“Repeal and replace” for the Trump tax cuts is not part of the Democrats’ election platform — at least not yet.
Some outside liberal groups want it to be. Activists on the Left want the tax law to become President Trump’s version of Obamacare, a major domestic law passed on a partisan basis that generated a wave of opposition, sweeping the responsible party out of power.
“The position is simple: Repeal and replace,” said Neil Sroka, a representative for Democracy for America, a liberal political action committee.
And while Democratic leadership, including House Minority Leader Nancy Pelosi and Senate Minority Leader Chuck Schumer, initially called for largely replacing the law, key party officials in recent days have conspicuously declined to say repeal is the goal.
Instead, they have chosen to emphasize smaller-bore issues. Asked Monday at an event in Kentucky how Democrats should proceed in the elections, for instance, Schumer mentioned student debt relief, rural broadband, and childcare as three winning issues for Democrats.
Part of the problem with running on repeal is that Democrats want to win control of the Senate, and 10 Democratic senators face reelection in states won by Trump, including five that he won by double digits.
Republicans and allied groups believe that the $1.5 trillion tax cut is an advantage in those states, not a disadvantage. The Koch-backed group Americans for Prosperity recently started an advertising campaign in Indiana and Missouri attacking those states’ Democratic senators, Joe Donnelly and Claire McCaskill, respectively, for voting against the law. The Senate Leadership Fund, a super PAC aligned with Republicans, also launched ads attacking Democrat Joe Manchin of West Virginia for voting against the bill, featuring audio of criticisms of Manchin by Vice President Mike Pence made during a recent stop to the state.
Those Democrats could be reduced to playing defense — being forced to explain their “no” votes by criticizing specific aspects of the law that they say kept them from supporting it.
For the most part, though, they have sought to talk about different topics.
“I’d love to eliminate the trillion-and-a-half dollar deficit, but that’s all gone,” said Sen. Bill Nelson, D-Fla., one of the Democrats whose state Trump won. Asked again about revisiting the tax law, Nelson simply reiterated that the topic is “gone.”
Democrats also face a challenge in that some of their most motivated voters are invested in “The Resistance” to Trump, and in attacking him specifically over accusations that he is linked to Russia or has inadequately responded to Russia’s involvement in the elections.
“You cannot just run against Donald Trump,” Schumer warned. “It is the job of we Democrats to put together a strong cohesive economic group of proposals aimed at the middle class and those struggling to get there.”
Similarly, the Democratic group Priorities USA warned in a memo last week that their polling suggested that Trump’s popularity has risen in recent weeks because the dominant political conversations have shifted away from the issues of healthcare and taxes. When Trump’s proposals to replace Obamacare and cut taxes were more in the news, his approval suffered.
The Not One Penny coalition, which includes several liberal groups that fought the bill as it was advancing in Congress, said it aimed to spend more than $10 million on ads bashing the tax law and pressuring candidates to support repealing it. The group also plans to hold events around the country rallying opposition to the law, including nationwide events on April 15, which is Tax Day.
“Not One Penny will continue to hold Republicans accountable for their votes to give away the bank to their wealthy donors at the expense of working families. Congressional Democrats must do the same,” said Tim Hogan, a spokesman for the group. “Not a single Democrat supported looting the federal government to give money away to wealthy corporations and they must own that and continue to fight back against Republican trickle-down lies.”
Yet, Democrats also have yet to sort out what a replacement might include. Many parts of the tax legislation have support among Democrats — especially the tax cuts for middle- and low-income families. Most Democrats also support a lower corporate tax rate, although they may favor one slightly higher than the 21 percent set in the GOP law.
“The answer isn’t returning to the old broken system we had before the Trump Tax Scam,” said Sroka, “but scrapping that pile of garbage that Republicans just forced through and replacing it with progressive tax policy that ensures that corporations and the super-rich pay their fair share; the social safety net that protects working families is adequately funded; and it’s easier for families and businesses to pay a fair tax on what they earn.”
The outcome, in that case, would be similar to the one that followed former President George W. Bush’s tax cuts in the early 2000s: Democrats spent years criticizing the cuts before voting for permanence for all of them except the ones that flowed to top earners.
In brokering that deal, former President Barack Obama and his fellow Democrats paid the political price of being portrayed by Republicans as tax-hikers, a political risk that Democrats are attuned to now.
“I don’t feel like we need to be trapped saying we want more taxes,” said Rep. Raul Grijalva of Arizona, co-chairman of the Congressional Progressive Caucus. “We just want them to be fair, and if they are fair then the revenue will be there to do things we want.”
In other words: Keep tax cuts for low-income people in place, and get rid of ones for high earners.
Democrats also cut taxes further by removing the limitation on state and local tax deductions that Republicans put in the bill as a revenue-raiser. Blue-state Democrats have criticized that limitation as a penalty on states that provide high levels of government services.
That change could be paired with a revenue-raising measure such as raising the top rate on high earners, said Rep. John Yarmuth of Kentucky, the top Democrat on the House Budget Committee.
“If you raise the top rate, from 37 back to 39.6 — I’d live with that,” he said.
