A day later, I’m still confused about the Republicans’ plans for enacting tax reform. One thing that is clearer than yesterday is that Senate Majority Leader Mitch McConnell intends follow the original roadmap and utilize the budget reconciliation process. This is part of an overall trend of the Senate defying the White House which has spawned several articles in response.
I thought White House legislative director Marc Short and Treasury Secretary Steve Mnuchin were clear that they wanted McConnell to give up on the reconciliation process. Even most of the congressional Republicans have concluded that they cannot govern alone with no help from the Democrats. And, with the president still demanding that the Senate complete their work on health care before moving on, McConnell’s plan would both defy that instruction and make it impossible to satisfy.
The reason is underreported but fairly simple. To pass tax reform with reconciliation rules, McConnell needs a new budget to pass with reconciliation instructions. Once a new budget passes, the old one that contains the reconciliation instructions for health care will be superseded and useless. McConnell is signaling (without saying) that the health care effort is well and truly dead.
He’s also defying common sense, because the Republicans want tax reform enacted before Halloween so that it can have some impact before the midterms, but McConnell’s strategy will require the GOP to pass budget bills in both the House and Senate, reconcile those bills together, pass that reconciled bill with the reconciliation instructions, and then pass a big tax reform bill that utilizes those instructions. He needs to get all that done while simultaneously navigating the debt ceiling and pushing through several other must-pass bills, including one (or several) that will prevent a government shutdown. Yet, between now and the end of the fiscal year, the Senate will only be in session for twelve days. McConnell is also sending mixed messages. He has suggested that, unlike with the health overhaul effort, there will be hearings on tax reform. But there’s certainly no time for hearings if they want to pass something on the preferred schedule. Is he abandoning the schedule, too?
This has caused confusion in the reporting, as you can see below:
Sen. Orrin G. Hatch (R-Utah), who leads the Senate’s tax-writing panel, said on the Senate floor Tuesday that he would pursue a more deliberative process than Congress used during the health-care discussions, holding public hearings and working closely with Democrats.
Less than an hour later, McConnell poured cold water on that idea, saying that it was unlikely many Democrats would seek to work with Republicans and that they planned to forge ahead on their own if necessary.
He noted that 45 Democrats and independents sent him a letter Tuesday indicating they would not support a tax overhaul plan that widened the deficit, something Republicans have suggested might need to be part of their package. This, McConnell said, would force them to pass a tax bill along party lines using a process known as reconciliation, which first requires them to pass a budget resolution — something they also have not done yet.
“We have been informed by the majority of the Democrats in a letter I just received today that most of the principles that would get the country going again, they’re not interested in addressing,” McConnell said.
Everything is jumbled here. It’s pretty hard to add to the deficit using reconciliation rules, and it’s supposed to be impossible past a ten-year window. That’s why Bush’s tax cuts expired. Is McConnell conceding that the tax reforms will sunset?
The one thing that is fairly clear here is that McConnell is not willing to concede the need to compromise with the Democrats and is seemingly unwilling to enter into any process that would give the Senate Democrats an effective veto over the final product. That’s remarkable not because it’s out of character for McConnell but because even the Trump administration (if not necessarily the president himself) has already concluded that tax reform will need to be bipartisan and passed under regular order (with the prospect of a filibuster).
McConnell is acting in a more partisan manner that the administration and in defiance of their wishes. He’s asking the administration to trust him one more time to deliver with only Republican votes, and to believe him when he says that he can deliver on schedule. But the schedule is impossible.
Of course, the Democrats pounced on McConnell for using their letter as justification for going it alone. They wanted to know if McConnell was offended that the Democrats don’t intend to widen the deficit or just that they won’t agree to a giant tax cut for the rich. But that’s the politics of the question. What I don’t get are the nuts and bolts. How is this supposed to work?
I think it’s fairly safe to say right now that there will no tax reform enacted this year. It would be doubtful under any scenario, but McConnell’s path requires that too much be done in too few legislative days.
Defying common sense has been a republican specialty since Reagan. After so many years of dishonesty and denying reality is it really that hard to believe they cannot deal with governing in a real tangible world?
I’ve never seen anything like this politically, but I have seen this in business, when the vultures are circling a soon to be dead business with lots of assets.
I don’t think much of the political acumen of most republican senators, but there are some who’ve come up through the ranks: Corker, Coryn, Hatch, Blount. These guys are breaking ranks with both Trump and McConnell. Apparently, McConnell doesn’t care. What kind of Leader ignores the troops AND the Big Boss? Someone who is being blackmailed by forces more feared than the consequences of the actions.
What does McConnell fear (it’s probably not money)? Who is it that he fears? (doesn’t have to a person)? Just for the sake of argument, assume that one of the Mercer’s had credible evidence that McConnell was involved with a turtle slavery ring in Chad. Would his actions make more sense?
Black mailed or paid off.
I don’t think paid off would do it. He has $$$, and can get more easily.
As though having a lot of money kept some people from wanting more 🙂 Greed is a disease.
Of course you are right, Heart, but why wait 22 years? Greed of the sort that causes you to throw away the bird in the hand AND the two in the bush does not spring up like dandelions after a rain (although it does exist … just look at our president).
Haven’t followed McConnell closely enough to know if it’s lifelong or has just appeared, like a dandelion after a spring rain.
Is the answer by chance the reason why McConnell would not allow Obama to go public with the fact that the Russians were meddling in the election process? Maybe the Mercers are more complicit than we realize since their data mining/business model might be more reliant on (Russian) hacking than anyone wants to let on.
In other words, McConnell does the bidding of his corporate overlords, the Mercers and the Kochs. They know the time is short to get their almighty tax cuts they have been clamoring for as long as I have known about them.
We’re learning a lot about McConnell. It seems that what had looked like strategic genius was actually just being in the right (or wrong) place at the right (wrong) time. It seems McConnell has an allergy to bipartisanship. He can’t admit the need for it because it’s against his religion or something. The scorched earth approach has reached its practical limit but he can’t let go.
Maybe he’s just afraid of being primaried from the right. God knows the knuckle draggers loath him. But by the time this is finished, I’m not sure there will be anyone who does not. How many times can one lead a charge into a hale of bullets?
It seems McConnell is riding a tiger not entirely unlike Ryan’s. But his tiger comes in part from a lack of internal flexibility, which is ironic since Ryan’s the ideologue. No one would accuse McConnell of having principles but in some odd scorched-earth way that appears to be the case. Maybe they should be called anti-principles. A principle against principles.
McConnell’s strategic genius was real enough, but it only applies to preventing things from happening. His whole career in Republican leadership has been about saying no and stopping legislation. When it comes to getting things done, he just collapses. In the world of stonewalling he’s king, but in the world of action he’s even more incompetent than Boehner.
See Zach Carter’s twitter for an argument very similar to this. He’s amassed all of this power through scorched earth, but now he is reigning over ashes and can’t do anything with the power he has amassed.
McConnell does not like the Democrats playing the game that he played for eight years. He seems not to like to negotiate at all; is that a lesser element of his skill set?
The Republican purges over the last 20 years now are bearing their fruit in inability of Republicans to sing from the same page on tax reform. Different lobbyists want different things?
I know that I’m focusing on a really minor point in this piece but McConnell is claiming that we need to “get the country going again.” The stock market just hit 22,000, unemployment is under 5 percent (and not to say there aren’t lots of problems yet) but we need to “get the country going again?” Who falls for this kind of propaganda? That’s just a ridiculous statement.
They’re finding it’s not easy to govern with slogans instead of policy.
Republicans fall for it every damn time. They never stopped believing taxes and deficits were going up across the board throughout the Obama presidency. Can’t say whether they don’t know how to read a chart or couldn’t bring themselves to look at one, but the story of relentless decline is the conservative religion, “standing athwart history yelling Stop!”
One could notice that income inequality is still with us. So perhaps the message is not entirely falling on deaf ears. Those with money may be quite smug at the moment but the working class that has supported Trump needs at least something to keep them engaged.
That was the point of my parenthetical – I didn’t at all mean to dismiss the problems of inequality and poverty, but talking as if it’s 1928 all over again is just nonsense.
I don’t know what you mean by 1928 , but inequality is one of three big problems we face to restart growth in GDP. And it has a big impact on millions. So the Rs and friends think a tax cut will fix it. Unlikely, since they are otherwise cutting budget spending.
Agree. I don’t know about that 5% unemployment figure either. Those unemployment figures are cooked up. If people stop looking for jobs – after years of unsuccessful searching – then they drop off the list/stat/number of unemployed. I think the unemployment figure is artificially low and not reflecting that a lot of citizens would be happy to work IF they could find a job.
Secondly, the figure doesn’t take into account what KIND of job(s) you have and whether you’re actually making a living wage. I know plenty of people in my own personal life who are working two and three jobs just to get by. So again, the unemployment figure is not reflecting how that all pans out in people’s lives.
That said, for Republicans to mouth platitudes about “getting the country/economy” going again (or whatever) is the height of hypocrisy. What they mean is that they want to majorly cut taxes for the mega rich and businesses on the patently proven false notion of trickle down, which has never worked. That’s their big “solution” to growing jobs and getting the country going again – give more money to the super wealthy. The end.
Oh and massively cut regulations bc that’ll grow the economy, too…. except it won’t.
There’s plenty that needs to be done to get the country going again, but we’re not going to see much of anything that useful coming out of this Congress or White House.
You got it. Unemployment figures don’t account for all of it and it doesn’t say a thing about what people earn.
It is not 1928 all over again. It is 1927. We have had a three-decade labor recession and a one-decade labor depression for people who make below $100K a year. We have had deflation of STEM job wages and salaries compared to the 1960s and 1970s as a result of inflation of prices and deflation of salary schedules.
At the same time, the highest incomes have become the most inflated asset. The President is the poster child.
In 1929, the inflation of the smartest guys in the room was brought up short. In 2008, it happened for the guys who engineered a go-go mortgage derivative bubble. They will do it again, sooner rather than later because there is nothing signaling reality to them and nothing enforcing prudence. We are almost effectively (through inaction) if not legally deregulated back to the conditions in 1927. All that is needed is for someone to provide the pin to that 22,000 Dow-Jones by asking exactly how much of that is real future earnings. That question was sufficient to tank the IT industry in 2000.
It seems to be tanking the IT companies again, maybe they are the canaries in the mine shaft. There seems little doubt we are in a bubble again. The market is getting way ahead of the economy thinking the tax cuts will juice earnings growth. It will but it is artificial. Then comes the crash.
I don’t think Mitch gives a flying cow flop about income inequality.
Most certainly, he does not.
As with any politician, all McConnell cares about is what’s in for him, first and foremost. Secondarily, he’s concerned about what’s in it for his rich PayMasters. Everything else is hooey and lip service.
Thank you for explaining this. So, if I understand correctly, the recent healthcare abomination was the reconciliation bill that would apply to the FY2017 budget resolution that passed in January 2017, tax cuts for rich people would be the reconciliation bill that would apply to the FY2018 budget resolution, and the FY2018 budget resolution is still pending. Is that all correct?
McConnell’s predicament just underscores the observation that the GOP is great at obstruction, and awful at governing. And they’ve gotten worse over time.
Creating popular legislation is just not in them
That’s because Rs only want to create legislation that benefits the super wealthy. The rest of us can get stuffed.
Yes, they’re pretty good at obstruction, but they’re hopeless fools and lazy @zzes at creating anything other than mega tax cuts for the mega wealthy.
I don’t know why you are confused Martin. Tudor Turtle’s idea of a tax bill is that it will sunset after 10 years. Of course tax cuts are hard to reverse.
I attended a continuing legal education seminar back in 2002 featuring one of the attorney’s who actually wrote the Bush Tax bill, and she told us unapologetically, that their goal was to enact as large of a tax cut as they could, bearing in mind that it would sunset after 10 years. Their thinking was that once the tax cuts had gone into effect, they would become politically impossible to reverse and that Congress would have to get together and extend them.
Well, we all know what happened with that one, but the political logic is identical today. Billionaires get their tax cuts now, and they’ll worry about the law sunset down the road. They figure they can always pass new tax cuts 10 years from now if needed. Keep kicking the can down the road and eventually we’re all dead.
If McConnell is going to pass a tax “reform” by reconciliation before Halloween, it’s going to be a retread of 2001 – just a sunsetting tax cut. There’s simply no time to write a real reform with major changes to the tax system and both winners and losers, and no way to get that through with only 1 or 2 votes to spare (depending on McCain’s health). I assume McConnell is smart enough to know that.