The Senate is expected to vote on the Republican tax reform bill later this week. Until they do, Slate political writer Jim Newell and economics writer Jordan Weissmann will assess the bill’s chances of passage in daily Slack chats. This is the first of those chats.
Jordan Weissmann: So, as of today, how likely would you say it is that the entire state of New Jersey’s taxes are about to go up? (I kid. Only, like, half of Jersey would be screwed.)
Jim Newell: Likely! As in, I don’t see this effort dying. There are a couple of clusters of senators with objections, but neither seems insurmountable.
Weissmann: OK. Don’t break my heart quite yet. Who are the important holdouts at this point? And don’t say Jerry Moran. He just likes pretending not to be a backbencher.
Newell: So there are the (what we’ll call for lack of a better term) “deficit hawks,” who see showering $1.5 trillion mostly on corporations and the wealthy as not too fiscally prudent: Bob Corker, Jeff Flake, James Lankford. (And Jerry Moran!) Then there are a couple of senators from business backgrounds, Steve Daines and Ron Johnson, who want to equalize the tax cuts for pass-throughs with those of C corporations. Then there is Susan Collins, who has several problems, but is only one vote and also I don’t think is unreachable. I think these issues could get “resolved” enough to get the votes from each cluster.
Weissmann: I’m kind of surprised you think Collins is reachable. I thought her whole shtick was to vote like a Democrat but keep an R by her name so she could run for governor in Maine with indie cred.
Newell: Well, she opted not to run for governor. A few of her issues have theoretical answers: Worried about the individual mandate repeal? Pass Alexander-Murray and a reinsurance bill she introduced. Worried about repeal of state and local deduction? Keep a property tax deduction, as the House did, and as some other senators want to do. I am not betting that she will vote for it, but just noting that she doesn’t hate the overall concept of this bill as much as she did the health care bill. Which bodes well for its chances among everyone else.
Weissmann: Wait, I missed the governor news? God I’m behind.
It sort of seems like the deficit hawks actually hate the whole concept of this bill at this point, though. Given that the concept is to pass a deficit-financed tax cut.
Newell: But they are working on a plan for that!
Weissmann: Is this the automatic tax-hike thing Lankford suggested? Because Jesus that thing is terrible.
Newell: Yes. The “backstop” or “trigger” or “circuit breaker,” as this plan, about which we have no details, is being called. Corker, Flake, and Lankford are all working on it.
Weissmann: It’s…so…so…painfully…excruciatingly dumb. Basically this thing would automatically raise taxes every time revenues fall short. So any time we had a recession, taxes would go up. Hurray!
Here’s what I don’t get about this. The deficit hawks supposedly hate this bill because they don’t think the sunsetting individual tax cuts will actually sunset. So what makes them think anybody will actually allow their precious “circuit breaker” to go off as designed? Like, is the play here that, if Democrats are in charge, they’ll at least allow automatic hikes on corporations? And why would corporations, which want permanent tax cuts, back this idea?
Newell: All good points. But it might be enough of a charade to get these people to yes.
Weissmann: But two of these guys, Flake and Corker, are retiring. Why would they buy into a charade? They don’t have to fool any voters. Do they need bullshit talking points to gently whisper to themselves in the mirror? I don’t get it.
Newell: I think they are still under enormous pressure from their peers to ensure that donors continue writing checks to the Republican Party.
Weissmann: I would kind of be OK with watching the Republican Party burn down if I were Flake or Corker. But maybe that’s me projecting? Like, if you’re Jeff “Conservatism Has Lost Its Soul” Flake, you kind of have to be in “we have to burn the village to save it” mode by now, right?
Newell: Eh, Jeff Flake also likes tax cuts though.
Weissmann: True.
Newell: One more thing. The Budget Committee is set to vote on the bill tomorrow, the last step before it hits the floor. And that vote is looking dicey right now. Ron Johnson has said he won’t vote for it in committee if he hasn’t signed off on the pass-through changes yet. And the committee breakdown is 12 Republicans to 11 Democrats. Corker, also on the Budget Committee, wouldn’t say that he was sure he would vote for it in committee either.
It is very hard to see it failing in committee but as of right now… it doesn’t have the votes to pass committee?
Weissmann: Huh. So, how big are the pass-through changes Johnson wants?
Newell: I think he wants more than they can offer. Hard to tell what he (and Daines) will settle for.
Weissmann: If he wants a fundamental change to how that thing is structured, that’s a big ask.
Newell: Daines is suggesting a move where you improve the bill for pass-throughs while no longer allowing C corps to deduct state and local taxes. So you equalize the treatment from both ends.
Weissmann: Ahhhhhhhahahahahahahahahahahaha
Sorry. I just, I can’t.
That is…not a last minute tweak you make to get something out of committee. It just isn’t.
Newell: Unless it is! Or find something else. Point is: Rejigger the pass-throughs for Johnson and Daines, come up with THE TRIGGER for the deficit people, and you can find your 50-51 votes.
Weissmann: Alright. So there’s a path to 50. It just involves some major last minute changes nobody has fully analyzed and some obviously bad policy thrown in for cosmetic purposes.
Newell: That’s how Congress rolls. There’s always conference committee!
