9-9-100? Prof Pushes 100% Consumption Tax on Rich
If Herman Cain has been harshly criticized for his 9-9-9 plan, which includes a 9% national sales tax, should we expect Robert Frank to come under fire? After all, on Morning Joe today, the Cornell University professor proposed a progressive consumption tax that could go to . . . 100% on the rich.
Frank's notion is that the very high rates would discourage the rich from building "mansions" [a term he used multiple times during his appearance]. And the taxes thus collected could go for things he thinks we need. For example, Frank incredibly claimed that in the US, "we don't invest in education," ignoring that we spend more per pupil than any country in the world other than Switzerland. Video after the jump.
Watch Frank espouse a form of 9-9-9 on class-warfare steroids. You'll note that when Joe Scarborough first aks him to state the tax rate he has in mind, Frank speaks in generalities. Eventually, Steve Rattner pins him down, and Frank confesses that he favors a 100% rate for consumption over $4 million.
JOE SCARBOROUGH: What kind of tax rate are you talking about? Let's say Steve Rattner decides to build another ring onto his mansion.
ROBERT FRANK: You worry about high marginal tax rates when we're taxing income because that does discourage savings. Savings is a part of your income. So we don't want to discourage that. If we're taxing consumption, it's a whole different story. So if I were a savvy rich guy, and I'd read the relevant studies, I'd want to move to a place that had a very steep progressive rate on consumption because I'd say to myself: that's a place, if I go there, I can build my fortune. If something bad happens I'll have more stashed away to take care of it. And in the meantime I won't be blowing all my money on coming-of-age parties for my kids.
STEVE RATTNER: Just so I know what to prepare for, what rate? What's the rate?
FRANK: It could be 100% on the next dollar, if you're already consuming $4 million a year. That would mean if you spent an extra dollar, you've got to come up with an extra dollar for the tax authority.
Full Disclosure: Bob Frank was a tennis buddy back in my Ithaca days. Hopefully I won't be on the other side of the net anytime soon when he gets a short, sitting lob ;-)
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Comments
Hey, Professor
Submitted by Tugboat Phil on Mon, 10/24/2011 - 10:25am.
How about making all your published works available for free and refunding any purchase price already earned? How about teaching for free since it's such a noble and necessary profession?
This guy lives in Bizarro
Submitted by motherbelt on Mon, 10/24/2011 - 10:45am.
This guy lives in Bizarro World.
These socialist are such idiots
Submitted by c5then on Mon, 10/24/2011 - 11:21am.
Beyond the fact that a progressive consumption tax is unenforceable and totally unworkable, all you do is send the consumption elsewhere and/or curtail it.
So not only wont it stop the "evil" rich from buying stuff, it will not generate anywhere near the tax revenue that they predict.
And at the same time...In the same sentence they admit that the plan is to discourage the opulent spending and then estimate the income as if the behavior is not discouraged at all.
And this guy is an author of a book supposedly about an economy??!!! I hope it is classified as fiction.
Madison and Jefferson and Franklin built a Republic - Roberts killed it!
And therein proves Bachmann's criticism of 9-9-9
Submitted by Blonde on Mon, 10/24/2011 - 12:10pm.
That greedy democrats and RINO politicians will see the Consumption Tax portion of Cain's plan as "free money".
What is it about liberals that they loathe the wealthy so much?
Handy Reference Guide to Obama's Gaffes and Goofs ~ Currently Numbering 200 (and Counting)
Blonde,
Submitted by Agnostic on Mon, 10/24/2011 - 12:46pm.
It is not loathing but envy. Remember the liberals still like Manhattan, Martha's Vineyard and other notable liberal 'get-a-ways'.
How about this?
Submitted by CobraMan on Mon, 10/24/2011 - 12:30pm.
How about we augment those taxes by adding another one for tenured employees? What say ye, Professor? Ready to pay your fair share?
The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States. The US Constitution
Unless you're a fetus. The US Supreme Court
Or Anwar al-Awlaki.
This guy is a Professor?
Submitted by CobraMan on Mon, 10/24/2011 - 12:37pm.
So, the "professor's" plan is to tax the very thing which drives our economy, consumption? The more you buy, the greater your tax burden? The more you contribute to the economy, the more you'll be punished? Yea, like that'll help.
The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States. The US Constitution
Unless you're a fetus. The US Supreme Court
Or Anwar al-Awlaki.
This is strange...
Submitted by Kaleidoscopic God on Mon, 10/24/2011 - 2:54pm.
For some reason, I never see professors this crazy or stupid in the engineering department at my school.
I've said this before and I'll say it again.
Submitted by IdahoJim on Mon, 10/24/2011 - 3:21pm.
The rich do not build mansions.
Carpenters, plumbers, sheetrock hangers, stone masons, concrete workers, and a whole host of other trades and professions build mansions. The rich pay for it, putting their money into jobs, goods and services. Don't forget the monies paid for insurance, maintenance, taxes on improved property that are ongoing expenses for the rest of the life of the building. The rich are paying for these things too.
A 100% consumption tax to stop the rich from building mansions would throw countless thousands of workers out of work.
Just like the old 'Luxury Tax" on yachts and other goods considered non-essential destroyed the US yacht building industry. The rich just went overseas to buy yachts and flagged them in foreign countries to escape the tax. Again, hundreds if not thousands of jobs were lost or sent overseas.
There are two more industries that this administration has nearly destroyed; Vegas and private jets. Did it ever occur to Obama that the private jet business has many thousands workers and buys good and services from many others? What about the hotel workers? A company blows into town for a conference and spends a boat load of money in the local economy. What's wrong with that?
I got to get back to work. Let's hope we elect a President that understands the term "Money Never Sleeps",
Oh yeah, money also talks. It tells me "Goodbye" every day.
IdahoJim
http://idahoandy.net
Of course the good professor would ignore that.
Submitted by drsamherman on Mon, 10/24/2011 - 6:48pm.
It is real people who are affected when some ivory tower type with zero idea of working in the real world comes up with these preposterous ideas. The usual suspects then suddenly turn tail and scream their theories were misunderstood, misapplied or misspoken.
Amazing
Submitted by GregE on Mon, 10/24/2011 - 8:10pm.
That ideas like this are discussed as serious, and that those espousing them are not embarrassed for themselves.
This just supports my belief
Submitted by Smartypants on Tue, 10/25/2011 - 10:28am.
This just supports my belief that liberals live in a land of make believe. Most of what they think is true is 180 degrees from reality.