Tax cuts are not worth the GOP's soul
It profits a party nothing to give its soul for the whole world ... but for tax cuts, Republicans?
During the 2016 presidential campaign, pundits routinely tried to predict the fatal gaffe that would inevitably kill Donald Trump's candidacy. But nothing did the trick. No matter what Trump did, Republicans simply wouldn't quit him.
Yet many might have dumped Trump if the candidate had seriously suggested raising taxes. That's apparently something the modern GOP can't tolerate. And Trump certainly understood this, which is why he portrayed himself as an uber "supply-side" conservative on tax cuts despite heresy on other supposedly core issues such as trade, entitlement reform, and an internationalist foreign policy. He knew tax cuts — along with abortion and Reagan veneration — were a Republican red line that even he dare not cross.
It's certainly a harsh indictment to say a political party will overlook "casual cruelty" in public discourse and the undermining of democratic norms as long as its favored candidate or even president supports this or that economic policy. But look at what's happening right now with the GOP. In recent days, former President George W. Bush and three sitting Republican U.S. senators — Bob Corker, John McCain, and Jeff Flake — have offered stinging rebukes of Trumpism. In normal times, such actions by such high-profile party voices might have encouraged others to speak up and say in public what they already say in private about the 45th American president. Instead, many Washington Republicans are angry about this spate of truth-telling because it might hurt the precarious effort to cut taxes.
This New York Times report captures the mood of the GOP Congress: "Well aware of the mercurial nature of the president, most congressional Republicans are loath to do or say anything that could upset Mr. Trump and risk provoking an early-morning Twitter tirade from the White House when they are trying to delicately piece together a complex tax agreement."
Democrats probably see this as "donorism" in action. Republican lawmakers are merely responding to wealthy patrons who want lower tax bills at all costs, the Republic be damned. Just cut taxes for the folks who send the fat checks.
Now, of course, Republican politicians care about the wants and wishes of their contributors, as do their Democratic counterparts. But what's mostly going on here is something more fundamental. Many Republicans — whether rank-and-file members, big-time donors, or elected officials — simply have an inflated view of the importance of tax reform. If only the tax code were tweaked just the right way, the economy would boom, just like under Reagan! This is the final opportunity to prevent inexorable decline, slouching toward Europe.
Sure, tax rates and how a tax code is structured are important for economic growth. On this, most economists agree, whatever their political leanings. Unfortunately, part of being "well designed" is being paid for, and Republicans are having a hard time with that. And as things stand, the GOP tax bill is not shaping up to be a game changer, given both its total size or its details. Goldman Sachs, for instance, is predicting a $1 trillion tax cut that raises economic growth by maybe a tenth or two tenths of a percentage point a year over the next couple of years. That's not nothing, especially with a U.S. economy barely averaging 2 percent annual growth since the Great Recession. If the ultimate goal, however, is better policy to help grow the U.S. economy nearly as fast in the future as in the past and provide as much opportunity as in the past, tax reform is just one piece of the puzzle. So is regulatory reform that focuses on increasing corporate competition. So is education and training reform that empowers a flexible and tech-savvy workforce. So is housing reform that enables more workers to live where the best jobs are being created.
But tax rates rise and fall. Regulations are implemented and then changed or repealed. What must endure are defining values of the great project that is America: freedom, equality of opportunity, constitutionalism. These should be the lodestar principles of any U.S. political party. Politics and policy should be judged by how they move the nation toward an ever more perfected realization of those principles. The truth-telling by Bush, Corker, Flake, and McCain should be recognized as a great moment by the 163-year-old Grand Old Party, whatever its effect on tax reform.