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The Perry flat tax – part of a race to the right

flat_taxToday Gov. Rick Perry announced a part of his economic plan in South Carolina focused on creating a new flat tax for individuals and corporations. I say a part because this particular plan is short on a lot of details and dealing with other parts of the economy. In fact, if this is where Perry leaves it a lot of people are going to be very disappointed and it will probably damage his already faltering campaign. Many have already started picking the plan apart so I’ll just catch the highlights of what I see with references to their positions. It’s very clear that Perry’s announcement of this plan is to try to gain some ground going into the next two months leading up to Iowa and the start of the primary/caucus season. As it stands now, Perry is at 6% and in fifth place in the latest CBS News/NY Times poll, sliding from 23% and leading the pack a little over a month ago. But I’m think his timing may be a little off.

If you dig deeper into the CBS poll you’ll find a few other interesting things. Perry basically traded places with Herman Cain during the course of a month. Cain’s big rise most likely came as a result of his release of his 9-9-9 plan. Perry is guessing he can pull the same stunt and expect the same results. The results also reflect tea party sentiment, showing the same result stack with different percentages with most of the pull being away from Romney and Undecided voters. We can expect the Romney pull but it’s really only 3% so it’s not as significant as one might think. It also shows the tea party seems to be locking in on their candidates now as a result of the debates, moving from 18% Undecided in September to 8% in the latest numbers. Note also that Gingrich seems to be picking up steam and could end up facing off against Romney. While his numbers aren’t as radical as Cain’s or Perry’s it seems to show he’s not losing his base and may be picking up supporters while keeping a stable message. Ron Paul seems to be in the same situation.

Cain and Perry have been playing with gimmicks lately to try to leapfrog Romney. Cain did it with 9-9-9 over the course of the past week, even after his challenging performance during the Las Vegas debate. Most expected him to be in the hot seat going into the debate and, while the reports are varied, many feel he held his own throughout it. It did put more scrutiny on the 9-9-9 plan but even with that scrutiny the plan seemed to weather and hold him in the lead. That may be why the Perry team is taking the gamble with the 20% flat tax plan at this point. Based on where Perry sits anything that appeals to the Republican base will be an improvement.

That’s a key thing to consider at this point. All the candidates are really playing for the Republican base, as difficult as it may be to pin down. The goal from now until securing enough delegates for the nomination is to convince core Republicans you are the best representative for the party. The problem is that core has been hard to nail down over the past two years. Coming off the 2010 election, tea party voters feel they have claimed the core and that candidates should appeal to their mandates of less government and lower taxes at any cost.

Today The Atlantic took a stab at what seems to make core Republicans “squeal like tweens at a Justin Bieber concert.” The key issues: Birtherism and Transcriptism, Repealing Obamacare, Not Raising the Debt Ceiling, Swag (read The Atlantic description for this), and Simple Tax Plans. In the past few days, Perry has hit at two of those items by toying with the birther issue when talking with Donald Trump and rolling out his flat tax plan today. Regarding the birther issue, I think some tea party and Republican leadership are wanting to put that to rest as soon as possible and quit dragging it up. Erick Erickson of Red State put it best by saying “Birtherism is a dangerous topic to handle because it inflames the passions nuts. They’re already going after Marco Rubio now. Perry should be cautious. I hope his campaign will get him on message.”

The real question now will be how much of a bump Perry’s flat tax plan will generate in the coming weeks to the next real debate scheduled for Nov. 9th. There’s about 2 weeks between now and that debate. Interestingly, Newt Gingrich rolled out his flat tax plan yesterday in an op-ed in the Quad City Times, a local newspaper in Iowa.  The problem is op-eds don’t garner a press event like showing up at a business in South Carolina, Perry’s apparently adopted state. Ron Paul has his current plan but probably needs some tweaks to make it more appealing. Currently Paul says that for it to be effective, the 16th amendment authorizing the income tax would need to be repealed.

With all the tactics being parts of a “race to the right” to get the nomination, a bigger question will be how well these issues will play during the General Election. In Texas, we saw a similar situation when Debra Medina, the tea party favorite, enter the gubernatorial race and force Perry to defend the core right. The difference between that situation and now is that the voter center in Texas is already skewed to the right in most parts of the state, unlike the nation where an Electoral College maps kind of screws things up for typical campaigns. When the nominations are set that Republican candidate will have to appeal to the key swing states to win the election, some which lean more blue than red.

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