By Sam Goldfarb
Hoyer strongly endorsed rewriting the tax code — an objective recently floated by the White House — saying that it would require and could attract bipartisan support in the next Congress.
The Maryland Democrat presented his vision for the new Congress in a speech before the National Press Club. But his presentation was overshadowed by questions about House Democrats’ strategy for dealing with a bill (HR 4853) to extend the expiring 2001 and 2003 tax rates (PL 107-16, PL 108-27).
The Senate is widely expected to pass that bill, which would extend the rates for two years, in the coming days. Hoyer left the door open to House changes to the measure, saying such a move would likely keep the House in session past the Dec. 17 target adjournment date set by Senate Majority Leader Harry Reid, D-Nev. White House spokesman Robert Gibbs also said Congress is likely to still be in session next week.
Beyond taxes, it will be difficult for Republicans and Democrats to unite behind many domestic policy issues.
Republicans will hold a 242-193 House majority next year, and the GOP Conference is widely perceived to be more conservative than in the past. The Democratic Caucus will be more liberal, as more progressives than conservatives won re-election.
With Democrats still in control of the Senate and the White House, the political dynamic is not necessarily conducive to large-scale achievements. But Hoyer, who will be minority whip in the 112th Congress, insisted that House Democrats would be able to find a useful role and continue to advance legislation.
The election results “were from a public that wanted us to share responsibility, to find common ground on our common problems — to put forward a domestic agenda that thinks in terms of decades, not election cycles or news cycles,” he said.
Changing Tax Policy
Hoyer’s comments on future tax policy came one week after Obama suggested a willingness to revamp the tax code.
Extending the current tax rates for two years could create a window for considering major tax changes of the sort that have not occurred since the Tax Reform Act of 1986 (PL 99-514).
Referring to the 1986 bill, Hoyer said it was “relatively easy” to pass once there was agreement between President Ronald Reagan and Illinois Democrat Dan Rostenkowski, the chairman of the Ways and Means Committee.
Although the 1986 law raised revenue by eliminating tax preferences such as the investment tax credit and the state and local sales tax deduction, it was deficit neutral because it also lowered tax rates, particularly on higher incomes.
Hoyer said that the next effort to simplify the tax system would need to raise money overall in order to lower the national debt.
Hoyer said he was pleased that Obama “has indicated that he’s giving tax reform serious consideration” and added that he has started conversations with Republican leaders about how to proceed on the issue in the next Congress.
So far, Republicans have said little directly in response to Obama’s long-term tax overtures. But earlier this month, House Republicans on the president’s bipartisan fiscal commission, including incoming Ways and Means Chairman Dave Camp of Michigan, unanimously opposed a deficit reduction proposal that included a tax overhaul of the kind suggested by Hoyer.
Two out of three House Democrats on the panel also voted against the deficit proposal, while three Senate Republicans and two Senate Democrats voted for it.
Challenges for Bipartisanship
Hoyer said Democrats and Republicans could work together to ensure the solvency of Social Security, improve math and science education, boost scientific research, streamline regulations that affect businesses and reduce discretionary defense spending.
But House Republicans vowed in their pre-election “Pledge to America” to cut discretionary non-military spending to 2008 levels. Not only did the platform suggest wariness when it comes to cutting Pentagon programs, but it almost certainly would mean less money for scientific research.
Rather than tweak regulations that “are hindering innovation,” as Hoyer suggested, Republicans also have promised vigorous efforts to roll back at least parts of the Democratic health care (PL 111-148, PL 111-152) and financial regulatory overhauls (PL 111-203).
Hoyer said Democrats would stand firmly behind the legislation that they passed in the 111th Congress. “There are, of course, some core principles which we should not and will not compromise,” he said.