Michael Barone‘s latest Washington Examiner column focuses on the possible shape of a federal deal on tax reform. He places special emphasis on the role President Obama has played in recent discussions.
Republicans, including Romney and Ryan, have explicitly endorsed extracting more revenues from high earners who, they point out, benefit disproportionately from such deductions. They just don’t want tax rates to go up, because that works against job creation.
The biggest obstacle to 1986-style tax reform is Barack Obama. In his acceptance speech, he reiterated his call for higher tax rates on high earners.
That’s as much of a deal killer for Republicans as his late-in-the-day insistence on $400 billion in additional revenues in the August 2011 grand bargain negotiations, documented once again in Bob Woodward’s “The Price of Politics.”
Obama also said he wouldn’t agree to limit the home mortgage deductions for “middle-class families.” That could be a deal killer too.
Republicans will never agree to higher tax rates because the last Republican leader to do so, the first George Bush, wound up getting 37 percent of the vote. Demanding that they do so makes any bipartisan solution impossible.
Other Democrats seem more flexible than Obama. Virginia Sen. Mark Warner spoke approvingly of a Simpson-Bowles tax reform in Charlotte, N.C. Tennessee U.S. Rep. Jim Cooper has endorsed the whole Simpson-Bowles report.
Woodward reports that during the grand bargain negotiations, congressional leaders of both parties voted Obama “off the island.” Voters who want Simpson-Bowles-type tax reform can do that in November.
