Somebody Call 9-9-9! It's Gimmick-Time For Rick Perry

Rick Pery describes his tax reform charade in today's WSJ.  I think this plan is as brain-dead as his candidacy, but let me pull this out for a special eye-roll:

America must also once and for all face up to entitlement reform. To preserve benefits for current and near-term Social Security beneficiaries, my plan permanently stops politicians from raiding the program's trust fund. Congressional IOUs are no substitute for workers' Social Security payments. We should use the federal Highway Trust Fund as a model for protecting the integrity of a pay-as-you-go system.

Huh?  As best I can tell, the Highway Trust funds (my personal fave is the 'Leaking Underground Storage Tank Trust Fund', aka the LUST Trust Fund, and don't leave home without it) are not segragated funds invested separately in non-US Treasury accounts; they seem to be special securities created by the Treasury, which makes them very similar to the Social Security Trust Fund investments.

As to "raiding" the Highway Trust funds, well, the highway funds collect gasoline and other dedicated taxes.  If Congress authorizes a lesser amount of spending on related highway projects, then the excess, although notionally credited to the Highway Trust funds, will be available for raiding in the same way that excess Social Security receipts were.

And on that question of Social Security, Perry is locking the barn door a bit too late - Social Security won't be running notable operating surpluses any time soon, so Congress will be allocating money from general revenue to fund it, not raiding it.  This is from the 2011 Trustees report summary:

Social Security expenditures exceeded the program’s non-interest income in 2010 for the first time since 1983. The $49 billion deficit last year (excluding interest income) and $46 billion projected deficit in 2011 are in large part due to the weakened economy and to downward income adjustments that correct for excess payroll tax revenue credited to the trust funds in earlier years. This deficit is expected to shrink to about $20 billion for years 2012-2014 as the economy strengthens. After 2014, cash deficits are expected to grow rapidly as the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers. Through 2022, the annual cash deficits will be made up by redeeming trust fund assets from the General Fund of the Treasury. Because these redemptions will be less than interest earnings, trust fund balances will continue to grow. After 2022, trust fund assets will be redeemed in amounts that exceed interest earnings until trust fund reserves are exhausted in 2036, one year earlier than was projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2085.

Watching Perry explain this might be fun though, since he has not shown much of a grasp of detail.

Comments

[Clarice]

Showing grasp of detail, Here's Cain slicing up fast talking Bill Clinton in an old video:
http://www.youtube.com/watch?v=ptrTa8C_Pl4&feature=player_embedded

[centralcal]

Gosh, TM - Club for Growth loves Perry's plan per NRO. I see Newt has jumped on board the bandwagon too, and is offering up his version of tax reform.

So many plans. So much math.

[Jim Miller]

Politicians, mostly Democrats, have been raiding the Highway Trust Fund for mass transit boondoggles, for years and years.

If I recall correctly, they get about 20 percent of the total every year.

[Threadkiller]

I wish Cain had Perry's experience.

[Rick Ballard]

"I think this plan is as brain-dead as his candidacy"

Shall we mark you down for the T1000 toywagon (bandwagons don't do well wrt the focus groups from which the T1000 paucity of principle platform is derived)? Personally, I need to know a bit more about the computer language running the T1000 processor prior to full endorsement. An explanation of the type of backup battery selected would be helpful as well.

[Captain Hate]

I saw that vid on the dead thread, Clarice. The smartest boy from Hope Arkansas was just up there winging numbers and not expecting anybody to call him out on it. Real world experience trumps Slick's patented BS.

[Threadkiller]

Speaking of dead threads. I do not ask for any appreciation around here, I really don't. I think it is time I pointed out something that gets looked over too many times.

Every time people here are desperate for a new thread, I manage to post something that makes that happen.

:-)

[centralcal]

And, that is why we really love you Threadkiller - because you actually live up to the promise of your screen name.

[jimmyk]

Leaving aside the SS shenanigans, I'm not sure what's so brain-dead about the tax plan. Right now we have the privilege of paying the maximum of the current farce of a tax system or a roughly 28% flat rate (the AMT). What's wrong with giving people the option of the 20% flat rate?

As for the 18% limit on spending, I think that's a laudable goal, and he doesn't seem to make the mistake of pretending that he can impose that.

[narciso]

People were just smarter 16 years ago, between
Cain, 'Harry and Louise', and Betsy Mcaughey's
analysis, they were able to beat back the
Hillarycare juggernaut,

[Ignatz]

--I'm not sure what's so brain-dead about the tax plan.--

No kidding.
Want a dead brain? Try reading any random one percent of the current code.

[Gmax]

I actually find this a discussion of a topic that Democrats once upon a time were able to demagogue until the Demogoguer in Cheif came along and messed that up. Tell me what part about this is offensive:

Central to my plan is giving every American the option of throwing out the three million words of the current tax code, and the costs of complying with that code, in order to pay a 20 percent flat tax on their income.”

Under Perry’s plan, the mortgage interest and charitable deductions would remain, along with deductions for state and local taxes, as would a $12,500 exemption for individuals and dependents, for those making less than $500,000. The death tax would be axed, as would taxes on capital gains, dividends, and Social Security benefits. The corporate income tax rate would be slashed to 20 percent.

[Jack is Back!]

Its an opt-in flat tax not mandatory. It protects some CPA jobs, keeps H&R Block lobbyists at the DMZ of going nuclear in the Cannon Building and gets Perry back in the conversation. What is going to kill Cain is not Cain but whoever is advising him. Have you see the Mark Block(head) video ad where he ends up lighting up a cig at the end and Herman gives a sardonic smile? I may get Janet's vote but even the Daily Telegraph is all giggles over it.

[Melinda Romanoff]

Gold up $50 right now.

I wonder what has everyone worried?

[Melinda Romanoff]

Oooh, Greek bank runs have started.

[Jane]

I liked it because it was so odd.

[Melinda Romanoff]

Jane-

Did you catch that Elizabeth Warren vid yet?

[Danube of Thought]

My vote for the all-time dead thread goes to the excruciating discussion of student loan repayments.

[Janet]

Hey! I'm not the sharpest political analyst here, but I base my voting on more than a candidate's tobacco use....not much more, but a little. :)

[Jane]

Which one Mel? The one where she says she started OWS?

[Old Lurker]

But you had one of your best posts there DoT when you asked how/why that was your problem at all!

[mikey]

It is interesting that those who like Perry's plan question his ability to sell it to the public. I think many Republicans question Perry's ability.

However this in contrast to Obama, who couldnt sell the public his Health Care Plan or even his jobs bill but many in the press and his base have no reservations about his selling skills.

[DebinNC]

Re student loan repayment, Ras today:
"The latest Rasmussen Reports national telephone survey finds that just 21% of American Adults think the federal government should forgive the nearly $1 trillion in loans it made or guaranteed to help students pay for a college education. Sixty-six percent (66%) oppose the forgiveness of all student loans.Thirteen percent (13%) are undecided."

[Melinda Romanoff]

Rick-

Another interesting little report, when you get bored.

[Clarice]

That's good news, deb, because I did need the "Insider" to tell me the Dems were licking their chops hoping to buy up the youth vote with a student loan amnesty

[DebinNC]

Daley:"All I'm trying to do is get through day to day. I have no plans."

Daley is simply hoping to get out alive. So much for the myth of the formidable Team Obama.

[Ignatz]

--My vote for the all-time dead thread goes to the excruciating discussion of student loan repayments.--

My head still hurts.

[LouP]

Re: Perry. I'm from Texas, and am only luke-warm on Perry. When he started making noises like he was going to run, I shuddered.

But when you get down to the bottom line, his problem fundamentaly comes to three things:

1) He's from the heartland, and not from the Northeast.

2) He's from Texas, and Texans are reviled by people from the Northeast.

3) He didn't go to an Ivy League school, so he's not Northeasterly cool and slick.

Oh, wait. That really boils down to only one strike.

And you say: what about Herman Cain. Same thing, but he's at least got a race thing going for him, and he's not a Texan.

[MayBee]

Sorry for hurting all your noggins yesterday.

[centralcal]

State Department Buys $70,000 worth of Bill Ayers Obama books for embassies in Egypt, Indonesia, South Korea. More tax dollars wasted.

[Ignatz]

--Sorry for hurting all your noggins yesterday.--

You were an analgesic, MayBee. The pain came from elsewhere.

[Clarice]

I just posted that on the other thread..Get outta my head, cc....(XOXOXO)

[centralcal]

lol, Clarice. Finding it difficult to stay abreast of multiple threads while at work (obviously a really slow day at work, but there is an occasional phone call).

[centralcal]

Sheesh, it is only 3:04 PM California time and Obama is already done in San Fran and headed to Denver per Mark Knoller. 200 idiots paid $5,000 a pop to listen to his canned speech and he's off.

[Clarice]

Well, here it goes:

WASHINGTON (AP) — The White House says President Barack Obama plans to offer millions of student loan borrowers the ability to lower their payments and consolidate their loans.
Obama on Wednesday will use his executive authority to accelerate a measure passed by Congress that reduces the repayment cap on student loans from 15 percent of discretionary income to 10 percent. The White House wants it to go into effect in 2012, instead of 2014. About 1.6 million borrowers could be affected.
Also, the 5.8 million borrowers who have loans from both the Family Education Loan Program and a direct loan from the government would be able to consolidate them into one loan. The consolidated loan would be up to a half percentage point less.

[Threadkiller]

200 idiots x $5000 = how many rapes?

[Ignatz]

--200 idiots x $5000 = how many rapes?--

You must be talking Flint, MI, TK.
I don't think they have rapes in SanFran do they, unless you count, per Andrea Dworkin or whoever that ugly cow was who couldn't get laid and said consensual sex between married heterosexual couples is.
There are some of those left in the city limits I presume.

[Uncle BigBad]

Well, now we know who TM doesn't support.

[Chesty LaRue]

Are you retarded? Congress doesn't raid the highway trust fund for non-highway projects like it raids Social Security surpluses to pay for other crap. How is this hard to understand?

[Chesty LaRue]

"Watching Perry explain this might be fun though, since he has not shown much of a grasp of detail."

Perry's Social Security reform proposal restores actuarial balance and creates future OASDI tax surpluses. So that's why you still have to protect the trust fund tomorrow even if it's running operational deficits today.

It must take a real genius of superhuman intellect to somehow think that position is JUST CRAZY.

[RichatUF]

How about this thread until we get a new one?