Tuesday, December 19, 2017

The Craziest Part of the Tax Plan Is How We Got Here

After a disastrous first year defined by scandal and Resistance, Donald Trump has achieved little besides installing judges, gutting federal regulations, and terrorizing people of color and the LGBTQ community. But with his allies on Capitol Hill inching closer each hour to an historic tax cut for the richest Americans—one that every nonpartisan analysis says will explode the deficit and do little to help the economy—his first legislative win is within reach. Of course, just about the only real winners will be rich people and large corporations, but still, a win is a win, right?

Actually, no. Republicans have passed tax cuts before, most recently during the George W. Bush administration, when they also increased the national debt while fueling income inequality and disproportionately benefitting the rich. What's new this time is the process, which has been rushed to an insane degree. Just before the Senate version passed, legislators were scrawling changes in the margins of the bill; in the course of reconciling the House and Senate versions, provisions were added that appeared likely to enrich individual lawmakers. Now the bill is believed to have just enough votes to pass under budget "reconciliation," where a bare majority is sufficient to enshrine something into law, rather than the usual 60 votes needed to overcome a filibuster.

This mess isn't something that can be blamed solely on Donald Trump, however. Congress has its own set of problems, including greed, lust for campaign donations, and a general apathy toward the poor. For some perspective on how we got to this horrible place, I called up Norm Ornstein, a resident scholar at the conservative American Enterprise Institute and a longtime observer of Congress. He's been a sharp critic of legislative dysfunction and partisanship, particularly on the Republican side in recent years. Here's what we talked about.



VICE: It's not exactly uncommon for conservative Republicans in control of the government to use their political power to cut taxes. You've seen tax cuts happen many times in the past, usually under Republican presidents. Why is this case so different?
Norm Ornstein: If we go back to virtually every other tax bill that was a tax cut or even a tax reform or a tax change, there was significant bipartisan participation. Even where there was a lot of controversy. In 2001, the Bush tax cuts would not have passed if it weren't for [senators] Max Baucus and John Breaux and other Democrats joining in.

Even before 1986, we got Reagan and others who understood that the cuts they hoped would raise revenue were adding to deficits, and we had tax increases done on a bipartisan basis in 1982, '83, and '84. And the '86 reforms of course were a model of bipartisan cooperation.

In every instance, and that includes this one, you have people from the other party ready to participate. The reality is that [the Republicans] didn't need to do this through reconciliation. There were 60 votes easily to be had for a tax reform that would very much have transformed the tax code structure, and along the way reduced rates and did the same kind of rate reduction and base broadening that was the model in 1986 and that remains the frame that the overwhelming majority of economists say is the right way to go.

This was a conscious choice to shut out the other party and you could see from the direct statements made by [Speaker Paul] Ryan and others—they had a president who they knew would sign anything they put in front of him, and they saw this as a once-in-a-lifetime opportunity to get what they wanted and they saw no need to compromise.

So you don't see this as necessarily being about this White House being evil—this is really abut choices made by the Republican leaders in Congress, right?
I'm not going to suggest that the White House is entirely benign here. If you look at the White House process, you have [Treasury Secretary Steve] Mnuchin flat-out lying and saying that the office of policy analysis or whatever it's called in the Treasury Department was working away at a model or report when they weren't, and then they come up with this one page that's just an embarrassment. And then you have Mnuchin going on television just yesterday and flat-out lying and saying rich people are going to pay more. So I don't hold any great respect for the way the administration handled it, but the tax bill was not a product of Trump's presidency, it was a product of congressional leadership.

How damning was that story about Republican Senator Bob Corker suddenly supporting the bill once it stood to make people like him richer, and do you expect all this extra scrutiny to flip his vote?
On the latter, I don't know but I'm doubtful. But what's the most benign explanation for Corker turning on a dime? The most benign explanation is that [Majority Leader Mitch] McConnell went to him and said, John McCain is not going to be there for the vote. We are down to a margin of two. If you continue to vote against this, Susan Collins [of Maine] is going to face unbelievable pressure. We can't do that to her, we need this badly, we need you to take one for the team.

That's the benign explanation. That explanation, given Corker's previous statements and record—I won't vote for a bill that raises the deficit or debt by a dime—the fact that he voted against it the first time and will vote for it this time, it doesn't reflect well on him. But we also know John Cornyn pretty much said that we included this provision because we needed the votes. Whose votes did they need? They had everybody else's!

If I'm Bob Corker at this point, I'm pretty much stunned by the reaction, because you're going to be leaving this body, and leaving public life, and this will be what people will remember, and it will be an enormous stain on your integrity. I've known Corker for some years, I consider him a friend, I've publicly admired him as somebody who's a problem-solver. To leave this way, you've gotta at least be thinking about it. Collins, I'm just baffled, because she set out criteria, none of those criteria have been met. This bill clearly just really sticks it to Maine and the people in Maine. It's extraordinarily unpopular there. The tax provisions aside, what it does to the health care system, now you've got all the physicians in Maine, the providers, saying flatly that this is just a disaster for them.

In light of how this process is playing out and what we may see in the final bill, do you expect Democrats—if and when they do manage to get control again in the Senate—to get rid of the filibuster so they can pass any legislation with just 50 votes?
I hope not, but I don't know. It really depends on how everything plays out—you're not going to get rid of the filibuster if you have a Republican president, obviously. If we see more outrages happen in the course of the next couple of years, and we end up with a wave in 2020, but Democrats fall short of the 60 votes, I think the pressure on them to do so will be severe.

One of the main reasons that I have been so unhappy with McConnell blowing up all the norms of the Senate is that this really is a downward spiral. Once you start down this path, you're left, as the Democratic Party, saying, Any gesture that we make to return to the regular order we know is not going to met in kind when they're back in power.

Every piece of major legislation requires technical corrections. When the Medicare part D program went through—on a much more partisan basis than it originally started—Democrats participated in the technical corrections so that it would work. Then Republicans refused to do it for the Affordable Care Act. And now the Republicans are going to be begging for one on the tax bill, and if I'm the Democratic Party, I'm gonna say, If we do this, we know that it's not going to be met in kind when we need it again in the future. So you're basically creating a really unhealthy atmosphere, and I don't know where it stops.

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