guess is that professional politicians have no interest in seeing someone outside of their circle usurp them in an election.

It is my feeling that the ESTABLISHMENT (media, govt, etc) has absolutely NO INTEREST in giving any credence to a non-political candidate. If a businessman can win the highest office and actually do well, there is no reason to continue to think that Senatorships or Representative offices are breeders for the highest office. Excluding Governors - Senators and Reps. have NO SKILL SET to run anything. And Governors may well run large budgets BUT - IT'S NOT THEIR MONEY!!!!!!!!! A businessman making a million $ decision vs a Governor making a million $ decision is not the same thing!!!!!

You won the first debate in South Carolina hands down. Nonetheless, your name is almost nonexistent in media conversations since then. Since Huckabee and Trump pulled out, all the media talk is about how that might help Bachman, Daniels, Pawlenty, Santorum, or Romney – NEVER CAIN!!!!!

You have to be far more dynamic, far more original and infinitely more appealing.

Everyone else will be running against Obama – and playing to those he has alienated.

Don’t Do it – Don’t run against something – run FOR something!!!!!!!!!!!!!!!!!!!!!!

If you can put up a better and more appealing model than other Republicans and show everyone a better life than the one Obama envisions for us – YOU WIN!!!!!!!!!!!!

The “Right” wants this to be a race where a vote for a Republican is a vote against Obama – They could lose that one!!

Trying to get the general public to believe that they must vote against the first Black President in order to make things better is a HUGE mountain to climb and may well be an insurmountable one.

Someone (hopefully you) needs to make the public feel that their vote for a new candidate is not a vote against Obama, but rather, a vote for a NEW VISION, a NEW WAY, a NEW LIFE.

I know this may sound blasphemous to many BUT here it goes –

AMERICA – you made the right choice in 2008. The Federal Government was corrupt, out of kilter and running wild. You voted in 2008 for hope and change. That was the right thing to do. Your vote has brought about huge changes that have had years to develop and show success. It hasn’t. That’s a fact.

You voted for Hope and Change and you got it. But you didn’t get a NEW VISION – you didn’t get a new WAY and you certainly didn’t get a NEW LIFE. It’s time to get all three!!!! You had the right idea!! - You just picked the wrong guy!!

I know I have pontificated at length in this missive – BUT – this country needs a Herman Cain.

I hope you actually get to read this!

I am not a scholar or a politician. I am not rich. I am not particularly gifted (except for the blessings of my wife and family) and I am not better or worse that anyone on my street, block or city. But I am an American (served in the Marines) and I love my country dearly. And while I worry (and sometimes fear) for the generations that will follow me I have an unshakeable faith and pride in the United States.

If we were to take up this drastic and sweeping change to the size of government, NOW is the time to do it. We must develop a rallying cry for the conservatives (the true center) in this country. Many came out to vote this last November – MANY MORE will need to be rallied for 2012. (You can bet your house on the fact that the Democrats are already shifting voters [and establishing residencies] to what they consider “swing states” in the Electoral College in order to steal the next election as well).

This kind of change can only happen with a conservative majority in the House (DONE) – the Senate (next election) and the White House. Reclamation in 2012 – it’s coming!!!!!!!!!!!!!!

Respectfully

John Mahr (hence the term MAHRvelous)