Drama erupted on the Senate floor in the middle of the tax debate Thursday evening, as three Senate Republicans threatened to send the GOP tax bill back to the committee, in a move that would have stalled the bill’s momentum for weeks.
The tension boils down to a very simple reality: Republicans have a tax bill that makes deficit hawks like Sens. Bob Corker (R-TN) and Jeff Flake (R-AZ) very uneasy. On its face, the proposal, which gives corporations a massive tax cut, will increase the deficit by $1.4 trillion in 10 years — or, when adjusted for economic growth, by $1 trillion, according to the Joint Committee on Taxation.
So on Thursday, Flake and Corker, who want to ensure a more fiscally conservative tax bill, and Sen. Ron Johnson (R-WI), who has been arguing for more tax breaks for “pass-through” businesses, withheld their votes for the greater part of an hour on a Democrat-supported motion from independent Sen. Angus King (ME) to send the bill back to committee for negotiations. In the end, Corker, Flake, and Johnson all voted with their own party and kept the tax bill alive, but the moment signaled a major vulnerability in Republicans’ plans to pass this tax bill.
There are a lot of reasons it’s so difficult to make the math work, but one is that Republicans have insisted on lowering the corporate tax rate from 35 percent to 20 percent. That’s a lot of revenue to make up based simply on economic growth projections.
For the past week, Corker and Flake have been trying to negotiate a “deficit trigger” for the tax bill; if the rosy deficit forecasts from this tax bill prove to be inaccurate, and the economy does not grow as fast as Republican leaders are saying it will, then Read More Here