Republicans suspicious of ‘Democrats’ Cohn and Mnuchin as tax plans take shape
Conservatives are wondering if Gary Cohn and Steven Mnuchin will work to keep the GOP’s right flank happy on tax reform rather than appeal for Democratic votes to get a package passed.
By NANCY COOK and RACHAEL BADE
09/13/2017 05:05 AM EDT
Conservative lawmakers and strategists have deep concerns that Treasury Secretary Steven Mnuchin and White House economic adviser Gary Cohn — the administration’s two key leaders on tax reform — don’t have the know-how or political credibility to push a major GOP tax overhaul through Congress this fall.
Neither man has ever worked in or with the legislative branch. They lack inside knowledge about how to navigate Congress at an especially fractious time. Cohn remains a registered Democrat; Mnuchin is a Republican, but he also has a long history of donating to the other party.
Those Democratic connections have been magnified in the wake of the president’s sudden debt-ceiling deal with Chuck Schumer and Nancy Pelosi, who lead the minority party on Capitol Hill. Now, Republicans throughout Washington are concerned that if the White House can’t craft a plan that unifies the GOP, Trump’s tax writers will once again circumvent Hill Republicans in order to score a win.
Case in point: Virginia Republican Dave Brat, who said Tuesday “there better not be a curveball coming up” when asked about Cohn’s and Mnuchin’s work on tax reform. While he says the two men are currently touting conservative ideas he could rally behind, he warned them against turning to Democrats.
“We don’t want our president and his administration moving all over the place away from Republican principles,” Brat added.
The White House has little margin for error on pushing a tax reform bill — even if passed using the fast-track budget reconciliation tool, which requires only GOP votes. Congressional Republicans, divided over how to replace Obamacare, flouted the administration’s effort to end President Barack Obama’s signature health law, ultimately defeated by three dissenting Republicans in the Senate. Trump also did little to help move along the effort, at one point publicly calling the House health care bill “mean” and undermining the Republicans who voted for it.
The administration is eager to notch a major legislative win ahead of the 2018 midterms and views tax reform as its best hope — a core Republican promise that administration officials think lawmakers ultimately will not want to obstruct.
Yet the dearth of policy details available from the “Big Six” — Cohn, Mnuchin and the House and Senate leaders writing the tax bill with them — is giving Republicans reason to worry. House Republicans balked during a GOP conference meeting last week when Mnuchin asked them to simply back Trump’s deal with Democrats — and are now concerned that he could do the same with tax reform.
“Mnuchin did a lot of damage to himself when he went to the House Republicans and said, ‘Vote for this shitty debt ceiling deal and do it for me,’” said one conservative strategist of the meeting. “This is a guy, who for months, had lobbied for a clean debt ceiling increase and had no idea where the conference was and then suddenly switched.”
Since early August, White House officials have held a weekly call with conservatives to talk tax reform. Last week, the White House hosted staffers from conservative groups, conservative leaders, and Republican pundits for two sessions at the White House to keep them abreast of the best way to talk about tax reform, bringing to the meetings well-known administration conservatives like press secretary Sarah Huckabee Sanders and Kellyanne Conway, counselor to the president.
White House legislative affairs director Marc Short said at a Tuesday breakfast that he stays in frequent touch with Rep. Mark Meadows (R-N.C.), chairman of the Freedom Caucus, while the president himself has held rallies in Missouri and North Dakota to build support around the country for tweaking the tax code.
“I don’t think we are ignoring the conservative base, the party that helped propel the president into his election nor the conservative base in Congress that I think has been most loyal and supportive of the president’s agenda,” Short said at the breakfast, hosted by the Christian Science Monitor.
“One thing that unites members from the liberal side, the conservative side, the moderate side is that they all say they are not getting enough attention no matter what,” he added, jokingly.
A White House spokesperson said Mnuchin and Cohn had met on tax reform with more than 200 members of Congress so far. “They freely share ideas on ways to create jobs and grow our economy, and both look forward to a productive relationship as they all work together to deliver tax reform to the American people,” the White House said.
The idea of the White House totally undercutting GOP leaders’ tax strategy and striking a deal with Democrats is not altogether inconceivable, especially after last week’s debt deal.
The president has made repeated overtures to Senate Democrats from states he won — and that’s where conservatives worry the White House will go overboard, abandoning the party or watering down the bill in Trump’s attempt to win votes on the left. And they fret that Trump’s top tax team probably won’t stop him, given their own political leanings.
Privately, the criticism about Mnuchin and Cohn is that both also lack technical and deep policy experience with the tax code that’s crucial to overhauling the tax code. From their many years as bankers at Goldman Sachs, both understand quite well the way the tax code treats interest, said one senior congressional aide. What they do not grasp is where that ranks in terms of other priorities in changing the tax code.
“They are representing more of the Wall Street perspective than the general goals of tax policy that Republicans have rallied behind for the past several years,” the senior congressional aide added.
Republicans say they won’t be cut out, however. Asked whether he worried about Cohn and Mnuchin potentially steering Trump toward a bipartisan tax deal and upending GOP leadership’s plans for partisan approach, Senate Majority Whip John Cornyn (R-Texas) winked and tried to suggest they couldn’t even if they wanted to: “We’re the ones who are going to vote on it; we’re the majority. … We control the agenda, and that’s about all I can say.”
Other conservatives say they hope the White House will read between the lines of the debt vote last week, which 90 Republicans and conservatives opposed — and see that the far right will not back a tax bill that doesn’t reflect their values.
“Hopefully, that debt ceiling meeting was a wake-up call for people to realize that House conservatives will not go along with tax legislation just because it is a Republican bill,” said Adam Brandon, president of FreedomWorks, a conservative activist group.
“My big concern us that you’ll get a tax shift, not a tax cut, and that it will not have the effect on growth,” added Brandon, who wants to see a major overhaul of the code include the elimination of the estate tax and the alternative minimum tax in addition to big rate cuts. “At the end of the day, their bona fides will be judged by what this bill looks like. If this is a good tax bill, everyone will be a good friend to Republicans. This presidency rides on this bill.”
But many Republicans on Capitol Hill — particularly in the Senate — see Cohn’s and Mnuchin’s party affiliations as an asset, not a hindrance. Sen. Steve Daines (R-Mont.), who’s having breakfast with Mnuchin on Wednesday to talk tax reform, argued, “We’re going to need some Democratic votes to get this passed, most likely.” In that regard, maybe Mnuchin and Cohn could be helpful, he added.
Some conservative groups and lawmakers have praised the duo, with Andy Roth, vice president of government affairs for Club for Growth, saying that they’ve become “singularly obsessed with passing tax reform” — something conservatives welcome. Meadows of the House Freedom Caucus said he’s found a working partner in both men.
Even Brat, the Virginia Republican, acknowledged that the conversations with Cohn and Mnuchin so far have been promising. “They’re saying all the right things,” Brat said. “They’re saying the same things Trump’s saying.”
Yet the Freedom Caucus member added that it’s “policy, not personality” that matters —— and warned that conservatives could face problems if Trump turns toward Democrats on taxes: “That’s where you wish you had conservatives lined up that say, ‘Mr. President, you do that, I’m quitting.’”