Grover Norquist still looms over house Republicans


Andrew Sullivan really is a conservative because he has the same conservative blinders many other right of center folks do. He disagrees with Johnathan Chait’s astute observation that it’s foolish to actual not push the Republicans towards the cliff because they will never vote for Clinton era tax rates:

The fiscal scolds cling to this because the tax reform alchemy is the whole thing that makes their plan appear to work. That’s why the Peterson network proclaims that lower tax rates are a key principle for tax reform – they think this will produce Republican votes for more revenue, even though it won’t. The only way to get Republicans to agree to higher revenue was to maneuver them into a situation where they had no choice — which is what is happening now.

The trouble with this analysis, it seems to me, and with the Obama administration’s current bargaining position, is that Speaker Boehner has already conceded that he is prepared to raise revenues. So I don’t see why Chait is insisting he hasn’t.

source: Cliff Notes, Ctd. – The Dish | By Andrew Sullivan – The Daily Beast.

Chait is insisting he hasn’t because Boehner and all Republicans haven’t moved from their pre-election position which is to A. leave tax rates the same and B. close loopholes as the only way to get tax revenue increases C. pray to free market messiah to create jobs and make us all house flippers again:

WALLACE: You’ve talked about the fact that the president won and you came out with a concession the day after the election. They point out that the president campaigned on raising tax rates, you know, and it was the big issue, between him and Romney. And, they say, just as he had to cave, after your victory in the 2010 midterms, now, it’s your turn to cave on tax rates.

BOEHNER: Listen, what is this difference where the money comes from? We put $800 billion worth of revenue, which is what he’s asking for, out of eliminating the top two tax rates.

But, here’s the problem, Chris, when you go and increase tax rates, you make it more difficult for our economy to grow. Half of that income is the small business income. It’s going to get taxed at a higher rate. And as a result, we’re going to see slower economic growth.

We’re not going to be able to cut our way out of this problem, nor can we can just grow our way out of the problem. We have to have a balanced approach.

But what the president wants to do will slow or economy at a time when he says he wants the economy to grow and create jobs.

WALLACE: Well, the White House says that while you have given this kind of talk, about, well, let’s close loopholes, let’s limit deductions, you haven’t offered any specifics, have you.

BOEHNER: We have laid it all out for them, a dozen different ways you can raise the revenue from the richest Americans, as the president would describe them, without raising tax rates.

WALLACE: What’s the biggest proposal you put on the table since the election in terms of raising revenue from closing loopholes and deductions?

BOEHNER: Well, you can cap — there are a lot of different ways to get there. But you can cap deductions at a percent of income. It’d be one way to get there. You can eliminate certain deductions for those — the wealthiest in our country. You could do all of that.

WALLACE: Let me ask you a couple of specifics, would you eliminate or lower the home mortgage deduction?

BOEHNER: Listen, there are lots of ways to get out there. Now, I’m not going to debate his or negotiate with you. But if you can sign the bill into law, I’d be happy to.

WALLACE: We’re trying to get those powers, but we haven’t yet.

BOEHNER: I understand.

WALLACE: Charitable deductions, would you be willing — I mean, you are a big charity guy.

BOEHNER: Listen, the president has seen a lot of the options from us. There are a lot of them put on the table, and I’m hopeful that the conversations will continue.

WALLACE: OK. But, let’s talk about your proposal, because, the president — and I’m sure this has driven you nuts — likes to say, the math tends not to work.

Let’s look at your math. The White House says a realistic cap — and I’ll explain what that means — of $25,000 on people making more than $250,000, a cap on their deductions, you can only take $25,000 in itemized deductions and exempting things like charitable deduction, which is pretty unlikely that you’re going to do away with that, would only bring in $450 billion, not the $800 billion you are talking about, not the trillion — $450 billion.

They say the math tends not to work.

BOEHNER: No, the White House knows that the math will work — to put the kind of revenue on the table that we’ve been talking about. It won’t work if we’re trying to get the $1.6 trillion. I’ll guarantee you that.

But you can put — we’ve put the revenue on the table. And, again a dozen different ways to get there without raising tax rates.

All analysis shows this inane tax loophole freeze tag won’t raise anywhere near enough revenue to start paying down the national debt or even bridge the yearly budget deficit so Chait is insisting Boehner hasn’t offered to raise revenue because what Boehner has trotted out as revenue increases to satisfy won’t be enough.

And Boehner pretends that Obama pulled 1.6 trillion over 6 years out of his ass after he ate the old proposal for thanksgiving instead of Cobbler and Gobbler. It’s the revenue that repealing the Bush tax cuts, raising estate taxes and limiting deductions for the wealthiest Americans will produce. It is the proposal Obama ran on and it’s on the record: (last updated October 25 2012 by the Tax Policy Center):

Relative to that baseline, the president’s proposals would raise an additional $1.7 trillion in revenue (net of outlays for refundable credits) over the coming decade.

That revenue gain is composed of two kinds of tax change: about $400 billion in revenue lost to a variety of tax reductions and $2.1 trillion in added revenue from tax increases (table 2). About $160 billion of the tax cuts would result from making permanent provisions in the 2009 stimulus act mostly for low- and middle-income households and another $160 billion would be due to various business tax cuts.

The remaining $100 billion of cuts would fund, among other things, the last three months of the 2012 payroll tax reduction and extension of various expiring provisions. On the revenue-increase side, about 40 percent of additional revenues would result from not extending the 2001-03 tax cuts for highincome households, about 28 percent from limiting the value of itemized deductions to 28 percent (affecting only high-income taxpayers), about 18 percent from various income tax increases on businesses, and the balance from miscellaneous tax increases.

In fact save for a few Republicans, they’ve had a big kabuki show of saying “I don’t care about Grover” but they are only signaling smaller tax loophole grab bag in place of the bigger tax loophole grab bag as the only revenue adjustments they are willing to undergo. This is their position since prior to November 6th 2012. Here is Boehner on October 12, 2012:

That requires reform of both the tax code and the way the federal government spends taxpayers’ money. Instead of raising tax rates on small businesses, we need an overhaul of the tax code that supports growth by closing loopholes and lowering taxes instead of raising them.

Here’s what you need to know: Grover still runs them. The GOP house caucus is still united behind not raising marginal tax rates for the wealthiest Americans. Grover’s not gone, he’s closer than ever.

The Republicans will let the new year come and then they can vote for Obama’s middle class tax cut on it’s own under the guise that they couldn’t bear to see middle class people suffer under Obama tax tyranny. Until then, they can’t.

The best thing about all this, they had a great deal (for Republicans) when the grand bargain was on the table as it only asked for 800b in additional revenue. Obama really was ready to give them a very Republican leaning deal and they balked at it, now they have no leverage.