Wednesday, January 2, 2013

Cliff hangers: Taxes and the GOP’s long division


HAPPY NEW YEAR. We made it. And they did it. You can put the climactic clip from “Thelma & Louise” away. Retire the metaphors for precipitous experiences. We're fiscal cliff hangers no more. Last night, a majority of the members of the House of Representatives had the facts and they voted Yes.

At 10:57 p.m. Capitol Hill Time, the House passed HR 844, a measure that will permanently end the Bush-era tax cuts and raise taxes for individuals earning more than $400,000 a year and families earning more than $450,000; and extend federal unemployment benefits by a year. The vote wasn’t even close; HR 844 passed with 257 votes — 85 Republicans and 172 Democrats — when only 218 were needed.

In a Congress allergic to bipartisanship, the bill that just passed was an example of how it’s possible for legislation to piss off everyone. The bill was opposed by the AFL-CIO, the nation’s pre-eminent labor organization whose members were a lock for President Obama’s re-election, and the Heritage Foundation, the conservative think tank now run by arch-rightie Jim DeMint, the former senator. Both sides gave up something dear. Thus is the nature of negotiation, in Washington and everywhere else.

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Not long before taking Air Force One back to Hawaii to finish the vacation so rudely interrupted just after Christmas, President Obama underscored the importance of the bill’s passage with a visit to the Brady Briefing Room at the White House.

“Thanks to the votes of Democrats and Republicans in Congress, I will sign a law that raises taxes on the wealthiest 2 percent of Americans while preventing a middle class tax hike that could have sent the economy back into a recession and obviously had a severe impact on families all across America. ...

“Last year I signed into law $1.7 trillion in deficit reduction. Tonight's agreement further reduces the deficit by raising $620 billion in revenue from the wealthiest households in America. And there will be more deficit reduction as Congress decides what to do about the automatic spending cuts that we have now delayed for two months.”

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THE PRESIDENT made it clear that generating more revenue will be an administration objective in the future. “[W]e can't simply cut our way to prosperity. Cutting spending has to go hand in hand with further reforms to our tax code so that the wealthiest corporations and individuals can't take advantage of loopholes and deductions that aren't available to most Americans.”

The bill’s passage achieved other, less publicized objectives; its OK by the House means the estate tax threshold stays at $5 million; and it puts off debate over the “sequester,” or a series of automatic budget cuts that were the sticking point for House Republicans.

It makes fixes to the dreaded alternative minimum tax; it furthers the child tax credit for another five years; and the bill extends the farm bill for a year. No more threat of $8 gallons of milk until at least this time next year.

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House Speakerphone John Boehner was thoroughly boxed in and he knew it. Earlier in the day, after the Senate had approved the measure overwhelmingly, 89 to 8, the Speaker of the House decided on an action plan: Press to find whether there were 218 votes in the House to make amendments to the Senate-passed bill. If 218 votes couldn’t be found to support an amendment, Boehner would bite the bullet and call for a straight up-or-down vote on the measure. That’s what happened.

One reason it happened — clear now in retrospect — had to do with the enduring divisions within the House Republican conference and, more widely, the Republican Party itself. Those schisms were obvious last night. The antagonism between Boehner and House Majority Leader Eric Cantor, suspected or feared or hinted at before, was all too apparent with the vote tally. Cantor was expected to vote against it as it emerged from the Senate. He did, along with House Majority Whip Kevin McCarthy.

But in what could be the day’s biggest surprise, Boehner actually voted for the bill, along with the king of the budget wonks, Rep. Paul Ryan of Wisconsin. They voted for legislation that, within hours of passage in the House, was already being couched as a victory for the Obama White House, mentioned in news stories and blogposts with headlines juxtaposing the words “Republicans” and “Cave.”

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THE FACT of the opposing votes of leadership is bad enough for the GOP. What’s worse is what it clearly says about Republican unity. Simply put: There ain’t none. “I think there's some significant divisions within leadership as demonstrated on this vote,” GOP Rep. Tim Huelskamp of Kansas told The Huffington Post last night.

“I think there's a tremendous dissatisfaction within the caucus over what's occurred in the last two years -- so many missed opportunities,” Huelskemp said. “And now at the end of the day, after 25 years, we're going to abandon a clear Republican principled position against tax increases? You can spin it however you want to, but at the end of the day it's a tax increase.”

At the end of the day, that’s what rankles the hardest of the hard-core conservatives the most: being outmaneuvered, by Obama’s White House, economic reality and political practicality, and forced to do what they detest. Grover Norquist, the high priest of anti-tax zealots whose Taxpayer Protection Pledge amounts to being a conservative loyalty oath, was a huge loser last night.

So was any notion of Republican unity. With sniping over the resolution of the “fiscal cliff” crisis coming from everyone from Newt Gingrich (who tweeted that “the gop has been engaged in a two-month dance of defeat and surrender!”) to publicity enthusiast Donald Trump (who tweeted that “the Republicans may be the worst negotiators in history!”), it’s clear the political role of circular firing squad, once an albatross of the Democratic identity, is now well occupied by the GOP.


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The idea of inevitable interparty gridlock died a little death too. On MSNBC last night, E.J. Dionne of The Washington Post laid out a road map for a possible legislative future, one whose contours were suggested by the House vote.

“You had a coalition of 85 Republicans and 172 Democrats who passed this thing. What [they] did is essentially isolate the most conservative Republicans in Congress.

“In order to govern over the next two years, you’re gonna have to see coalitions like you had tonight, and it’s really significant that Speaker Boehner, in the end, after allowing the rebellion to have some voice, giving the Republicans time to come to terms with the fact that they were essentially going to lose on this one … had to bring this to the floor.”

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FOR PRESIDENT Obama, it was a decided win even with the complaints of some liberals, who thought Obama gave away too much with the shift of the tax-cut baseline tripwire from $250,000 (a campaign promise) to the current $400,000. “Giving in on the income and losing some of that revenue — yeah, that was a significant concession,” Dionne said on MSNBC. “But the fact is, a lot of Democrats from affluent states and affluent districts actually wanted that number to go up a little bit, and there are quite a few Democrats who represent more affluent areas.”

All in all, a good way to start the year, and the obvious scene-setter for what may come next: A gridlock saga in three parts.

Congress will begin wrangling over the $16.4 trillion debt ceiling sometime in early March, along with the sequester whose proposed budget cuts mean pain for everyone (but not equally), and the matter of the continuing budget resolution, which expires on March 27. If Congress doesn’t approve a new one by then, we’re faced with a shutdown of the federal government. Stop me if you’ve heard that one before.

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But the president, warming to his renewed role as badass-in-chief, laid down a marker on Tuesday, warning the GOP against using the debt ceiling as a way to hold the good faith & credit of the United States hostage to partisan interests.

“While I will negotiate over many things, I will not have another debate with this Congress over whether or not they should pay the bills that they've already racked up through the laws that they passed,” he said.


“Let me repeat: We can't not pay bills that we've already incurred. If Congress refuses to give the United States government the ability to pay these bills on time, the consequences for the entire global economy would be catastrophic, far worse than the impact of a fiscal cliff.

“People will remember back in 2011, the last time this course of action was threatened, our entire recovery was put at risk. Consumer confidence plunged, business investment plunged, growth dropped. We can't go down that path again.”

It’s already shaping to be a good year for mo’ drama on Capitol Hill. We’ve ended one cliffhanger and the stage is set for at least a couple more — one of them being the outcome of the clash of titans inside the Republican House. One will rise, one will rule. When the 113th Congress begins tomorrow, which Republican Party will be in charge?

We may need to keep “Thelma & Louise” around after all.

Image credits: House vote: C-SPAN. Obama: MSNBC. Boehner and Mitch McConnell: via gopleader.gov. The scene: “Thelma & Louise,” © 1991 Metro-Goldwyn-Mayer.

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