Congress’ GOP Leaders Drop Pursuit of Tax Cut

Formally abandoning a crown jewel of their once-glittering conservative agenda, Republican congressional leaders said Wednesday that they would not even try to pass a tax cut before this fall’s elections.

Prospects for even a modest tax cut--like the GOP’s cherished $500-per-child tax credit for families--have faded under the shadow of presidential politics and a higher political priority for members of Congress: their desire to adjourn early to campaign full time in this fall’s House and Senate elections.

“I would like to see a tax-cut proposal, but I’m a realist,” Senate Majority Leader Trent Lott (R-Miss.) told reporters as Congress returned from its monthlong August recess. “The reality is I don’t think we can get it done in September.”

The shelving of the tax cut also reflects the GOP leaders’ calculation that the tax issue will work better for their party as a campaign issue than as fodder for another round of legislative bickering with President Clinton.

“The reality is if [the voters want a tax cut], they need to make a decision on Nov. 5,” said House Speaker Newt Gingrich (R-Ga.) after a meeting of House-Senate GOP leaders. “If we passed a real tax cut, President Clinton would veto it.”

The shift on tax strategy is also a clear sign of just how vigorously GOP leaders are stripping their legislative agenda down to the bare essentials in hopes of adjourning by Sept. 27, a week earlier than previously planned.

In the remaining weeks, however, Congress may rack up one more major accomplishment: A bill cracking down on illegal immigration is heading to the House and Senate floors, perhaps as early as next week. However, the bill may face a presidential veto because it is expected to include restrictions on illegal immigrants’ access to public education.

Beyond that issue, the rest of this session is likely to be dominated by more mundane matters--principally appropriations bills to keep the government running after the new fiscal year begins Oct. 1.

The decision by the GOP leadership also reflected a political calculation. Some Republicans argued that an effort to push a scaled-back tax cut could distract from or undercut the debate over tax policy that GOP presidential candidate Bob Dole is making central to his campaign. Dole has called for a 15% cut in income tax rates, and Republicans are casting the election as a referendum on whether or not to cut taxes and scale back government.

Dole focused on his tax plan Wednesday while campaigning in Iowa, Wisconsin, Michigan and Ohio and in a new advertisement being aired in 17 states. Speaking at a round-table discussion in Ankeny, Iowa, Dole reminded the audience that “the president, when he was in Iowa in 1992, promised you that big middle-class tax cut.”

“All of you who received it should vote for him. It was so targeted it didn’t hit anybody that I know. Nobody got it.”

“What the president is saying is that some people don’t need the tax cut,” Dole said. “Now who’s gonna decide who doesn’t need it. Clinton will say the rich, they don’t need a tax cut. My view is that’s class warfare again. We’re not a class society. We’re a classless society.”

For their part, congressional Democrats are not interested in forcing a tax-cut debate either. “There is very little desire at this point to have a debate on tax cuts,” Senate Minority Leader Tom Daschle (D-S.D.) told reporters. “I think we’d be doing the people a real favor if we got these appropriations bills done.”