The winter, spring, and summer of their governing act having flopped in spectacular fashion, Washington Republicans are desperate to pull something — anything — out of their hat this fall. A cute, crowd-pleasing rabbit would certainly be wonderful, but at this point, a star-nosed mole, a sculpin, or even a mangy public-policy polecat would suffice. Speaking of the latter, the Senate is mounting yet another effort to replace the Affordable Care Act. This rushed attempt appears even worse than the last several endeavors. Which is saying something, given how bad those were. John McCain, Susan Collins, Lisa Murkowski — and any other Republicans senators who combine some courage with a sense of decency — your country needs you again.
Then it’s on to tax reform, which is more likely to be tax cuts sailing under a false flag, though there’s admittedly some confusion here, thanks to President Trump. Asked last week if upper earners would get a tax cut, Trump said their taxes would stay pretty much where they are — and might even go up. (Imagine the consternation in the ranks of the GOP establishment: And to think, he calls himself a Republican!)
If genuine, that stance would speak well of Trump. Chances are, however, that it’s merely a smokescreen. Witness his prevarication on repeal-and-pretend. Or the fact that last week’s comments are at odds with the tax-package principles his team has laid out.
Which means voters must be alert to efforts to peddle them a pig in a poke. One telltale indicator: If the revenues lost to rate reductions aren’t largely offset by a broadening of the tax base, you don’t have reform, but rather just a tax cut.
The question then becomes how the tax cuts will be paid for. By budget cuts? With more debt? Or both?
Time was, Republicans would gloss over hard budgetary realities by asserting that their tax cuts would pay for themselves, but that notion is now so discredited that few utter it outright, for fear of ridicule. Still, be wary of that same claim in slipperier forms. Like, say, Miracle-Gro economics: talk of sparking the kind of high and sustained rates of economic growth that mature economies seldom see.
You may also notice some putative deficit hawks turning a blind eye to the prospect of a hurricane surge of red ink, as long as it’s precipitated by tax cuts rather than government spending.
Take, for example, the Wall Street Journal editorial page, which is warning Republicans not to “hold themselves hostage to a budget process that is hostile to pro-growth tax policy.” If the Congressional Budget Office says the tax package won’t be revenue neutral and the budget rules don’t allow a permanent tax cut that’s not, well, damn those tax-cut torpedoes. Ignore the analysis. Change the rules. Full steam ahead.
In the real world, of course, if tax cuts aren’t balanced with spending reductions, the federal fisc goes deeper into debt. Younger voters should be particularly concerned, since that increased debt will fall on their budgetary shoulders, which means there will be less federal revenue available for other uses.
Finally, look askance on calls, like Trump’s of last week, to make the tax code simpler and fairer. If you take fairness to mean that those who earn more should pay a larger percentage of their income, then simpler isn’t fairer. A flatter tax code means fewer rates, which reduces progressivity.
Bear all that in mind, and it will help you track the Republicans’ real moves and motives as they try to avoid a humiliating political pan of their performance in the first year of the Trump era.