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Obama Solidifies GOP’s Tax Doubts

Tom Williams/CQ Roll Call File Photo
Speaker John Boehner and House Majority Leader Eric Cantor think the gulf was too wide between the parties to negotiate a tax reform deal.

It might have been a long shot anyway, but Monday’s forceful deficit reduction speech by President Barack Obama — including a veto threat — is contributing to pessimism among Republicans about the Joint Committee on Deficit Reduction’s ability to address tax reform.

Obama is “undermining the work” of the panel, Co-Chairman Jeb Hensarling (R-Texas) said.

Speaker John Boehner (R-Ohio) said the speech was “not leadership. ... The president has not made a serious contribution to” the panel’s work.

Republicans say the speech bolsters the arguments of top Republicans that negotiating a tax reform deal with Obama is fraught with peril.

Hours after Boehner urged the deficit panel to “lay the groundwork” for tax reform in a speech at the Economic Club of Washington on Thursday, House Majority Leader Eric Cantor went the other way. In remarks to Politico, the Virginia Republican said that while “all of us would like to see tax reform,” he thought the gulf was too wide between the parties to accomplish it.

And Obama’s speech has polarized the issue even further, Republicans say.

The speech “means tax reform is officially off the table until after the 2012 elections,” said Grover Norquist, president of Americans for Tax Reform.

“If the super committee is considering fundamental tax reform in its short lifetime, I’m sure the president’s proposal has already been shelved given its blatant political purpose,” said Rep. Kevin Brady (R-Texas), a senior House Ways and Means Committee member.

A senior GOP aide explained that Republicans are for tax reform, just not the kind Obama would agree to.

“I think everyone on our side would like to see it, as long as it’s good. Otherwise, many folks, including leadership and Chairman Camp, feel that it’s better to do no tax reform than to do bad tax reform,” the source said.

A spokeswoman for Ways and Means Chairman Dave Camp, a super committee member, said the Michigan Republican was “in complete agreement with the Speaker and the leader about the need for comprehensive tax reform that creates a climate for job creation.”

Some Republicans are also voicing concern about the political fallout if they walk away from tax reform efforts.

“It makes sense to stake a claim on tax reform rather than let Obama own the issue,” a second GOP House aide said.

The political reasons for publicly backing tax reform help explain why the issue has maintained currency despite the odds it faces to make it onto the deficit panel’s docket.

Ken Kies, managing director at Federal Policy Group, noted the 1986 tax reform bill took nearly three years to shape.

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