This transcript is automatically generated
Nothing excites the folks here in Washington like a sex scandal may have got one going now with GOP front runner Herman Cain.
Nothing excites the Washington leaves more than the idea of getting the media and voters away from talking about big government and talking about something irrelevant like sex.
Our next guest is an economist a prominent economist -- -- 999.
But he's now talking about whether or not after many people have criticized it this is even politically feasible is America ready for a national sales tax.
Here to discuss is the Wall Street Journal senior economics writer and my good friend and freedom watch regular Stephen Moore.
Co author of return to prosperity.
How America can regain its economic superpower status.
Steve it's a pleasure well.
-- -- and none of them into the sand in the freezer don't know America don't stay here to watch there is something in the water and I'm calling at the belly of the biggest I haven't returned nearly water out of -- -- -- thank you.
The 999 plan that does seem to have got Herman -- a lot of traction he still has the traction what we'll see how long it Lance.
Is America ready for something we've never had.
A national sales tax well.
Let me just start by giving the brought over here I think the regional and Herman Cain has -- vaulted -- first or second place depending on the polls right out of nowhere.
-- because he's been -- involved that he has this idea blowing up the tax system and you know one huh especially among.
Republican primary voters that is a very powerful idea I -- find someone who can defend this current tax system it's indefensible.
So so I think that's this idea that he's got the bold -- plan out there.
It is really unlock -- really sure -- understand -- a flat rate income tax at 9% and no deductions -- so -- -- not -- -- -- -- right.
9% sales tax and everything went our violence or an automobile or strike OK and 9% corporate income tax or are there ordinary corporate expenses deducted from that this is a corporate -- a tax on corporate profits that's right okay our.
Now some haves and I think congresswoman Bachmann if if I have this correctly.
Give the government should take a -- on the let the government tax 9%.
On sales today that early 19%.
Before president -- -- finished with this very diligently to say about -- -- very legitimate concern and we voice this concern -- the wall street journal editorial page saying wait a minute they give national sales tax on top of an income tax.
Gives us little indigestion and so the problem is judge you know this is -- no deterrent you don't wanna give them that the government and the congress to -- To pull to get more revenues so that's something that's made us an easy you know hurricanes -- way we got the rates so low.
That the risk of this is is side is very infinitesimal I don't I -- disagree with -- -- I think the risk that.
You know was 9% -- and 11% I mean this is what happened in Europe as you know we have these sales taxes and every year you know in Greece and he's got a trigger trouble they -- -- even more insidious it's gotta value added tax is just in the the prices in the -- except you almost can't tell how much of what you're buying is going to them vs selling -- on how much is going to the government.
Switching gears a little -- are you surprised that -- our lifetimes I'm a little older than you were basically the same generation.
Serious people running for the presidency -- talking about getting rid of the IRS as we have no I'm not you know this is.
Seaports is a good friend of mine in front of yours right I still Steve you know -- fifteen years ahead of your time because remember he was the first guy who right about where I was and how.
-- -- I'm gonna say this on the record.
I think America's ready for for this death tax on whether it's the 999 a way to repair is talking about the flat tax but the idea of the only people can defend this current tax system our tax preparer said -- -- and the big government acceptable because this is a key point.
This issue of getting rid of the tax system.
This is the ultimate Washington DC vs America Copa America wants cigarette I think.
Nobody around New Zealand -- the people -- the street you wanna get rid of being is that credit get a power is the resurrection of of lawsuit which appears to have been frivolous and which was settled amicably and quietly.
Fifteen years ago just a sideshow as I said of the introduction to segment because people don't wanna discuss what's really affecting us -- -- Washington loves sex cattle let's just kept.
I -- how do you.
A pleasure my -- thank you for joining us spending gloom and doom will --