AT THE CRITICAL MOMENT in the House debate, speaker Denny Hastert was handed a list of eight Republican moderates leery of voting for a tax cut of nearly $ 800 billion. At first, Hastert flinched. He needed to persuade four of them to vote yes for the tax cut to pass and was skeptical that he could do it. His alternative was to offer a much smaller cut — no more than $ 500 billion — that would embarrass Republicans on their trademark issue. The Washington press corps, monolithic in its loathing of tax cuts, would prefer the smaller cut. But then reporters would question Hastert’s ability to lead. So he went for the bigger tax cut, arguing chaos in the House would result from a defeat on the tax issue. Soon moderates began falling into line: John Porter and Ray LaHood of Illinois, Sherwood Boehlert of New York, Tom Campbell of California.
There was more to this victory than meets the eye. Obviously, Hastert established himself as a leader to be reckoned with. He succeeded where Newt Gingrich, given the level of mistrust toward him among House Republicans, would have failed. Also, it extended an unexpected GOP winning streak in Congress. Senate Republicans, led by Don Nickles, recently slamdunked Democrats on the patients’ bill of rights. And House Republicans, in early July, forced President Clinton to accept the concept of a “lockbox” to keep Congress from spending the Social Security surplus.
But to understand the real significance of the tax cut, you have to remember where the issue was six months ago — nowhere. The debate then was over how the surplus could be divided to pay off the national debt and spend the rest. Any tax cut would be tiny. Even Hastert expressed doubts about a 10 percent across-the-board reduction in individual rates. Senate Republicans were disinclined toward serious tax relief. But then Hastert conducted a listening tour of GOP members and discovered their top priority was taxes. So in the budget resolution, most of the non-Social Security surplus was earmarked for tax cuts.
That was the easy part, but it had an enormous impact. If House Republicans had been unwilling to set aside roughly $ 800 billion for tax cuts, the Senate Republicans never would have done the same. (Just last year, they killed a House tax cut.) Nor would a bloc of Senate Democrats have talked up a tax cut of $ 500 billion or so. Nor would Clinton have raised his ceiling for tax cuts to $ 300 billion. All this occurred in the teeth of weak polls and seething media hostility to cutting taxes. After faulting Democrat John Dingell for siding with House Republicans on gun control, the Washington Post belittled House GOP moderates as docile for not bolting on taxes. The point here is that leadership can overcome many obstacles, even in Washington, if it leads.
All the progress would have been for naught if the House had voted down the Republican bill. It contains not only the 10 percent cut in personal income, but a drop from 20 to 15 percent in the capital gains tax rate, a phasing out of the federal inheritance tax, and an easing of the marriage penalty. (The Senate version cuts income taxes less, expands IRAs more.) Since the GOP has only a five-vote margin over Democrats, Hastert’s task was to hold Republicans together. This was hard. “We have 20 guys who just don’t get the program,” says a Republican aide. At a party gathering in March, about 15 members said they opposed cutting taxes in 1999, period.
Hastert’s approach, in meeting after meeting, was low-key. According to a GOP official, “Newt’s attitude was to say, ‘You’re too stupid for your own good. Do what I say.’ Hastert’s attitude was to say, ‘I need you. How do I get your vote?'” The Gingrich style sometimes worked, if only because Republicans had votes to spare. Now they don’t. From Vern Ehlers of Michigan, Hastert heard about making the rate cut contingent on a shrinking national debt. This idea, refined by Nick Smith of Michigan, appealed especially to Campbell, and was incorporated in the bill.
At one meeting, Greg Ganske of Iowa said he couldn’t vote for the cut even with the Ehlers addition. He was asked to leave, and did. On the House floor, Republicans pleaded with Mike Castle of Delaware to go along, the Ehlers modification having been aimed at satisfying his desire to curb the national debt. He voted no. Castle and Ganske are now on Hastert’s pariah list. In the end, Hastert had votes to spare. Two Democrats — Virgil Goode of Virginia and Ralph Hall of Texas — promised to back the GOP tax cut, and four more voted for it once passage was certain. And one Republican defector, Jack Quinn of New York, was ready to vote for it if his vote was needed. It wasn’t.
So what have we learned? First, Hastert is pretty good at maneuvering the GOP majority. He’s no outside player like Gingrich, rarely appearing on TV or giving “major” speeches. He works from the inside, where he is more effective. Second, the traditional speaker’s approach — taking the temperature of members before moving forward — seems to be working again. Gingrich, for his part, acted like a president and treated GOP members like staff. And last, Republicans may finally be learning how to manage Congress and deal with Clinton. Or is that too much to believe?
Fred Barnes is executive editor of THE WEEKLY STANDARD.
