A group of eleven moderate Senate Democrats say they want to work with Republicans on addressing the GOP’s expiring tax cuts and raising the debt ceiling.
In a new letter to Republicanleaders, they say they are willing to cut spending, protect family-oriented tax policies, have “competitive” rates on businesses — and that they can provide enough votes to allow Republicans to overcome a filibuster in the Senate without having to resort to so-called reconciliation.
The lawmakers say they’re otherwise worried Republicans will tack the $4 trillion cost of extending their tax cuts onto the deficit, which will increase interest rates for everyone, something nonpartisan budget forecasters have recently warned about.
“We understand that the Senate Republican conference is likely to use the budget reconciliation process to address these expirations,” said the letter, put together by Sens. Catherine Cortez Masto (Nev.) and Mark Warner (Va.), both of whom sit on the tax committee. “While we respect the majority’s right to do so under Senate rules, we believe a better outcome can be achieved by working in a bipartisan manner to reform the tax code and address our growing national debt through responsible spending reforms.”
“We believe a fully deficit-financed, partisan effort could risk raising costs for families, driving up interest rates for Americans looking to purchase a home, and increasing borrowing costs for American businesses and consumers.”
Republicans appear unlikely to take them up on the offer, though it presents a potential answer to many of the jams they now face.
The GOP is deeply divided over the cost of renewing their tax cuts, not to mention scads of individual provisions like the $10,000 limit on state and local tax deductions, and are sure to have a difficult time raising the debt limit. Some have never voted to increase the legal cap on government borrowing.
Republicans have struggled to even agree on scheduling, with weeks of debate over whether they should take up immigration first or combine it with their tax plans.
Tax debates are typically highly contentious, but there was a surprising outbreak of bipartisanship last year when House Ways and Means Committee Chair Jason Smith (R-Mo.) and then-Senate Finance Committee Chair Ron Wyden (D-Ore.) agreed on a plan to expand breaks for parents and businesses. It was overwhelmingly approved by the House before later dying in the Senate.
No Democrats voted for Republicans’ original 2017 tax cuts, much of which are now due to expire at the end of this year. Rolling them over is projected to cost some $400 billion per year, and the price tag has become a major issue given the government is already running $2 trillion deficits.
The prospect of a bipartisan tax plan would raise a whole different set of challenges though, with the two sides likely to clash over issues like how much to charge businesses and high earners. The moderates signing the letter would also likely take heat from fellow Democrats who are opposed to the tax cuts and would be happy to see them expire.
The lawmakers said they can work with Republicans on business-related provisions.
“Good faith negotiations can ensure the permanence of a competitive tax code for American businesses with reasonable effective tax rates and competitive treatment of capital and R&D expenses, as well as a rational international tax regime,” they wrote.
“While there will certainly be challenges to finding bipartisan agreement on certain issues, we believe addressing the growing deficit and reducing unnecessary spending can serve as a basis for good faith bipartisan negotiation.”
The letter was also signed by Sens. Raphael Warnock (Ga.), Tim Kaine (Va.), John Hickenlooper (Colo.), Mark Kelly (Ariz.), Gary Peters (Mich.), Jacky Rosen (Nev.), Ruben Gallego (Ariz.), Elissa Slotkin (Mich.) and Jon Ossoff (Ga.).
