During his first head-to-head debate with U.S. President Barack Obama earlier this month, Republican candidate Mitt Romney “debunked” the notion that Republicans are opposed to any new federal revenue, according to Rep. Peter Roskam, R-Ill. (AFP)
Republicans are increasingly open to new federal revenues as Washington seeks a vast deficit-reduction deal before tax cuts expire and deep spending cuts would kick in. Yet, the Republican idea for raising those funds is vastly different than that of the Democrats.
Echoing his party’s presidential nominee, Mitt Romney, a senior House Republican on Oct. 16 said Republicans “accept” that new federal revenues must be a part of any effort to pay down Washington’s massive deficit.
Rep. Peter Roskam, Ill., House Republican chief deputy whip, told a forum in Washington that it is a “false premise that says we don’t need more revenue.”
Roskam said that Romney, during his first head-to-head debate with President Barack Obama earlier this month, “debunked” the notion that Republicans are opposed to any new federal revenue. The party’s evolving stance, as described by Romney, is “more revenues through growth,” Roskam said.
Under Romney’s model, if more Americans have jobs, more Americans will pay federal income taxes and more monies will flow into Washington’s coffers.
“Look, the revenue I get is by more people working, getting higher pay, paying more taxes,” Romney said during the debate. “That’s how we get growth and how we balance the budget. But the idea of taxing people more, putting more people out of work — you’ll never get there. You never balance the budget by raising taxes.”
Romney’s anti-tax-hike stance embodies the GOP line over the last several years. And even as the nation heads toward a so-called “fiscal cliff” that economists of all stripes agree would plunge the U.S. economy into a recession unless Congress acts soon, Republicans are not budging from their no-tax stance.
The economy would take a nosedive off that cliff if a number of tax cuts are not extended and automatic federal spending cuts are allowed to kick in, economists and lawmakers say.
Among the issues swept up in the fiscal cliff debate are twin $500 billion cuts over the next decade to planned national defense and domestic spending. Pentagon officials and industry executives, along with their allies in Congress, warn of job cuts, squeezed weapon buys and lessened national security; some Democratic lawmakers and defense analysts believe the Pentagon budget can take more cuts, but not $500 billion.
Congress can avoid those defense cuts — and the cliff — by passing legislation by Dec. 31 that reduces the deficit by at least $1.2 trillion.
Democrats, such as Rep. Allyson Schwartz, D-Pa., House Budget Committee vice ranking member, favor a “balanced approach” that includes tax hikes on the wealthiest Americans and also cuts federal spending.
When Congress returns after the Nov. 6 congressional and presidential elections, lawmakers will have just a few weeks to pass a deficit-cutting bill that would have to cover defense spending, tax reform, domestic entitlement program reform, and a score of other prickly, complex issues.
Schwartz said during the same forum it would be “very tough” for Congress to pull off such a Herculean feat. She called on lawmakers in coming weeks to try to pass a smaller legislative package that deals with “the things we agree on,” such as extending middle class tax cuts enacted during the George W. Bush administration and establishing a sustainable growth rate of the Medicare program.
Schwartz, who because of her senior slot on the Budget Committee will play a big role in efforts to pass the kind of debt-reduction deal needed to avoid the defense cuts, is skeptical of the Romney-Roskam plan.
“We need some revenues. All of us would love to be able to say, ‘We’re going to get revenues just through growth’. But to say, ‘We’re going to lower taxes on the wealthy and hope for growth,’ we tried that over the last 10 years.”
Schwartz called the revenue-through-growth notion “a good line.”
“But what do they really mean by that?” she asked rhetorically. “We need details on how we get there.”