Budget Is Big Stakes for GOP and Tax Cuts

A new $4 trillion federal budget is big-stakes politics for the Republican Party, and failure could cost the GOP its majorities in Congress next year.

A crucial vote in the GOP-led Senate could happen late Thursday or Friday morning.

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President Donald Trump indicated on Thursday morning he is not sure if the budget will even pass. That would spell doom for the second big legislative goal of the Republicans this session — tax reform. That’s because if the Senate fails to pass the budget, tax reform cannot pass later this year because of rules known as “reconciliation.”

“Republicans are going for the big Budget approval today, first step toward massive tax cuts,” Trump tweeted. “I think we have the votes, but who knows?”

To make matters worse, Democrats have decided to limit their amendments to the budget, according to The Washington Post. That may sound good, but it’s not.

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Budget amendments are usually an easy process during the “vote-a-rama” fall budget process. But the Democrats see an opportunity to highlight hot-button issues such as gun control, according to The Post.

“I would like and I am urging my caucus to limit it to four issues,” said Sen. Chuck Schumer (D-N.Y.), the Senate minority leader, speaking to reporters in the U.S. Capitol on Wednesday.

Already, one of those amendments has failed. Sen. Bernie Sanders, the independent and self-described socialist from Vermont, tried to prohibit tax cuts for the top 1 percent of income earners. The amendment failed, and the Republicans even picked up one vote from the Democrats, Sen. Heidi Heitkamp of North Dakota.

Another issue is the old chestnut of “Mediscare,” the tactic of Democrats’ trying to scare senior citizens into believing the Republicans want to gut Medicare. Democrats are trying to tie the budget and tax cuts to Medicare, and may try a related amendment during the budget process.

“I don’t think any voter likes the idea that very wealthy people are going to get a tax break while they’re cutting Medicare, and that’s essentially the design of this bill,” said Sen. Chris Van Hollen (D-Md.), in an interview with Politico. “This is a disaster for the middle class and seniors.”

The Senate’s proposed budget would cut overall spending by $5.1 trillion over 10 years, but Democrats counter that eventual tax cuts would cost $1.5 trillion in that same time frame.

The budget also promises an on-budget surplus of $197 billion in 2027, and a $632 billion cut in nondefense discretionary spending.

But what takes shape on Friday is anyone’s guess. Sen. Rand Paul (R-Ky.) is already complaining the budget doesn’t cut spending enough.

For now, the House Republicans are watching what happens in the Senate. But clearly, even conservatives in the House Freedom Caucus are eager to notch a win after the failure of the GOP-led Congress to pass health care reform.

One aide to a conservative House member said that conservatives in the GOP caucus are eager to move on to tax cuts, and will compromise on spending levels.

“We’ll have to wait on specifics until we see what they pass, but in general, we’ve been willing to be more flexible than usual on budget levels provided we get certain things on tax reform,” the aide told LifeZette on Thursday morning. “That is, 25 percent maximum small business rate, 20 percent corporate tax rate, etc.”

(photo credit, homepage images: Rand Paul, CC BY-SA 2.0, by Gage Skidmore / Mitch McConnell, CC BY-SA 2.0, by Gage Skidmore ; photo credit, article images: Rand Paul, CC BY-SA 2.0, by Gage Skidmore / Mitch McConnell, CC BY-SA 2.0, by Gage Skidmore)