Republicans are so obsessed with their precious tax bill that they’ll do anything to pass it.
As the Tax Cuts and Jobs Act of 2017 slouches toward the Senate floor to be born, the most fascinating question that is beginning to be asked is this: Exactly what are Republicans willing to sacrifice politically to give themselves and their donors this shiny, gauzy Christmas gift, as precious to them as the ring of power was to Gollum in Lord of the Rings.
It is, after all, a far from risk-free undertaking. While tax cuts as an abstract matter are usually popular, a bill that places lower taxes for corporations, heirs, and wealthy “pass-through” business proprietors first, and swells budget deficits enormously, is not a way to make friends and influence people outside boardrooms and Wall Street.
Indeed, as FiveThirtyEight’s Harry Enten explains, polling shows that this tax bill is far less popular than its 1981, 1986, 2001, and 2003 antecedents, and is actually less popular than several tax increase bills. Only about one-third of Americans support it. And aside from the perception (and reality) that it primarily helps the wealthy, voters prefer big tax bills that are shaped by bipartisan compromises; this bill is a Republican-only production, which also means its unpopularity will reflect poorly on its creators.
Beyond that, this bill concentrates much of its pain on upper-middle-class swing voters in geographical areas which happen to harbor a goodly number of vulnerable Republican House members. The most widely understood and controversial provision is the elimination (partial in the House bill and total in the Senate bill) of the tax deduction for state and local taxes. This affects people in high-tax, high-income states the most, including California, Illinois, New Jersey, and New York. According to the latest Cook Political Report analysis of House races, there are 13 House Republicans in vulnerable seats in just these four states, more than half the number Democrats would need to regain control of the chamber and break Republican hearts everywhere. Yes, going after the SALT deduction is essential to the math of the tax bill. But it could be very expensive politically.
The bill also includes a repeal of the Obamacare health-care purchasing mandate which the Congressional Budget Office says will cost 13 million people their health-insurance coverage while boosting individual insurance premiums 10 percent per year beyond the increases we can already expect. According to an analysis from the Los Angeles Times, the damage from this provision will be concentrated in pro-Trump rural areas, many of which are in competitive House districts or states with competitive Senate races.
With Republicans fighting to hang onto the House and increasingly worried about hanging onto the Senate, why would they pursue such a large and unpopular tax bill in so partisan a fashion, knowing at this point that it could well be their only major legislative accomplishment before the midterm elections?
New York’s Jonathan Chait argues persuasively that the tax bill rewards highly influential GOP constituencies, including campaign donors, and reflects conservative “theology.” You can indeed make a case that using the trifecta power Republicans have at the moment (and could soon lose) for this major priority is precisely the grand strategy that drives Republican politics.
But Republicans have other important priorities that require continued electoral victories, not “cashing in” political capital for tax cuts. Cultural conservatives care a lot more about yet-to-be-achieved immigration policy changes, yet-to-be-enacted bans on funding for Planned Parenthood, and yet-to-materialize Supreme Court openings than about cutting corporate tax rates. State-level Republicans are battling to win midterm elections and position themselves for the next round of redistricting fights; a national party that’s more focused on using its power than in maintaining it could be a millstone. And anti-Trump Republicans concerned with the party’s long-term integrity can’t be happy that their members of Congress are devoting most of their time to working hand-in-glove with the 45th president to shovel money to Donald Trump’s billionaire peers.
It could be a good while before we can make a full political cost-benefit analysis of this tax bill. But the current atmosphere, replete with Republican senators pointing out huge problems with the bill and then pledging to vote for it anyway, suggests a congressional party that has decided nothing on earth is more important. Compounding the factual lies and fuzzy math and distortions of budget rules and phony economic estimates required to “get to yes,” the GOP is in danger of fooling itself into sacrificing an awful lot for tax cuts.