Trump’s moves on immigration will make him hated. Bring on the tax cuts.

Trump’s Moves on Immigration Will Make Him Hated. Bring on the Tax Cuts!

Trump’s Moves on Immigration Will Make Him Hated. Bring on the Tax Cuts!

Who's winning, who's losing, and why.
Sept. 14 2017 8:28 PM

Trump Is Playing Two-Dimensional Chess

The president wants to be loved. His moves on immigration will make him hated. Bring on the tax cuts!

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President Donald Trump and Melania Trump put on gloves to had out food on Thursday in Naples, Florida.

Brendan Smialowski/AFP/Getty Images

Donald Trump is feeling desperate. The president is at long last reckoning with the fact that he is profoundly unpopular, which has proven a tough pill to swallow for a man with a yearning desire to win the approval of the hosts of various cable news programs. To the dismay of immigration hardliners, he seems to have concluded that the surest way to resuscitate his presidency is to broker a deal with congressional Democrats on protecting the Dreamers, or some smaller or larger subset of unauthorized immigrants. As is typical of Trump, he is walking into an obvious trap. A short while from now—my guess is that it’ll be about a week—he will need to make another move to keep everyone in America from hating him. The good news is that I know exactly what he has to do.

To make an obvious point, there is a big difference between Trump putting forward a narrowly tailored solution for those who are currently eligible for DACA versus throwing his support behind a more expansive measure, like the latest iteration of the DREAM Act, sponsored by Sens. Richard Durbin and Lindsey Graham. I can promise that if the president backs a more narrowly tailored solution, his intimations that it would be horribly cruel not to protect young Dreamers from deportation will be thrown back in his face. Yet if Trump makes too many concessions, he risks antagonizing some of his core supporters.

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Trump has said he wants protections for the Dreamers to be part of a package deal that will include increased spending on immigration enforcement, but not spending for his long-promised border wall. Fair enough. This is a deal at least some restrictionists might find acceptable, provided the immigration enforcement measures are meaningful. Scholars at the restrictionist Center for Immigration Studies often emphasize the importance of tightening workplace enforcement, to help ensure that firms are not hiring unauthorized immigrant workers. Is there any prospect that congressional Democrats would accept such concessions? My guess is that although they might accept token spending increases, they’d balk at a serious workplace enforcement effort. So too would Republican lawmakers solicitous of the interests of unscrupulous low-wage employers.

You might think Trump could just walk if he doesn’t get a good enough deal. The president, though, has staked his reputation on his supposed dealmaking prowess. If he fails to secure a deal, and if Morning Joe loses patience with him, he is liable to bug out.

At this point, I find it highly unlikely Trump will be able to cut a deal that will satisfy immigration hawks. It’s possible he’s concluded that they’ll stick with him regardless of how much he betrays them, out of tribal loyalty if nothing else. The trouble is that opinion on immigration is asymmetrical. As a general rule, immigration hawks care more about the issue than immigration doves. Even if the president shifts hard to the left on immigration, it’s unlikely immigration doves will suddenly decide the man who accused Mexican-born immigrants of being murderers and rapists is in fact a chill dude. It’s Trump’s hateful language about immigration from the campaign that they’ll remember, not that he caved on the issue as president. Immigration hawks, meanwhile, will be hopping mad if the president sells them out. Although they’re unlikely to abandon him completely—they’ll still prefer Trump over Elizabeth Warren or Kamala Harris, who will no doubt take far more dovish positions on immigration—they’ll be less inclined to forgive future transgressions.

That brings me to Trump’s next move. Right now, Republican lawmakers are wrangling over all manner of tax policy questions: how low the corporate tax rate should go, whether pass-throughs should get even more favorable treatment than they do under the current tax code, how exactly to rejigger the marginal tax rate schedule, and more. One flank of the GOP wants 1986-style revenue-neutral tax reform, which will inevitably mean angering tons of people who will lose out as their deductions and credits are trimmed, consolidated, or eliminated outright. Another favors a George W. Bush–style temporary tax cut, which will involve a lot less pain, but that will also be less likely to spur the kind of long-term behavioral changes on the part of investors and employers that could boost long-run economic growth. On substantive grounds, reform is the better way to go. But passing a serious tax reform measure is also next to impossible, not least because the Trump White House is utterly incapable of knocking heads together to make it happen.

Trump’s path of least resistance, then, will be to champion a temporary tax cut aimed at the ultrawealthy, which will jibe with the sensibilities of his top economic advisers. But if he really wants to be loved, and to change the perception of his presidency for the better, he should instead back a progressive payroll tax cut aimed at low- and middle-income earners and an increase in the earned-income tax credit for childless workers. He should also push for a massive expansion of the child credit, one that would make it refundable against payroll taxes, which are far more burdensome than income taxes for most working- and middle-class parents, as Ramesh Ponnuru of National Review has noted. And as an added bonus, Ivanka Trump has emerged as the No. 1 champion of the idea inside the White House.

Taken together, these seemingly small tax tweaks would undoubtedly cause the deficit to increase. While it’s not hard to imagine how these tax cuts could be offset by well-targeted hikes elsewhere, let’s be serious: Trump isn’t going to want to raise taxes. What he cares about most is goosing his approval ratings, and this delectable little prix fixe of budget-busting tax cuts should do wonders in that department.

One more thing

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