There are times for closed-door meetings. Crafting tax reform, a key portion of the Trump agenda, does not qualify as one of those times. If the President wants to pass meaningful tax reform in his first term (and potentially before the midterm elections), he should force the “Big Six” to meet with the Freedom Caucus and conservative members of Senate. Otherwise, tax reform will quickly shift from being a slam-dunk piece of legislation into a major failure for the administration and GOP Congress.
For complete transparency, I don’t trust the Big Six: Paul Ryan, Kevin Brady, Mitch McConnell, Orrin Hatch, Steven Mnuchin, and Gary Cohn. They are all major promoters of big-government policies. Putting tax reform in their hands is like asking fast-food restaurant managers to craft a healthy diet plan. Tax reform needs wholesome fruits and vegetables. The Big Six love serving Big Macs and milkshakes.
For even more transparency, I’m a Federalist which means I don’t fully trust any members of the Democratic-Republican establishment in DC, but at least the House Freedom Caucus and a handful of Senators have demonstrated a willingness to embrace fiscal responsibility. Until my party has people in office, we’re going to have to rely on Mark Meadows, Mike Lee, and their conservative cohorts.
True tax reform requires rethinking the revenue system itself. The federal government relies too heavily on taxes to fund their pet projects. Thankfully, the solution is to build a surplus by doing two things: encouraging economic growth through tax cuts across the board and dramatically reducing the budget. The first portion should be a no-brainer, though talks of expanding revenues through other measures should concern us. Regardless of how they skew the ways dollars change hands, invariably it will be Americans who pay. Tariffs, BATs, VATs… they all find ways to pull money from American businesses and/or taxpayers.
It’s the second portion of meaningful tax reform that makes me most worried about the Big Six. Reducing costs and eliminating waste are actions that run contrary to everything these six men have demonstrated in their careers. Sure, they’ve all talked about cutting costs during election time or in board meetings, but they’ve never actually done it.
For tax reform to be both meaningful and successful, the President needs fiscal conservatives to have a seat at the table. This joint effort between the White House, Congress, and the Senate is an exercise in futility if these six men are the only ones involved. They will only do what’s necessary to keep their jobs, not what is required to fix the fragile financial situation the nation and its people currently faces For the Big Six, keeping their jobs means passing something, anything, so the President can sign it before the 2018 or 2020 election. That should terrify every American because it means their incentive has nothing to do with “meaningful” or “successful.” The reason they’ve been so hesitant to even meet with the Freedom Caucus is because they realize their plan doesn’t represent fiscal responsibility. It will include tax cuts designed for votes rather than the impact on the economy. When votes are on the line, you cut from the biggest base – middle class America – and make it up by increasing taxes on businesses and the wealthy.
To most, this probably doesn’t seem like a bad idea. Unfortunately, the benefits of tax cuts for the middle class will be insignificant compared to the economic carnage associated with the rest of their “reforms.” Increased tax burdens on businesses mean loss of jobs, cuts in productivity, and increases in prices. That’s just scratching the surface on the problems associated with those types of “reforms.”
Everything we’ve heard so far from these six men can be pieced together to demonstrate a populist and in some cases leftist plan that will only be meaningful for votes, not fixing the economy or saving money for Americans. We need eyeballs on the legislation and voices in the room while it’s being crafted. Today, those voices belong to the Freedom Caucus and Senate conservatives.
Put them in the room, Mr. President. You’re the legendary businessman. You should recognize the need for tax reform and budget cuts that will bring us to a better economic place. If you leave it up to the Big Six, the result will not be what you want.
Then again, maybe that’s exactly what the President wants.