It may seem ironic that one of the most powerful staffers on big money issues on Capitol Hill has passed up a far more lucrative career on K Street.
But Mark Prater, the Senate Finance Committee’s top Republican tax lawyer, shrugs and gives a wry chuckle when asked why he never cashed out.
“I love this job. It’s a great job ... [with] great people,” the self-effacing Prater said in an interview. “It’s a big privilege.”
And while he's given up the potential for a big payday, he's gained something else: The chance to do a major rewrite of the tax law, which hasn't been accomplished since 1986.
“Let’s put it this way, when it comes to tax policy on anything the Finance Committee does, he is the real kingmaker,” said former Senate Finance Chairman Charles E. Grassley, R-Iowa. Prater — who has had a hand in every major tax bill since 1990 — has gained a reputation on both sides of the aisle as a good-natured mentor, a straight shooter and a master of tax law.
Incoming Senate Finance Chairman Orrin G. Hatch, R-Utah, heaped praise on Prater, and noted, “He also works very well with Democrats. They rely on what he says as well, and they should. He’s just that good.”
Current Senate Finance Chairman Ron Wyden, D-Ore., praised him in an email. "Mark Prater has been a steadfast partner for members of the Finance Committee on both sides of the aisle as we tackle some of the most pressing issues affecting Americans today. I am also proud to call him a fellow Oregonian. Mark’s hard work and thoughtful approach to policymaking represent the gold standard of public service.”
Looking ahead, Prater believes the next few months will be crucial in determining what Congress can do on a tax overhaul. With the threat of 2016 politics creeping into the narrative later in the year, returning to a robust committee process that has recently suffered could go a long way toward garnering buy-in from members.
It’s time to “find the support and the bipartisan consensus,” Prater said. “Hatch wants to ... find the path.”
Looking back, Prater listed several tax bills among his career highlights, including the 1997 Taxpayer Relief Act that established Roth IRAs and lowered capital gains rates to 20 percent.
“It was a good example of the Congress working together with the president,” Prater said, adding that the framework for the bill was crafted in the Clinton White House and the measure was fleshed out in Congress.
But Rohit Kumar, a former key staffer for Republican leader Mitch McConnell, R-Ky., believes Prater’s skill is best demonstrated by a two-year period in 2003 and 2004. Congress passed a partisan tax cut in 2003 that cut the capital gains and dividend tax rate to 15 percent, and then in 2004 passed the bipartisan American Jobs Creation Act.
“That two-year period encapsulated the full range of Mark Prater’s skills and abilities; from getting a partisan bill through the Senate and to the president's desk all the way to a bipartisan, compromise bill that got 60 votes and also made it to the president’s desk,” said Kumar, who is now at PWC.
The 2003 bill is most often remembered for just squeaking by in the Republican-led Senate, with a 50-50 tie vote that was broken by Vice President Dick Cheney.
Kumar said one aspect of the 2003 bill that often gets forgotten is the fact the Senate version eliminated the tax on capital gains and dividends, which had been a priority for President George W. Bush. It was a notable feat because Senate Republicans were using reconciliation to pass the tax bill with just a simple majority .
“Mark helped design a version of that that got to zero; it wasn’t permanent because you can’t do that in reconciliation, but a way to get to zero inside the revenue constraints that had been imposed on us,” Kumar said. “It was a work of art.”
The provision never became law because it was dropped in conference with the House. “But that in no way diminishes the maximum genius of Mark Prater,” Kumar said.
Russell W. Sullivan, a former Democratic staff director for the panel, recalled a time when House and Senate negotiators were stuck on a provision of the 2003 Medicare prescription drug bill.
Prater pulled Sullivan aside and together they brainstormed a solution to a complicated problem related to encouraging employers to continue their coverage. “With his intellectual power we came up with a solution that, when he laid it out, every member ... said, 'That’ll work,'” said Sullivan, now at McGuireWoods LLP.
That Prater was tapped to be the top staffer on the supercommittee, a.k.a. the Joint Select Committee on Deficit Reduction, also spoke to his stature in the chamber. The panel was established as part of the deal to raise the debt ceiling in 2011.
“He was the natural choice,” Kumar said. “My biggest fear wasn’t that he would say no, but that his wife was going to show up at my doorstep with a gun.”
“It was a heavy lift,” Kumar continued, noting that most top staffers were exhausted having just negotiated a deal to defuse the debt limit crisis. And now Prater was being asked to continue working.
Prater insisted that despite not achieving its goal, the work the supercommittee did was important and has ended up as offsets in other subsequent legislation.
A native of Portland, Ore., Prater practiced law there and believes there is an art to getting a tax deal done that centers on trust and communication.
“Politicians are no different than businesspeople,” Prater said. “People tend to make deals late because a lot of folks want perfect information; you don’t have perfect information until you’re facing a deadline.”
Prater noted that both “needs” and “wants” have to be accounted for. “All of this takes time and it’s a very delicate process."
He learned much about negotiating from watching his grandfather, who owned a general contracting business.
“He taught me a lot about business; about how you deal with people,” Prater said. “He’d say, ‘It all comes down to your word.'”
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