Senate Republicans Keep Eyes on Tax Prize

Distractions have not hindered work behind the scenes

Senate Majority Leader Mitch McConnell is taking a different approach to taxes than he did with health care. (Tom Williams/CQ Roll Call)
Senate Majority Leader Mitch McConnell is taking a different approach to taxes than he did with health care. (Tom Williams/CQ Roll Call)
Posted October 26, 2017 at 5:03am

Senate Republicans are keeping the wheels in motion in their effort to overhaul the U.S. tax code, despite a litany of distractions that threaten to derail it.

GOP members of the Finance Committee are meeting this week to discuss issues such as how to pay for the legislation, among other topics, according to a Republican source with knowledge of the panel’s plans.

Senate Majority Leader Mitch McConnell and Finance Chairman Orrin G. Hatch also hosted a meeting Tuesday of roughly a dozen Republican senators to provide a broad outline of the ongoing work by the Finance panel, according to lawmakers who attended.

The actions show the GOP might be taking to heart lessons from a previous debacle. During negotiations earlier this year on a measure to repeal the 2010 health care law, regular Senate policy luncheons turned into free-for-all discussions on health care, while McConnell kept the process under his control.

In the aftermath of that failure, several lawmakers and aides pointed to the “committee of the whole” process as one of the key reasons why it was not successful.

Hence the move to make the tax effort different.

Members of the Senate Finance Committee have taken more of an ownership role in the creation of the bill, receive regular briefings on key details as they are agreed to by congressional leaders and the administration, and have taken the lead on educating their colleagues on complex tax policy.

And while rank-and-file members have been kept largely in the dark on the legislation’s specific contents, GOP leaders are beginning to host smaller meetings to clue in non-Finance panel lawmakers about the emerging deal.

“Mitch has been determined to make sure that everybody who wants to have a say in this will have a say. When we are through, no one, no reasonable person, will be able to say, ‘No, they didn’t consider me,”’ Louisiana Sen. John Kennedy said.

Lobbyists loom

There is good reason for the more cautious approach. Republicans are plotting an aggressive timeline for their tax effort.

The House is expected to introduce a public draft of its legislation on Nov. 1, and a markup of that measure could come the following week, aides say.

The Senate Finance Committee is eyeing a markup of its version of the bill the week of Nov. 13, according to individuals with knowledge of the schedule.

“Chairman Hatch intends to lay down a mark for the committee to advance in the coming weeks. Details will be released when finalized,” a spokeswoman for the panel said.

Both chambers are hoping to pass their respective bills by the December recess at the latest.

Whether that can be achieved remains to be seen. While lawmakers say they feel more confident than ever, several admit that could change drastically once text of the bill is released and a torrential wave of lobbying from nearly every industry with a presence in Washington, D.C., begins.

“It’s going to take a lot of people holding hands together because the onslaught of special interests … is going to be massive,” Tennessee GOP Sen. Bob Corker said.

The unpredictability of President Donald Trump and lingering questions over what the administration actually wants to see in a bill could also add significant complications.

Other hiccups

There is no shortage of distractions that could hinder the work on the tax overhaul.

Arizona Republican Jeff Flake on Tuesday announced he would not seek re-election next year, with a blistering takedown of Trump on the Senate floor. Earlier in the day, Corker and Trump exchanged a series of back-and-forth jabs, the latest in an escalating feud.

Lawmakers said those events have no impact on the tax effort, and Corker himself said he remains confident Republicans can eventually pass a bill.

But there is still a long way to go before a measure reaches Trump’s desk.

Republicans are still grappling with how to pay for several major tax breaks. One of the biggest revenue raisers — eliminating the state and local tax, or SALT, deduction — continues to cause anxiety among House Republicans. One senator, speaking on background to discuss internal negotiations, said the chamber has all but accepted that removing the deduction entirely may not be possible.

That could be damaging news for members like Corker who have expressed serious reservations about any proposal that would add to the federal deficit. That benchmark becomes more difficult to meet if the SALT deduction — which, by some estimates, could generate about $1.3 trillion in revenue — is not scrapped.

Intraparty tensions could also boil over once the full bill is released. While GOP leaders have shared some details with the broader conference, much of the legislation remains secret. And once a full bill is released, Republicans will be under immense time pressure to analyze it and obtain input from key stakeholders.

“There’s still a lot of questions on the small details,” Sen. James Lankford of Oklahoma said, adding that he thinks the timeline will be tighter on the Senate side than the House.

Still, Republicans think their desire for a tax overhaul will be the uniting force to help drive a bill forward.

“Bottom line: We have to look at what is good for the American people and I think tax reform is quite good for the American people,” Iowa Sen. Joni Ernst said.

And members briefed on the effort say they were pleased with the outline thus far.

“There’ll be some cheesecake and some spinach,” Kennedy said.