CQ TODAY ONLINE NEWS
Sept. 15, 2011 – 10:33 p.m.
Boehner Issues Warning on Taxes
By Richard E. Cohen, CQ Staff
House Speaker
In a speech Thursday to the Economic Club of Washington, Boehner, R-Ohio, essentially directed the panel — which is only just beginning its work and is on a tight deadline — to find ways other than tax increases to trim the deficit by at least $1.2 trillion over a decade and recommend policies that will expand employment.
“Tax increases . . . are not a viable option for the joint committee,” Boehner said. “It’s a very simple equation. Tax increases destroy jobs. And the joint committee is a jobs committee. Its mission is to reduce the deficit that is threatening job creation in our country.”
The White House wasted no time rejecting the Speaker’s effort to throw President Obama’s $447 billion jobs plan (
“Any plan to grow the economy and create jobs should be measured by whether it puts money in the pockets of middle class families, puts teachers, police officers, firefighters and construction workers back to work, and invests in our small businesses so they can grow and hire,” White House Press Secretary Jay Carney said in a statement. “The president’s plan meets that test.”
But Boehner said the deficit committee should try to devise a broad, revenue-neutral overhaul of the tax code, an imposing task last tackled by Congress in 1986.
Conceding that “it’s probably not realistic” for the panel to deliver a final rewrite of the tax code by its Nov. 23 deadline to adopt recommendations for Congress, the Speaker said the committee “can certainly lay the groundwork by then for tax reform in the future that will enhance the environment for economic growth.”
Boehner said the panel could lay out “principles for broad-based tax reform,” including lower rates for individuals and corporations and the closing of deductions, credits and other breaks.
With a dual message that could expand the joint committee’s daunting workload and limit its debt reduction options, Boehner may have increased the already dicey task facing the panel of six Republicans and six Democrats.
Chiming In
The Speaker’s voice was not the only one calling on the deficit reduction panel to broaden its objectives. A bipartisan group of senators urged the joint committee to increase its deficit reduction target to reach $4 trillion in savings.
Georgia Republican
Boehner repeated his call for Democrats and Obama to abandon their “all or nothing” approach to spurring the economy, providing a sign that the House majority is unlikely to allow a vote on an intact version of the president’s proposal.
Boehner Issues Warning on Taxes
The Speaker’s scant references to the plan, which Obama unveiled Sept. 8 before a joint session of Congress, added to signs that the president faces a difficult time in moving his proposal.
But in response to questions following his speech, Boehner left the door open for the joint committee to take up the president’s plan. “It’s too early to determine” whether the panel may handle at least some proposals included in the president’s plan, he concluded.
Boehner dismissed key aspects of Obama’s plan (
A Surprising Ally
House Minority Leader
Pelosi’s support for tax increases to pay for Obama’s proposals poses complications.
Boehner is well aware of the difficulties in trying to find common ground in a politically divided government. After his speech Thursday, the Speaker said he and Obama “get along with each other,” but that their divergent personal backgrounds “from two different worlds” sometimes make it seem like they “barely understand each other.”
The remarks came during a post-speech response to a question from Economic Club President David Rubenstein, managing director of The Carlyle Group.
Boehner also said he and Obama were not close to agreement this summer on a “grand bargain” debt reduction deal. “It’s hard to put Humpty-Dumpty back together again,” he added.
Steve Bell, who left the Senate staff in 2009 after more than a quarter-century as a Republican budget expert, said additional expectations could make it harder for the joint committee to do its central task.
“It’s going to be a distraction from what the joint committee should be doing,” said Bell, now a top aide on economic issues at the Bipartisan Policy Center. “Trying to handle the jobs bill is inconsistent and makes its job more difficult.”
But Bell’s group also wants the deficit reduction panel to take a bolder approach and order the tax-writing committees to draft further entitlement cuts and a tax overhaul by next April. He called on both parties to “pierce those bright red lines that they have used as cudgels against each other: Medicare for Democrats, and tax-and-spend for Republicans.”
Having discussed the proposal with members and staff of the joint committee, Bell said it is too early to gauge whether the panel will seize the broad authority it has to set in motion more sweeping action on a tax overhaul next year. The party leaders’ support of tax overhaul could be a “significant step,” even with their disagreements over the revenue impact.
Boehner Issues Warning on Taxes
Shifting Gears
In his downtown lunch speech to a mostly supportive audience, Boehner also outlined another policy initiative. Offering almost no specifics, he said any long-term extension of surface transportation programs should include provisions to expand energy production. “There’s a natural link between the two: As we develop new sources of American energy, we’re going to need modern infrastructure to bring that energy to the market,” he said.
Boehner developed the idea of linking energy production with transportation programs while speaking with groups during the August recess, and has begun discussing it with leaders in his conference, said spokesman Michael Steel.
Increasing production of oil and natural gas and dedicating some of the royalties or associated fees to infrastructure is not a new idea. Former Speaker Newt Gingrich raised the proposal recently on the Republican presidential campaign trail.
Kathryn A. Wolfe and Ben Weyl contributed to this story.