Paul Ryan showed up to Senate Republicans’ weekly lunch on Tuesday hoping to salvage a controversial pillar of his tax reform plan that would change how imports and exports are taxed. “Keep your powder dry,” the House speaker pleaded.I assumed that with a Republican in the White House they'd have no qualms about running huge deficits in order to slash taxes for corporations and the rich, but it seems that some of them actually believe their own talking points about deficits and debt. So they're trying to offset the huge cut in revenues -- and Republicans don't like the method Ryan has chosen.
The next day, Sen. Tom Cotton took to the Senate floor to slam Ryan’s so-called border adjustment tax, saying “some ideas are so stupid only an intellectual could believe them.”
“Many other senators share these concerns and we most certainly will not ‘keep our powder dry,’” Cotton went on, without naming the speaker in his speech.
The sequence was an ominous sign for a linchpin of Ryan’s tax plan — and perhaps for the prospects of tax reform happening at all. The border adjustment tax would generate more than a trillion dollars over a decade; there’s no obvious way to replace that money, which is needed to help pay for a steep cut in corporate and income taxes.
Many Republican senators say privately they detest the concept, fretting that it will hurt their in-state retailers like Walmart, which is headquartered in Cotton's state of Arkansas. Senate Finance Chairman Orrin Hatch (R-Utah), sources said, has warned Trump and Ryan that border adjustment won't likely have the support needed to clear the Senate....So this is another dog-that-caught-the-car issue for Republicans, just like Obamacare. But do you know who actually likes the border adjustment tax? Darth Vader himself:
That’s not to mention Ryan’s issue in his own chamber. A handful of Ways and Means Republicans — including some with close ties to Trump — are fretting that retailers slapped with an import tax will ultimately pass the cost onto consumers.
Ironically, the speaker seems to have a strong ally in Bannon, the ex-boss of Breitbart News, which attacked the speaker mercilessly during the campaign.Well, of course he likes it. Recall what I told you last week: Bannon is a believer in the generational theories of William Strauss and Neil Howe, who foresee a crisis point for America in which citizens will need to suffer in order to reach the Promised Land. They've written:
... new leadership will assert public authority and demand private sacrifice. Where leaders had once been inclined to alleviate societal pressures, they will now aggravate them to command the nation’s attention.And Bannon said in 2010, foreseeing this moment of crisis:
“We are going to have to take some massive pain. Anybody who thinks we don’t have to take pain is, I believe, fooling you.”So he has no problem with a tax that will passed on to consumers. The president presumably has no idea that this tax or the tax he proposed during the campaign, a levy on imports, will be passed on to consumers. And congressional deficit hawks don't want either.
So the GOP dysfunction is at both ends of Pennsylvania Avenue. To me, that's a relief.