The Corner

Simply Misunderstood

Over at Bloomberg View, I have a follow-up to my column earlier this week on Herman Cain’s tax plan. It’s remarkable how many of the fans of that plan don’t understand its most basic features–and one sometimes suspects that Cain is one of the people who don’t understand them. Critics of my column took issue with me, for example, for saying that what Cain calls a “corporate income tax” is actually a VAT, with some of the critics calling me a liar. I plead not guilty:

Today’s U.S. corporate-income tax lets companies deduct wages as a cost of doing business, and that’s what a tax on “net business profits” would do too. Cain’s business tax includes no such deduction, but it does let companies deduct the cost of purchases from other businesses. That’s what a value-added tax does. Perhaps that’s why the scoring report commissioned by the Cain campaign, and available on the campaign website, refers to the tax as a “subtraction method value added tax.”

There are reasonable arguments for a VAT, although I don’t happen to find them persuasive. But a candidate proposing one should call it what it is.

I go to defend, among other things, my statement that the Cain plan has to involve either increased consumer prices or decreased wages.

Ramesh Ponnuru — Ramesh Ponnuru is a senior editor for National Review, a columnist for Bloomberg Opinion, a visiting fellow at the American Enterprise Institute, and a senior fellow at the National Review Institute.

Most Popular

PC Culture

America Is Intolerably Intolerant

When you think of the sheer vindictiveness of what happened to Oklahoma quarterback Kyler Murray, it takes your breath away. On the very night of his greatest career triumph, a reporter dug up his old tweets (composed when he was a young teenager), reported on the most offensive insults, and immediately and ... Read More
Politics & Policy

How Democrats Can Blow It in 2020

Donald Trump probably can’t win the 2020 presidential election, but the Democrats can lose it. What I mean is that in a contest between Trump and a generic Democrat, Trump would almost surely lose if the current political climate holds through 2020. According to a Fox News poll this week, 38 percent of ... Read More
Film & TV

Clint Eastwood’s Unforgettable Curtain Call

At 88, Clint Eastwood seldom appears on screen anymore and last acted in a movie in 2012’s mediocre Trouble with the Curve. So the final images of The Mule may be the last we see of him at the movies. If so, what an exit: understated perfection, with a playful hint of subverting his screen image. The Mule is ... Read More