Wednesday :: Mar 10, 2004

Moderate GOP Senators Prepare To Abandon Bush Over His Tax Cuts

by Steve

Don’t look now, but Bush is about to lose his own party on the issue of making his tax cuts permanent. And the Democrats’ demand to protect the middle class tax cuts and toss overboard the rest of Bush’s cuts is about to be adopted by moderate GOP Senators.

The Senate appears ready to adopt strict new budget rules this week that would make it more difficult to permanently extend President Bush's tax cuts, a potential blow to the centerpiece of the president's election-year economic agenda.

A bipartisan bill written by Sen. Pete V. Domenici (R-N.M.) and Sen. Russell Feingold (D-Wis.) would allow those cuts to be extended only if they are offset by equivalent spending cuts or other tax increases. That mandate could be overridden only by a 60-vote majority. The measure would exempt three tax cuts aimed at moderate-income households that expire this year: the expanded 10 percent income tax bracket, the $1,000-per-child tax credit and the "marriage penalty" cut.

"What we need to do is take a deep breath," said Sen. Lindsey O. Graham (R-S.C.). "You write bad checks at home, they put you in jail."

Republican Sens. John McCain (Ariz.), Olympia J. Snowe (Maine), Susan Collins (Maine), and George V. Voinovich (Ohio) expressed their support, and Sen. Lincoln D. Chafee (R.I.) appears to be leaning in favor of it.

"The bottom line is, we've got to get . . . some budgetary rules that will enforce some discipline around here," Snowe said.

Graham said there has been a marked shift among Republicans toward deficit reduction and a growing recognition that the deficit will not be tamed by budget cuts alone. Republicans pressed for major tax cuts last year to pump up a sluggish economy. But Graham said that with economic growth taking hold, "we have to look now at how [another tax cut] fits into the big picture."

The public appears to share that concern. A Washington Post-ABC News poll this week found that voters still narrowly support Bush's tax policy, with 50 percent approving and 47 percent disapproving. But 65 percent of those polled said they disapprove of the president's handling of the federal deficit.

The Domenici-Feingold amendment may be only the first impediment to further tax cuts. Moderate Republicans say they may team up with Democrats to remove language in the budget resolution allowing the Senate to approve tax cuts worth as much as $80 billion over five years with a simple majority of 51 votes -- not the 60-vote super-majority needed to overcome a filibuster. Sen. Charles E. Grassley (R-Iowa) said there is "a good possibility" that such language will be stripped.

I wonder how Bush will campaign on the issue of tax cuts and deficits this fall when his own caucus has abandoned him over their concerns about fiscal responsibility. These tax cuts were never about pumping up the economy so much as they were about pleasing Bush's base. The problem with these base-pleasing measures is that when they conflict with basic tenets that the party used to hold, like fiscal responsibility, the interests of the moderate Senators and Representatives clash with the interests of the president. And when that happens, it is inevitable that schisms like this will occur.

It’s going to get pretty lonely out there on that ledge Mr. Bush.

Steve :: 7:40 AM :: Comments (6) :: Digg It!