Will GOP gamble on tax-cut votes?
Republicans want to draw a line in the sand with President Barack Obama and the Democrats on taxes.
But the party is already squabbling internally with a question: How bold can they be?
Speaker John Boehner (R-Ohio) and top House Republicans are pushing an ambitious summer tax agenda, including a series of politically charged votes on everything from expiring Bush income tax rates to capital gains, while laying out a timeline for broader tax reform, according to several sources familiar with GOP planning.
House Republicans will then wrap all those legislative measures together into a single package, and ship it over to the Senate for action - or inaction, which is more likely with a Democratic Senate in no mood to approve a GOP proposal.
The House GOP leadership's strategy is to put every lawmaker in the House on the record voting on tax bills that would affect virtually every working American and businesses throughout the country.
But like everything with this Republican majority, no big decision comes easy.
There are already divisions within the House Republican Conference about how aggressive the party should be, and many conservatives believe the party should go for full-blown tax reform, which leaders think is unrealistic and risky.
Boehner and his top lieutenants think it's shrewd politics to get Democrats on the record voting for tax increases, all while providing the party with a hard-and-fast negotiating position for a lame-duck battle after Election Day over the slew of expiring tax provisions.
But Republican conservatives, especially among the restive freshman class, think Boehner and their leadership team are settling for half-measures. A large bloc of the House GOP conference wants Republican leadership and Ways and Means Committee Chairman Dave Camp (R-Mich.) to be bold - put forth a major rewrite of the Tax Code this year. Even if the proposal doesn't pass, it draws a sharp contrast with what Democrats want to do, conservatives say.
Any radical rewrite of the Tax Code carries big political risks for Boehner and his colleagues. Obama and the Democrats will pounce on any GOP effort to eliminate popular tax deductions or loopholes and use those attacks to paint Republicans as not ready for prime time, or certainly not ready to be handed control for the House, Senate and White House in November. Democrats and the White House are already pounding Republicans for offering cuts to food stamps and other federal programs for the poor in order to protect Pentagon spending.
But there's no guarantee that rank-and-file House Republicans will fall in line behind their leadership's more modest plans.
Mitt Romney, the presumptive GOP presidential nominee, supports an extension of the Bush tax cuts and wants to slash an additional 20 percent of individual rates, while reducing taxes on capital gains. Romney's plan - which has yet to be fleshed out beyond broad strokes - may be popular with the Republican base but also could be enormously expensive in terms of lost federal revenue. Romney would likely have to sign off on a House GOP plan before Boehner rolls it out, complicating the political calculus for the House leadership.
"There's just no easy answer here because Obama has no plan, Romney has no plan, the Senate doesn't even meet hardly, so we're left with do we do something bold and big and comprehensive and be left to be hung out to dry?" complained Rep. Devin Nunes (R-Calif.), a member of the Ways and Means Committee. "Or do you pass something that has no chance of passing [in the Senate] and you're left with 'Why did you do that?' There's not anything we can do that's any good."
A senior House Republican, speaking without attribution, put it just as bluntly - and showed the discord with leadership.
"I think it's going to be a realization that there's not a good middle ground. Either we're going to go big and bold and really engage in fundamental tax reform in the next Congress if we pull off the political trifecta, and anything in between you're going to hear some hew and cry from people who have their specific provision in the Tax Code - it's an all or none," the lawmaker said. "Either we're going to put our ships in the harbor and do the right thing for America and the economy and get pro-growth policies or not."
Democrats simply say Republicans are fundamentally miscalculating both their tax strategy and politics.
"There is nothing that has done more damage to the federal budget picture than cutting $2.3 trillion in [2001-03], and combining it with two wars, a million new veterans, 46,000 wounded, and telling the American people they need to sacrifice," said Rep. Richard Neal (D-Mass.), a senior member of the Ways and Means panel. "All of this is being done under the rubric of offering tax cuts to wealthy people, despite the overwhelming evidence that the tax cuts of 2001 and 2003 put us in the budget predicament we're in."
Either way, Republicans are proceeding, and the road begins in earnest this week. Over trail mix and sodas in House Majority Whip Kevin McCarthy's office Tuesday, Camp began preparing GOP members for the seemingly inevitable: A massive overhaul of the Tax Code simply isn't possible. Roughly 30 lawmakers attended the session, according to several who sat in on the briefing. Camp laid out in detail what provisions are expiring and what it would cost to extend them. Camp did not endorse a specific plan for pushing through a tax package this summer, lawmakers said.
GOP leaders are also urging lawmakers to avoid getting attached to loopholes in the code - they will be used as chits during the year-end dash to negotiate tax rates.
If Congress does not act before Dec. 31 ,the Bush tax cuts will expire, causing tax rates for individual Americans, investors and those with large estates to rise, in some cases dramatically. Obama has already come out with a call to limit the tax increases to high-income Americans, but Republicans don't want higher taxes on anyone, regardless of income.
While all this is going on behind the scenes, Republican leadership hasn't had a terribly busy week. The most notable votes this week have been to honor Jack Nicklaus and Mark Twain, although a highway funding extension is on tap for later in the week. And the GOP is pushing a 20 percent business tax cut - which the Senate won't take it, and Obama said he'd veto.