Conservatives in a bind over high cost of overhaul
Many of the same conservatives who recently voted against disaster aid because it would boost the deficit voted Thursday to pass a budget that allows for tax reform legislation to add up to $1.5 trillion to the national debt.
So why was this bill different? Quite simply, Republicans say, they need a win.
Republicans have majorities in the House and Senate, along with a GOP president. But it’s been 10 months without any major legislative accomplishment for the Republican Party, and now conservatives find themselves in a tough spot on tax reform.
President Trump is loudly promising sweeping tax cuts, and the party is united in favor of that goal. But if those cuts are not offset, the bill will balloon the federal debt. With Democrats united against the Republican tax plan, GOP leaders can’t afford to alienate moderates in their party by mandating dramatic cuts in domestic spending. Instead, the GOP sales pitch has been that the tax cuts will pay for themselves over time by driving a dramatic increase in economic growth.
“If we had a whole bunch of wins on major items up to this point, would we perhaps be a little bit more deliberate in our negotiations? I think the answer is yes,” Rep. Mark Meadows, R-N.C., who chairs the hard-line House Freedom Caucus, told USA TODAY. “The fact that we need to put up some major legislative victories … certainly factors into how flexible, I think, a number of us are going to be.”
Meadows said he had “a few red lines,” which include getting the corporate tax rate to 20% and the small-business rate to 25%, but otherwise he didn’t anticipate fighting too hard on other aspects of the bill.
Passing Thursday’s bill is the first major step on the road to tax reform. It includes “reconcilia-
“Somehow, apparently, you can’t do tax reform and save money at the same time.”
Rep. Scott Perry, R-Pa., a member of the House Freedom Caucus
tion” language that would allow the Senate to pass tax reform legislation with a simple majority rather than the usual 60 votes requires to avoid a filibuster. Republicans have a narrow 52-48 majority in the Senate.
The bill the House passed Thursday was already adopted by the Senate and differed drastically from the bill the House had passed Oct. 5. The original House bill required that any tax cuts be offset by closing loopholes or cutting spending.
Arizona Rep. Trent Franks, another House Freedom Caucus member, told USA TODAY on Tuesday that he would vote for the Senate’s budget bill even though it was deeply flawed. “The budget is so far from perfect that it’s almost inexpressible, but the importance of tax reform to this country is so overwhelming that we have to get there.”
“Somehow, apparently, you can’t do tax reform and save money at the same time,” Pennsylvania Rep. Scott Perry, another Freedom Caucus member, told USA TODAY. “If we’ve gotta make a choice and either have none or at least have the one, then you’ve gotta make a choice and at least have the one.”
Jason Pye, vice president of legislative affairs for the conservative advocacy organization FreedomWorks, applauded the passage of the resolution despite being “frustrated with the spending levels” it set.
Pye said that it was critical to accomplish tax reform this year and that voting for the Senate budget helped Republicans gain some time to focus on the actual tax reform text.
If the House had not passed the Senate budget, the two chambers would have had to meet to reconcile their differences. That process could take weeks — time that the GOP doesn’t have. Speaker Paul Ryan, R-Wis., has said he hopes to get the House tax plan passed by Thanksgiving so the Senate can pass the bill by the end of the year.
Democrats said Republicans elected to Congress on a platform of ending wasteful government spending were being hypocrites in the budget vote.
Minority Leader Charles Schumer, D-N.Y., said on the Senate floor that “the most scolding deficit hawks have morphed into deficit doves, eschewing principle for political expediency.”