Congress
‘Be careful about this’: Warnings abound as GOP considers writing off tax cuts
It’s the accounting maneuver that could break the Senate, upend the federal budget process and explode the national debt.
That’s according to critics of a fiscal tactic that congressional Republicans are now seriously considering as they struggle to figure out how to deliver on all of President Donald Trump’s policy demands.
Adopting the “current policy baseline,” as it’s called, could be the only way for the GOP to make Trump’s 2017 tax cuts permanent and avoid painful cuts to federal programs, as well as pile on new income tax exemptions for tips, overtime and Social Security. Trump is expected to discuss the move with members of the tax-writing Senate Finance Committee at a White House meeting Thursday.
If lawmakers adopt the change, it would essentially make it appear as though extending current tax rates, set to expire at the end of the year, would cost nothing rather than the roughly $4 trillion over 10 years that nonpartisan scorekeepers estimate.
But while some Republicans argue that continuing current tax rates shouldn’t be counted toward the deficit, critics of the maneuver — including prominent GOP budget experts — say that it would be a recipe for disaster, a fiscal Pandora’s box that once opened could be used to forever excuse huge ongoing deficits.
“I would caution my friends, my Republican friends and senators up there, be careful about this,” said Bill Hoagland, the former GOP staff director for the Senate Budget Committee. “Someday you may be in the minority.”
The tactic is so tempting because it would solve a very difficult political problem for Republicans. Budget hawks in the House who do not want the party-line domestic policy bill adding to federal deficits want to ensure that planned tax cuts are closely tied to the amount of spending cuts Republicans can achieve.
Even then, the $4.5 trillion upper limit the House put on tax cuts does not leave enough room for a permanent extension of expiring tax cuts, in addition to all the other tax-related asks Trump has made.
For instance, adding on Trump’s other tax-related asks, such as income tax exemptions for overtime, tips and Social Security benefits, could add up to another $5 trillion, according to the nonpartisan Committee for a Responsible Federal Budget.
Critics say members of either party could use the maneuver to disguise trillions of spending through tax policies. Democrats argue that if Republicans move forward, they would be doing away with decades of precedent — and reneging on decades of anti-deficit rhetoric — to enact tax cuts for the wealthy.
Massachusetts Sen. Elizabeth Warren called it “magic math” in an interview and said going in that direction would end the congressional budget process as it has existed for more than 50 years.
“They can’t repeal the underlying reality, a $4.7 trillion giveaway to billionaires and giant corporations will cost $4.7 trillion,” she said, referring to how much the tax cut extensions are estimated to cost with interest.
Said Sen. Mark Warner (D-Va.), who signed onto a recent letter with Warren questioning the GOP’s strategy, “If this was done in the accounting world, you wouldn’t be an accountant for very long.”
Meanwhile, the leading advocate of moving to a current policy baseline, Senate Finance Chair Mike Crapo (R-Idaho), argued that it would rectify budget scoring rules that favor higher spending over keeping taxes low.
“If you’re not changing the tax code, you’re simply extending current policy, you are not increasing the deficit,” Crapo said on Fox Business in January. “We’ve got to get some kind of sensibility into the way that we score.”
Sen. John Kennedy (R-La.), a Budget Committee member, brushed off the idea that Republicans were undermining the budget procedures in place since 1974 — but also acknowledged that turnabout could be fair play when Democrats get their next governing trifecta.
“They will probably use current policy themselves in the future when they’re back in the majority,” he said.
Besides being controversial from an accounting perspective, the current policy baseline represents a major political gamble for Republicans, with the fate of potentially all of Trump’s tax agenda hanging in the balance.
That’s because the GOP might not know for weeks, if not months, if the maneuver will pass muster with the Senate’s parliamentarian. With a permanent extension of the expiring tax cuts moving toward the center of the Republican must-do list, an adverse ruling could create a huge hole in the GOP’s math.
“It would complicate making the tax cuts permanent,” said Sen. Lindsey Graham (R-S.C.), who chairs the Budget Committee.
That could create pressure for Republicans to overrule or even fire the parliamentarian — a move that would upend the delicate balance senators of both parties have adhered to for decades: Only bills that comply with strict fiscal rules aimed at reducing deficits can be exempted from the chamber’s 60-vote requirement for ending debate and moving to a final vote.
“As far as I’m concerned, that might as well give away the filibuster in the Senate,” Hoagland said.
Republicans, for their part, say they aren’t doing anything out of compliance with the longstanding budget rules. And there’s widespread skepticism inside the Senate GOP that they would ever vote to overrule the longtime parliamentarian, Elizabeth MacDonough.
We can say “it’s a $4 trillion deficit that we’re going to add into this, or we can say it’s current policy, but everyone knows it’s the exact same the next day,” said Sen. James Lankford (R-Okla.) in an interview. “So it’s nomenclature.”
Key GOP staff are already quietly meeting with the parliamentarian to try to get informal vibe checks on what she is thinking. Though senators won’t get a formal ruling until they go through what’s called a “Byrd bath” — when the reconciliation bill is vetted to make sure it complies with the rules that allow them to pass it by a simple majority — they can and frequently do have conversations with the parliamentarian’s office before that as they try to game out their procedural strategy.
“We think the law is pretty clear … but these things are all subject to discussion and arguments made in front of the parliamentarian,” Senate Majority Leader John Thune said in a brief interview, while cautioning that they were a long way away from that point.
But there’s skepticism from former longtime congressional staff and budget experts that the Senate GOP plan will fall within the rules of reconciliation. Sen. Jeff Merkley (D-Ore.), the top Democrat on the Budget Committee, predicted the parliamentarian won’t green-light the GOP strategy because it “seems like a pretty big stretch” of the rules.
George Callas of Arnold Ventures, who served as former Speaker Paul Ryan’s top tax aide during the drafting of the 2017 law, said adopting the current policy baseline would amount to a “huge gimmick.”
“My understanding is that the Senate parliamentarian gives a great deal of weight to the existing rules and the precedents and takes a skeptical look at just expedient reinterpretations of those rules for political reasons,” he said.
Senate Republicans are facing a put up or shut up moment to move ahead with a party-line bill this week.
Those who want to advance a budget blueprint now will use Tuesday’s GOP closed-door lunch as a last-ditch effort to rally their colleagues behind what’s guaranteed to be a politically heavy lift. But prospects are waning with each passing hour, as lawmakers face a slew of other priorities, including plotting the path for a stopgap funding patch.
Senate Majority Leader John Thune said Monday it’s possible members stay through the weekend or return next week to knock out lingering tasks, delaying the start of a five-week recess.
“It looks to me at least like there’s a good possibility that it’ll take us more than Thursday or Friday to get through the things we have to get through,” he told reporters.
Budget Republicans are meeting separately Tuesday morning to talk about advancing a framework in the Senate, but Chair Ron Johnson declined to say Monday whether he would release a budget resolution this week — a necessary step for the chamber to make any movement forward.
Johnson said he’s “working with leadership,” who he acknowledges has been prioritizing government funding.
Meanwhile, Sen. John Kennedy told reporters Monday he didn’t expect any budget resolutions on the floor this week because “I don’t think my leadership wants to do it.”
“As I’ve said before, you got to have the votes to get on it,” Thune said Monday, while stopping short of nixing the possibility of a vote this week.
Thune also may need to deal with GOP hard-liners demanding votes on the SAVE America Act as frustration percolates over whether the budget measure’s election provisions comply with Senate rules for the reconciliation process.
Sen. Roger Marshall joined Sen. Mike Lee Monday in saying the chamber shouldn’t depart without passing the elections bill, and Marshall said he’d be willing to object to adjourning the chamber over it.
What else we’re watching:
— BLANCHE HAS MORE REPUBLICANS TO CONVINCE: Todd Blanche’s prospects for confirmation as attorney general were much improved Monday — but he’s not in the clear yet. The acting attorney general secured votes from the previously reluctant Sens. John Cornyn and Thom Tillis over the weekend, all but certainly giving him the votes he needs to advance out of Judiciary Tuesday morning. But he still needs to get through the full Senate, where he can only lose two Republican votes given likely unified opposition from Senate Democrats and Sen. Mitch McConnell’s absence.
— GOP SENATORS BREAK SILENCE ON MILLER: Multiple Senate Republicans are calling for Rep. Max Miller to step down from office amid domestic abuse allegations. The outcry comes after Sen. Bernie Moreno — father of Miller’s ex-wife, Emily Moreno — said in a statement Sunday Miller should not serve in the House. Miller has denied the allegations. The surge of support from Moreno’s colleagues marks the first significant crack in a wall of GOP silence regarding the claims. Miller has until Wednesday to withdraw from the ballot and allow a crash primary to select a replacement.
Jordain Carney, Chris Marquette, Riley Rogerson and Mia McCarthy contributed to this report.
Senate Republicans are hopeful they will be able to confirm Todd Blanche as attorney general by the end of the week. But he’s not in the clear yet, as several undecided GOP senators continue to mull it over.
Blanche’s prospects were nonetheless much improved Monday — less than 24 hours after some GOP senators were predicting he was unlikely to get confirmed as a war of words escalated between President Donald Trump and holdout Republicans.
But then Blanche cut a deal with Sens. John Cornyn (R-Texas) and Thom Tillis (R-N.C.) late Sunday night to clarify a controversial settlement between Trump and the IRS, giving Blanche the votes he needed to get through the Judiciary Committee Tuesday.
He still needs to get through the full Senate, where he can only lose two Republican votes given likely unified opposition from Senate Democrats and Kentucky Sen. Mitch McConnell’s absence.
Several GOP senators who raised alarms last week about Trump’s public threats to rekindle the “Anti-Weaponization Fund” Cornyn and Tillis worked to kill declined to say Monday how they’d vote on Blanche.But in a positive sign for the acting attorney general, several are looking to Tillis and Cornyn, who are now supporting him, as a lodestar for their own deliberations ahead of likely floor votes later this week.
“I think certainly the fact that he has signed this order, basically disbanding [the fund] — that’s a pretty good step,” said Sen. Lisa Murkowski (R-Alaska), before adding that she would “like to find out a little bit more about the negotiations.”
Murkowski said she plans to speak with Tillis and Cornyn.
“I’m curious about what went on over the weekend,” she said.
Blanche has made efforts to ingratiate himself with Murkowski. In July, he trekked to Alaska, in part at Murkowski’s urging, to better understand public safety and tribal jurisdiction matters. He recently announced a nine-figure settlement benefiting Alaska natives’ health care that Murkowski was pleased with.
“I just appreciated the fact that he went to the state,” Murkowski said. “He was only there for two days, but I had asked him in my initial meeting to go up to the state.”
Sen. Bill Cassidy (R-La.), who like Cornyn lost his primary earlier this year to a Trump-backed challenger, declined to discuss Blanche Monday. Sen. Susan Collins (R-Maine) added that she also wanted to talk to Tillis and Cornyn and read the agreement they struck with Blanche.
“Until I do that, I am not going to make a judgement,” Collins said.
Another Republican who hasn’t yet committed to supporting Blanche is Sen. John Curtis (R-Utah). He met with Blanche last week but hasn’t yet weighed in since Sunday night’s agreement. He had indicated before Sunday’s deal that he would be closely tracking Tillis and Cornyn during Tuesday’s Judiciary Committee meeting.
Getting Blanche’s nomination on a trajectory to pass the Senate this week would relieve some of the pressure on Senate Republicans, who are juggling a long to-do list and a shrinking runway to get it done. Trump, amid last week’s standoff, demanded that Senate Republicans confirm Blanche, including warning during a Cabinet meeting that they “will never get anybody like him.”
Tillis told reporters Monday that “the back-and-forth over the weekend was not helpful” but that the talks “ended up at an acceptable place.”
If Blanche gets out of the Judiciary Committee Tuesday as expected, the soonest the Senate could confirm him as attorney general is Saturday unless Democrats unanimously agree to help speed up a final vote.
Senate Majority Leader John Thune said Monday that he’s hopeful the Senate will be able to confirm Blanche but didn’t give an ironclad guarantee as the remaining undecided members review the agreement and talk to Tillis and Cornyn.
“I’d like to figure out a way, a path forward to get him done,” Thune said.
Democrats are likely to use Tuesday’s Judiciary Committee meeting, and the days leading up to a full Senate vote, to hammer Republicans over the deal Cornyn and Tillis struck. Many predicted Monday that Trump wouldn’t stick by the agreement that limits the scope of the IRS settlement and nullifies the $1.8 billion payout fund.
“There are so many loopholes. I wouldn’t be surprised if the president went ahead with the program,” said Sen. Dick Durbin (D-Ill.), the top Democrat on the Judiciary Committee.
Sen. Tammy Baldwin (D-Wis.) warned the remaining undecided Republicans about the deal: “I don’t think that that commitment is worth what it’s written on.”
While Democrats can drag Blanche’s confirmation into the weekend, they aren’t able to prevent him from being confirmed if at least 50 GOP senators support him. But they are determined to use the debate to hit at one of their central midterm campaign messages — corruption — with Senate Minority Leader Chuck Schumer calling Blanche the “architect of Trump’s grifts.”
Tillis suggested Monday he still has questions about who in Trump’s orbit played a role in the roller coaster negotiations over the past week. While the retiring senator is prepared to support Blanche, he said that he’s “not done analyzing the anatomy of this deal and who played a role in there.”
“I’m not going to speak for other members, but I think that it’ll be a solid vote,” he added about Blanche’s chances of being confirmed.
Sen. John Kennedy (R-La.), who appeared skeptical during a Sunday morning talk show interview that Blanche would get through the Senate, did a 180 Monday when asked whether he would get confirmed: “Yes, I do.”
Jennifer Scholtes contributed to this report.
Multiple Senate Republicans joined Sen. Bernie Moreno in calling for Rep. Max Miller to step down from office Monday amid domestic abuse allegations from the Ohio senator’s daughter.
Bernie Moreno — father of Miller’s ex-wife, Emily Moreno — said in a statement Sunday that Miller should not serve in the House soon after the House Republican did a livestream video attempting to defend himself from abuse accusations.
Many of Bernie Moreno’s GOP colleagues were quick to back him following the statement.
“I don’t know [Miller]. I haven’t read a whole lot about him, but if [Moreno] thinks he ought to resign, I’m supportive of that,” Sen. Shelley Moore Capito of West Virginia said in an interview.
Miller has denied the allegations, which include pouring hot water on his ex-wife and holding a gun to her head. He has also denied accusations from his ex-wife that he broke his daughter’s collarbone.
Sen. Roger Marshall of Kansas condemned Miller, adding, “He should resign. He should quit.”
“I don’t know Mr. Miller’s story, but I trust Bernie so much as a good friend, and his family has such high values,” Marshall said in an interview. “I couldn’t imagine them wanting this out in public. So to go through with this, it makes me think that they’re telling the whole truth and nothing but the truth.”
The surge of support from Bernie Moreno’s Senate colleagues marks the first significant crack in a wall of GOP silence regarding the allegations against Miller. The skepticism from Miller’s own party will almost certainly weigh down the congressman’s already floundering campaign as he battles Democratic candidate Brian Poindexter to keep his Cleveland-area House seat.
Miller has until Wednesday to withdraw from the ballot and allow a crash primary to select a replacement.
Some Republican lawmakers stopped short of calling on Miller to withdraw or resign while expressing grave concern about the allegations.
“The accusations are very serious, and if there is truth to them, I am one who says that our elected officials need to be held to high standards,” Sen. Lisa Murkowski of Alaska said. “And certainly, when it comes to allegations of domestic abuse, child abuse, that’s not what we want in our lawmakers.”
A spokesperson for Miller did not immediately respond to a request for comment. In response to Moreno’s statement, Miller said on Sunday, “If my daughter said the same thing to me, I personally wouldn’t wait two years before holding him accountable.”
“You know this isn’t true and the only reason you are speaking out now is to hide from your own media circus,” he added in the post on X.
Notably still silent was GOP Sen. Jon Husted, Ohio’s other senator, who while leaving the Capitol Monday did not respond to reporters’ questions about whether Miller should resign.
Other Republicans in the Ohio House delegation are also staying quiet for now. Almost every House Republican from the state either declined to comment or did not respond to requests for comment on Moreno’s statement.
The exception was Rep. Jim Jordan, who brushed off questions in a Thursday CNN interview about Miller but noted he was “a good man” and was recently campaigning for him.
Asked Monday if Miller should still serve in Congress following Bernie Moreno’s statement, spokesperson for Jordan Stefanie Farrell said, “As Mr. Jordan has said, it’s up to the voters of Ohio’s 7th District.”
Back in the Senate, other Republicans who were unaware of the situation declined to weigh in on the incident.
“I am not aware of the situation, so I don’t have a comment right now,” said Sen. Joni Ernst (R-Iowa), who has been a leading GOP voice on domestic violence issues within the military.
But a steady drip of Republican senators said Monday evening they trusted Bernie Moreno.“It would surprise me if Bernie were being untruthful,” Sen. Cynthia Lummis of Wyoming said. “I guess I was surprised that it bubbled up to the public sphere, but I suspect that Bernie has got a beat on the situation.”
Sen. Jim Justice of West Virginia said he was unaware of the details of the allegations but that “Bernie’s a pretty level-headed guy.”
“I don’t know enough about the allegations, but like Bernie said, it sounds like he thinks he needs psychological help,” Sen. Rick Scott of Florida said, adding, “I trust Bernie.”
Chris Marquette contributed to this report.
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