Thursday, November 30, 2017 9:43:59 PM
Adding deficit 'trigger' to Senate tax plan raises new hurdle
"Brent Budowsky: Tax cut warning to GOP"
I wondered what exactly was the problem with the trigger. Have a better idea now.
Sen. Jeff Flake wouldn’t say whether he’d still back the overall tax plan without the trigger, but predicted, “I think it will be structured so it won’t” be in violation.
| Drew Angerer/Getty Images
By BRIAN FALER
11/30/2017 10:28 AM EST
Updated 11/30/2017 01:32 PM EST
A bid by Republican leaders to get deficit-minded senators fully on board their tax overhaul may be on a collision course with Senate rules, which could tank efforts to quickly muscle the legislation through the chamber.
Sens. Bob Corker of Tennessee, Jeff Flake of Arizona, and others are demanding lawmakers include a trigger mechanism in the plan that would impose automatic tax increases if their tax cuts don’t jog the economy as much as they hope. It’s emerged as perhaps the biggest issue standing in the way of the swift vote on the tax plan that leadership hopes for Thursday or Friday.
Republicans can only afford to lose two votes.
But it’s unclear whether such a provision is allowed under the chamber’s rules that will be part of the “reconciliation” process Republicans are using to jam their plan through the Senate. Lawmakers have been litigating the issue behind closed doors with the chamber’s parliamentarian, Elizabeth MacDonough, who interprets the rules.
If she decides the trigger idea would violate the rules, it could be struck down on the Senate floor — raising questions about whether a band of deficit hawks would abandon their party’s tax-rewrite plan.
If the past is any guide, Republicans may be headed for trouble. They failed in efforts to use a similar backstop as part of the first round of tax cuts when George W. Bush was president.
Flake acknowledged there’s a risk the current trigger could flunk the test.
“Yep — there is some concern,” he said. “It’s a challenge” making it fit within the rules.
He wouldn’t say whether he’d still back the overall tax plan, H.R. 1 (115), without the trigger, but predicted, “I think it will be structured so it won’t” be in violation.
Asked about the possibility of violating the rule, Corker said: “I don’t think it does, but if it does, we have a solution.”
He declined to discuss specifics, saying, “I can’t talk about it — if I start talking about it, it will be picked to pieces.”
Senate Budget Chairman Mike Enzi, of Wyoming, declined to comment, saying he didn’t want to be seen as publicly lobbying the parliamentarian.
“It’s a parliamentary issue and I’m not going to put anything out there that makes it sound like I’m trying to tell the parliamentarian what to do,” he said.
Republicans may also have to drop provisions allowing drilling in the Arctic National Wildlife Refuge — important to Sen. Lisa Murkowski, of Alaska, a key swing vote on taxes — though aides said that it still being debated.
They’ve tried, unsuccessfully, to use a similar mechanism before, when they were debating Bush’s 2001 tax cuts. At the time, some Republican senators wanted a trigger that would stop his tax cuts if projected budget surpluses didn’t materialize.
But they were forced to abandon the idea because they couldn’t figure out a way to make it fit the same rules now bollixing Republicans, said Bill Hoagland, who was a top Republican budget aide in the Senate at the time.
He and other outside budget experts say Corker’s proposal could meet a similar fate.
“Maybe there’s a clever way of getting around it, but I don’t know how,” said Hoagland, who added that he’s sympathetic to Corker’s trigger idea.
The problem is what’s known as the Byrd rule, named after the late Sen. Robert Byrd. It severely restricts what sort of provisions may be included in reconciliation measures.
Money
GOP places risky bet on trickle-down tax cut
By BEN WHITE
https://www.politico.com/story/2017/11/30/republicans-trickle-down-tax-cut-196333
The rule is complicated and persnickety, and one of its strictures bars provisions that don’t have a major impact on the budget. An arcane question now before lawmakers is whether Corker’s trigger would meet that standard.
[ Insert: SUMMARY OF THE BYRD RULE
http://archives.democrats.rules.house.gov/archives/byrd_rule.htm ]
Republicans say it would because it could force tax increases. But Hoagland says it’s impossible to know, at least at the moment, whether those tax increases will ever happen, so lawmakers can’t know whether their trigger will affect the budget.
“Yes, if the trigger is pulled in the future, obviously it would have a budgetary consequence,” he said. “But you don’t know if that trigger is ever going to be pulled.”
“Does it have a consequence today? No,” he said.
One way around the rules, said Hoagland, would be to drop the trigger, and pencil in future tax increases with the promise that Congress will undo them later, before they can take effect.
That’s what Corker is now considering as a fallback plan in case he can’t get his trigger idea past the parliamentarian, said Senate Majority Whip John Cornyn.
“They’ve got a fallback position that wouldn’t involve a trigger — it would involve an increase in the [corporate] rate in the out-years,” he said. The details are still being negotiated, but Cornyn said it could involve a half-percentage point increase in the corporate rate “in year six” of the plan.
That would be controversial, especially with the business community, because it would raise questions about whether lawmakers would really be able to agree to shut them off.
Cornyn said he wasn't thrilled with the idea either, but suggested it may be necessary.
“I don’t really like it, but you know, we’ve got 52 senators and we need 50 votes, so we’re going to have to work with everybody,” he said.
It’s also possible that if the parliamentarian rules against the trigger, she could be overruled by lawmakers, though that would be highly unusual.
Said Pete Davis, a former Republican budget aide: “I guarantee you they’re working like crazy” to come up “with a parliamentarian ruling that the trigger will pass Byrd-rule muster.”
https://www.politico.com/story/2017/11/30/republican-senate-tax-plan-trigger-270509
---
November 30, 2017 / 10:07 PM / Updated 2 hours ago
Senate tax bill stumbles on deficit-focused 'trigger'
Susan Cornwell, Amanda Becker
]...]
JCT had earlier estimated the tax bill would balloon the $20 trillion national debt by $1.4 trillion over 10 years. The new estimate, counting “dynamic”
economic effects, put the deficit expansion at $1 trillion, far short of assertions by some Republicans that the tax cuts would pay for themselves.
‘FAIRY DUST’
House of Representatives Democratic leader Nancy Pelosi said the new JCT estimate showed
“no amount of dynamic scoring fairy dust will fix the catastrophic deficits of the GOP tax scam.”
https://www.reuters.com/article/us-usa-tax/senate-tax-bill-stumbles-on-deficit-focused-trigger-idUSKBN1DU1DS
"Brent Budowsky: Tax cut warning to GOP"
I wondered what exactly was the problem with the trigger. Have a better idea now.
Sen. Jeff Flake wouldn’t say whether he’d still back the overall tax plan without the trigger, but predicted, “I think it will be structured so it won’t” be in violation.
| Drew Angerer/Getty Images
By BRIAN FALER
11/30/2017 10:28 AM EST
Updated 11/30/2017 01:32 PM EST
A bid by Republican leaders to get deficit-minded senators fully on board their tax overhaul may be on a collision course with Senate rules, which could tank efforts to quickly muscle the legislation through the chamber.
Sens. Bob Corker of Tennessee, Jeff Flake of Arizona, and others are demanding lawmakers include a trigger mechanism in the plan that would impose automatic tax increases if their tax cuts don’t jog the economy as much as they hope. It’s emerged as perhaps the biggest issue standing in the way of the swift vote on the tax plan that leadership hopes for Thursday or Friday.
Republicans can only afford to lose two votes.
But it’s unclear whether such a provision is allowed under the chamber’s rules that will be part of the “reconciliation” process Republicans are using to jam their plan through the Senate. Lawmakers have been litigating the issue behind closed doors with the chamber’s parliamentarian, Elizabeth MacDonough, who interprets the rules.
If she decides the trigger idea would violate the rules, it could be struck down on the Senate floor — raising questions about whether a band of deficit hawks would abandon their party’s tax-rewrite plan.
If the past is any guide, Republicans may be headed for trouble. They failed in efforts to use a similar backstop as part of the first round of tax cuts when George W. Bush was president.
Flake acknowledged there’s a risk the current trigger could flunk the test.
“Yep — there is some concern,” he said. “It’s a challenge” making it fit within the rules.
He wouldn’t say whether he’d still back the overall tax plan, H.R. 1 (115), without the trigger, but predicted, “I think it will be structured so it won’t” be in violation.
Asked about the possibility of violating the rule, Corker said: “I don’t think it does, but if it does, we have a solution.”
He declined to discuss specifics, saying, “I can’t talk about it — if I start talking about it, it will be picked to pieces.”
Senate Budget Chairman Mike Enzi, of Wyoming, declined to comment, saying he didn’t want to be seen as publicly lobbying the parliamentarian.
“It’s a parliamentary issue and I’m not going to put anything out there that makes it sound like I’m trying to tell the parliamentarian what to do,” he said.
Republicans may also have to drop provisions allowing drilling in the Arctic National Wildlife Refuge — important to Sen. Lisa Murkowski, of Alaska, a key swing vote on taxes — though aides said that it still being debated.
They’ve tried, unsuccessfully, to use a similar mechanism before, when they were debating Bush’s 2001 tax cuts. At the time, some Republican senators wanted a trigger that would stop his tax cuts if projected budget surpluses didn’t materialize.
But they were forced to abandon the idea because they couldn’t figure out a way to make it fit the same rules now bollixing Republicans, said Bill Hoagland, who was a top Republican budget aide in the Senate at the time.
He and other outside budget experts say Corker’s proposal could meet a similar fate.
“Maybe there’s a clever way of getting around it, but I don’t know how,” said Hoagland, who added that he’s sympathetic to Corker’s trigger idea.
The problem is what’s known as the Byrd rule, named after the late Sen. Robert Byrd. It severely restricts what sort of provisions may be included in reconciliation measures.
Money
GOP places risky bet on trickle-down tax cut
By BEN WHITE
https://www.politico.com/story/2017/11/30/republicans-trickle-down-tax-cut-196333
The rule is complicated and persnickety, and one of its strictures bars provisions that don’t have a major impact on the budget. An arcane question now before lawmakers is whether Corker’s trigger would meet that standard.
[ Insert: SUMMARY OF THE BYRD RULE
http://archives.democrats.rules.house.gov/archives/byrd_rule.htm ]
Republicans say it would because it could force tax increases. But Hoagland says it’s impossible to know, at least at the moment, whether those tax increases will ever happen, so lawmakers can’t know whether their trigger will affect the budget.
“Yes, if the trigger is pulled in the future, obviously it would have a budgetary consequence,” he said. “But you don’t know if that trigger is ever going to be pulled.”
“Does it have a consequence today? No,” he said.
One way around the rules, said Hoagland, would be to drop the trigger, and pencil in future tax increases with the promise that Congress will undo them later, before they can take effect.
That’s what Corker is now considering as a fallback plan in case he can’t get his trigger idea past the parliamentarian, said Senate Majority Whip John Cornyn.
“They’ve got a fallback position that wouldn’t involve a trigger — it would involve an increase in the [corporate] rate in the out-years,” he said. The details are still being negotiated, but Cornyn said it could involve a half-percentage point increase in the corporate rate “in year six” of the plan.
That would be controversial, especially with the business community, because it would raise questions about whether lawmakers would really be able to agree to shut them off.
Cornyn said he wasn't thrilled with the idea either, but suggested it may be necessary.
“I don’t really like it, but you know, we’ve got 52 senators and we need 50 votes, so we’re going to have to work with everybody,” he said.
It’s also possible that if the parliamentarian rules against the trigger, she could be overruled by lawmakers, though that would be highly unusual.
Said Pete Davis, a former Republican budget aide: “I guarantee you they’re working like crazy” to come up “with a parliamentarian ruling that the trigger will pass Byrd-rule muster.”
https://www.politico.com/story/2017/11/30/republican-senate-tax-plan-trigger-270509
---
November 30, 2017 / 10:07 PM / Updated 2 hours ago
Senate tax bill stumbles on deficit-focused 'trigger'
Susan Cornwell, Amanda Becker
]...]
JCT had earlier estimated the tax bill would balloon the $20 trillion national debt by $1.4 trillion over 10 years. The new estimate, counting “dynamic”
economic effects, put the deficit expansion at $1 trillion, far short of assertions by some Republicans that the tax cuts would pay for themselves.
‘FAIRY DUST’
House of Representatives Democratic leader Nancy Pelosi said the new JCT estimate showed
“no amount of dynamic scoring fairy dust will fix the catastrophic deficits of the GOP tax scam.”
https://www.reuters.com/article/us-usa-tax/senate-tax-bill-stumbles-on-deficit-focused-trigger-idUSKBN1DU1DS
It was Plato who said, “He, O men, is the wisest, who like Socrates, knows that his wisdom is in truth worth nothing”
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