Rewriting Tax History
With the recent statements made by Republican leadership about a newly-found desire to be bipartisan, it is important to note Republicans’ efforts to rewrite the history of their completely-Republican tax bill of 2017. If past is prologue, there will be more partisanship to come and it will be focused on those Americans least able to defend themselves.
Republicans now claim that they labored strenuously for the support of Democrats on taxes. Yet, Senator Mitch McConnell, R-Ky., said time and time again that tax reform would be built around pure partisanship. True to his word, Republicans would come to use what’s known as reconciliation. Reconciliation is a special procedure in the US Senate where one party can pass legislation with a spare majority using only the votes of their side. Knowing that bipartisanship was never on the menu, reconciliation was the order of the day to pass a tax bill.
Senator Pat Toomey, R-Pa., implied that Democrats opposed tax reform from the moment they get up in the morning, and Senator Ted Cruz, R-Texas, arrived on the Senate floor to assert that all currently-serving Democrats had rejected the thinking of previous Democratic tax reformers, specifically longtime bipartisan leader Senator Bill Bradley.
Unbeknownst to Senator Cruz, Senator Bradley said that passing the Republicans’ tax bill was “like handing the American people a Molotov cocktail with the fuse burning.” Senator Bradley went on to condemn the bill for favoring special interests and the most fortunate, exploding the Federal budget deficit, and keeping the painstakingly complicated tax code as Byzantine as ever.
As for Senator Toomey, he knows Leader Schumer and Senate Democrats said repeatedly that tax reform could be bipartisan as long as it gave the middle class a fair shake. Seventeen moderate Democrats appealed to Republicans for bipartisanship and I wrote two full bipartisan tax reform bills with former Senator Judd Gregg, a conservative Republican who previously chaired the Budget Committee, and former Senator Dan Coats, who is now a member of Trump’s cabinet. Senator Sherrod Brown, D-Ohio, told the President at a session attended by a number of Senate Democrats that if he put the focus of a tax bill on the middle class and bringing good paying jobs back to the United States, he could have gotten “70 or 80” votes for tax reform.
Senate Democrats put our core principles on paper. They were an updated version of what President Reagan and Senator Bradley agreed on in 1986: Boost the middle class — as our
predecessors agreed: there should be equal tax rates for wage earners and investors — fiscal discipline through revenue neutral tax reform and leaving the social safety net unharmed.
In return, Gary Cohn, National Economic Council Director and the White House point person on taxes, told Democrats to accept the Republicans last, final offer based on a few pages of online generalities — even before any legislative text was available to see. Republicans ultimately muscled through an inherently partisan bill that made benefits for multinational corporations and the politically powerful permanent while breaks for the middle class were written in disappearing ink.
Unlike 1986, when Senator Bradley flew around the country to meet with key Reagan Administration officials to work out specifics about tax reform that brought both sides together, Republicans this Congress would not even walk down the corridor to put bipartisan tax reform ideas down on paper. This is the real “tell” about someone’s motives on tax reform. Because tax policy is so complicated, it is not really on the level unless it’s put down on paper and then discussed. As the Ranking Democrat on the Senate Finance Committee that deals with taxes, I never saw anything from any Republican on paper that outlined ideas for serious bipartisan cooperation. And I certainly was never given the opportunity to discuss any of these difficult issues with my Republican colleagues.
After a White House meeting with the President and five Democratic Senators up for re-election in states won by the President (who threatened he wouldn’t want to be in their shoes if they did not support him on taxes), I received a phone call from Treasury Secretary Steve Mnuchin. He called me to say that Senate Democrats would shortly receive a document outlining the specific provisions — like boosting the middle class — that would be the basis of bipartisan cooperation. No such document was ever sent.
What transpired was a partisan markup of the Finance Committee where not a single Republican voted to support any Democratic measures that would have put more money in the pockets of the middle class. This sham process continued when House Ways and Means Chairman Kevin Brady, R-Texas, led a conference committee “in name only” to reconcile the differences between the House and Senate tax bills. Instead of having an open and transparent debate on a final deal, Chairman Brady made up the rules as he went along while the real details were being hammered out behind closed doors, without Democratic input. This is surprising when, shortly after the 2016 election, Chairman Brady and I received awards from the Tax Foundation for bipartisanship. At the time Chairman Brady told me he would be in touch about taxes. In the more than a year that followed, there was never a call.
Tax reform in 2017 could have been bipartisan. With it, our country would have been in a far better position to tackle the great challenges ahead. Democrats continue to believe hope springs eternal. But the evidence of the last year certainly indicates the “our way or the highway” approach will be what drives the Republican agenda in 2018.