Play all audios:
Republicans are in a bind. They want to pass a tax bill, but (a) they don’t want to pay for it and (b) they want it to be permanent. Sadly, a combination of PAYGO and reconciliation rules¹
prevent this. What to do? One option is to design a bill that would get some Democratic support, and then pass a deficit-busting bill with 60 votes in the Senate. However, Republicans have
no interest in working with Democrats, especially since Democrats would insist on a bill that doesn’t benefit the rich. That’s a nonstarter. So they’re back to square one. Bloomberg reports
on their latest brainstorm for sidestepping the rules: > Under the proposal, the GOP would not account for things like > expiring tax breaks when gauging the budgetary impact of tax
> legislation — giving tax writers more room for cuts. SENATE > BUDGET AND TAX PANELS ARE DISCUSSING THE MOVE TO A “CURRENT > POLICY” BASELINE — INSTEAD OF THE STANDARD “CURRENT
LAW” > BASELINE — said the people who asked not to be identified because > the discussions are private. The chief House tax writer, Kevin > Brady, also signaled openness to the
approach last month, saying it > would lead to deeper tax cuts. If you’re even close to normal, you’re thinking, “WTF does _that_ mean?” That’s what I’m thinking anyway. But a couple of
charts will help us work our way through this. Let’s suppose we have a tax break of five quatloos that expires halfway through the next decade. Starting in 2023, instead of _saving_ five
quatloos, you have to _pay_ five quatloos. It looks like this: If Republicans decide to extend the tax break, it will increase the deficit by 50 quatloos (5 years x 10 quatloos) compared to
current law. This is, quite sensibly, how CBO scores things. But wait! Suppose Republicans declare that their intention has always been to extend the tax break. In other words, current
“policy” is that the tax break goes on forever. Then it looks like this: The cost of extending the tax break is zero! Republicans are basically saying that since they planned to do this all
along, it shouldn’t count against the baseline. But here’s what I don’t get. This is obviously a fantasy, and it’s one that CBO will never go along with. In the real world, extending a tax
break that’s scheduled to expire does indeed increase the deficit. So to do this, Republicans would have to overrule the CBO’s score of their bill. But if they’re this determined to do what
they want to do, why not cut the crap and simply instruct the Budget Committee to declare that their bill has no effect on the deficit? It doesn’t really matter how. Just assume enormous
economic growth or something. The Budget Committee has final say over the score, so they can ignore CBO if they want. What’s the point of all this absurd rigamarole? More here from CBPP if
you’re interested. ¹Or, as Donald Trump put it last night, “It’s a trick.”