U.S. Senate pulls off win with a Hail Mary pass on tax bill

In the wee hours of Saturday morning, the U.S. Senate passed on a 51-49 vote, a tax reform plan that the Republican majority has said will redefine not only the tax structure for Americans, but also help add jobs to the economy, and give tax relief to the middle class. But, as Democrats have noted, those claims have disingenuous, as the bulwark of them cited in a study by the Congressional Budget office, show that instead of relief, there would be a tilt towards deficit, and that only some people, not all would get tax relief.

Then a much anticipated report from the Joint Committee on Taxation, came out with its assessment of the plan, but not one to bring joy to the debate. It revealed: “A new analysis released today by the Joint Committee on Taxation found that the Senate tax bill would generate enough economic growth to lower its $1.4 trillion revenue cost by only about $458 billion over a decade. After accounting for interest rates, the growth figure would fall to $407 billion, said the JCT, Congress's official scorekeeper on tax legislation. That would leave a 10-year revenue loss of roughly $1 trillion.”

Eager for a legislative win, by the end of the year, The GOP, despite its trifecta of holding majorities in both chambers of Congress, has failed to secure any wins, and only losses, especially in promises made on the 2016 campaign trail, such as repealing Obamacare, which failed miserably on two attempts.

Nerves were shot, as the Capital lights burned late into the night, with 14 hours of debate, and there was some horse trading to get to the final vote, as well as a dramatic shift by some that were essentially opposed to the plan. But, if politics is the art of compromise, then adding a few more made the day.

Most notable was James Lankford, the concerned senator from Oklahoma, whose focus on the prospect of a deficit had many worried, and who along with Bob Corker of Tennessee wanted a trigger to remove the tax cuts, and increase taxes, should the plan refuse to refuel the economy as promised. This was dashed when it was defeated by the senate’s parliamentary rule.

The Oklahoman reported that “On Thursday, the nonpartisan Joint Committee on Taxation, taking into account that economic growth, estimated the bill would increase the national debt by $1 trillion. On Nov. 5, Lankford told “Meet the Press” that he would oppose a tax bill that significantly raised the debt, saying, “I'm actually not comfortable with increasing the debt.”

Lankford and other fiscal conservatives were faced with a decision Friday: to accept a bill that will add to the debt or vote it down, spoiling a major Republican initiative. The Oklahoma City Republican chose the former.”

This would not be the first, or possibly the last time, that political expedience, and no doubt, the last helps to win the day, albeit through party loyalty.

"This is a great day for the country," Majority Leader Mitch McConnell (R-Ky.) said during a 2 a.m. press conference after the vote., and added, "We have an opportunity now to make America more competitive, to keep jobs from being shipped offshore and to provide substantial relief for the middle class."

The statement is somewhat dubious, and while it does reflect a change in competitiveness, by lowering the U.S. corporate tax rate, it does so by siphoning off tax deductions from the very people it purports to defend, like the middle class, by removing the state and local income tax deduction.

With some, there is an echo of Reaganomics, when the plan’s supporters suggest that this will result in greater job creation, and the money funnelled back into employment when previous efforts showed that, when given tax holidays, most of the companies gave the money back to their shareholders, and there was no job creation.

Wags are saying that the plan’s creators, along with their House counterparts, think that the American public is dumb, dumber, and dumbest, when it comes to seeing the picture behind the picture.

Holding firm for a profile in courage, was Corker who voted no on the bill, and said ". . . At the end of the day, I am not able to cast aside my fiscal concerns and vote for legislation that I believe, based on the information I currently have, could deepen the debt burden on future generations,” in a statement.

“But GOP leadership appeared confident on Friday that they would be able to pass the legislation after GOP Sens. Ron Johnson (Wis.) and Steve Daines (Mont.) came on board, reported the stalwart news forum, The Hill.

Johnson and Daines had been pressuring for a larger tax deduction for small- and mid-sized businesses known as “pass-throughs.”

Johnson noted that Republicans had been able to get the deduction increased from 17.4 percent to 23 percent and that he would be involved in further pass-through discussions as lawmakers work to get the bill to Trump’s desk.

"A seat at the table. Not just input. Not just consulting, but a seat at the table," Johnson said when asked what leadership promised him in exchange for voting "yes."

More help came from Jeff Flake of Arizona, when he gave McConnell the 50th vote for the plan.

“The Arizona Republican, who is retiring after 2018, said that, in addition to getting rid of a “budget gimmick” relating to the full expensing of capital investments, he had also gotten a commitment on the Deferred Action for Childhood Arrivals program.”

The conscience of the senate is Susan Collins, “a moderate who voted against the GOP’s ObamaCare repeal efforts, also voted in favor of the legislation after getting several of her amendments into the bill, including the restoration of a $10,000 deduction for property taxes and a lower threshold for deducting medical expenses, said to reporters, "I will cast my vote in support of the Senate tax reform bill. As revised, this bill will provide much-needed tax relief and simplification for lower- and middle-income families, while spurring the creation of good jobs and greater economic growth.”

Democrats,who were outnumbered, and outfoxed,were forced to complain in sidelines, or in amendments, that were more protest, than hope, an unenviable position, but also was the only one that the minority party can play when it is dealt out of the game.

It brought fellow politico observers, such as myself, a few chuckles to see that the GOP now in the majority, forgot their own similar behavior when the roles were reversed.

The biggest loser was ObamaCare with the repeal of the individual,mandate, the penalty that people must pay, if they choose not to have insurance, yet most -- at least 80 percent of all Americans, get their coverage through their employer, or from the government, in either the form of Medicare or Medicaid.

What is unclear is what the outcome will be after Collins, who was assured by Trump and MCconnell that there would be two more compromise bills (to help Americans retain the cost-sharing benefits of Obamacare) can offer, or retain. Of course, as was attributed to St. Theresa, the road to hell is paved with good intentions.

The CBO does say that markets will remain stable, on the exchange and a recent study by the Kaiser Family Foundation, found that this was the sixth straight year that employer provided policies have increased well under five percent, giving some assurance that the markets may not roil with this repeal.

Smaller companies are the exception and according to KFF, over the last five years, “the percentage of business with under 50 workers, offering coverage, has fallen from 59 percent to 50 percent,”  reported The New York Times at the end of September.

There is still some hope that the Alexander-Murray compromise will hold firm yet most realists say that there is such firm opposition to that bipartisan efforts, that hopes rest on reinsurance, where there will be monies for sick people, and help to decrease premiums.

For now, the remaining chance is for the House to approve the Senate bill, or both chambers to reconvene to pass a compromise bill, and at this point, it may be all over but for the fighting.