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March 29th, 2024

Insight

For congressional Republicans, it's tax reform or die

Ed Rogers

By Ed Rogers The Washington Post

Published Sept. 27, 2017

For congressional Republicans, it's tax reform or die
For congressional Republicans, it's tax reform or die.

If Republicans can't pass a major tax bill, the rationale for the GOP majority will be obliterated.

In speaking with Republicans on the Hill, I know many think tax reform will be easier than the repeal and replace of Obamacare for a number of reasons.

First, many members of the so-called Freedom Caucus are not oblivious to the harm done to the Republican Party due to their intransigence during the summer Obamacare votes.

Second, questions of tax policy are mostly binary. That is, you either raise taxes or you lower them. And the squabbles to come are not new either. Republicans have always debated questions about pay-fors, which deductions to keep or revise, etc. We know what the fight ahead looks like.

But, as with health care, the Republicans in Congress will probably be unable to pass anything without disciplined and focused help from the White House. Leading the Trump administration's efforts on tax reform are the president's chief economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin. Both are committed to the idea that tax cuts equal economic growth. But beyond that, both Cohn and Mnuchin are imperfect messengers to Congress.

After all, Cohn is mostly a Democrat, and it is feared that he will be departing soon after a tax bill passes. Mnuchin doesn't really know Congress, he has had some distracting media of his own lately and he isn't the best salesman on television. None of this bodes well for the administration's tax reform sales effort.

By far, President Donald Trump's best spokesman on all things economic is Office of Management and Budget Director Mick Mulvaney. He is an intellectually honest, pro-growth expert, and he is a true believer in Trump. He comes from the core conservative wing of the party and was even once a member of the Freedom Caucus himself. Oh, by the way, he knows the details of budget and tax policy better than anyone else in Washington. And yet, Mulvaney is not even a part of the "Big Six" negotiations on tax reform.

Well, he should be.

The failure of health care means that the only big accomplishment left for the GOP caucus to act on in the near future is tax reform. The Republican Party's entire identity and reason for being and for having so much power are riding on this bill.

Anyway, the GOP plan must be sufficient to produce growth, and it has to be defensible as tax cuts for the middle class - not just the wealthy. The mainstream media will never acknowledge the utility of tax cuts and the positive effects on society as a whole that more robust growth would bring. So, Republicans have to be ready for the predictable attacks.

The White House and GOP leaders claimed they'll have a plan by the week of Sept. 25. If that happens, perhaps a final budget resolution will be approved by mid-October.

If it doesn't happen, look for several discouraged Republicans to call it quits and retire. Suddenly, once-safe GOP seats will be in play. The future of the Republican majority will be in doubt. And if Trump doesn't like the GOP-led investigations into matters that affect him and his family, he will truly hate the subpoenas to come from a Democratic majority.

So, failure is a grim reality that no Republican, not even those in the Freedom Caucus - much less the White House - will want to live with in 2018.

Ed Rogers is a a political consultant and a veteran of the White House and several national campaigns. He is the chairman of the lobbying and communications firm BGR Group, which he founded with former Mississippi Gov. Haley Barbour in 1991."


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