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Here's how Trump and the Democrats could actually get tax reform done

  • As tax reform heats up, the icy wall separating all cooperation between Trump and the Democrats is starting to show some cracks.
  • This began with Trump realizing he needed Democrats to ensure speedy hurricane relief and Democrats starting to realize they have to prove they're interested in governing again.
  • At least three Democrats in the Senate could easily back Trump's tax reform plan, and more could follow.
Senate Minority Leader Chuck Schumer (D-NY) (L) makes a point to President Donald Trump in the Oval Office prior to his departure from the White House September 6, 2017 in Washington, DC.
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Senate Minority Leader Chuck Schumer (D-NY) (L) makes a point to President Donald Trump in the Oval Office prior to his departure from the White House September 6, 2017 in Washington, DC.

President Donald Trump is offering Congress a bipartisan path to some kind of a tax reform deal, and there are actually some signs the offer isn't dead on arrival.

The set up to this deal in the making are the last eight months of historic rancor in Washington between the Democrats and the president, Republicans and the president, and the usual sniping between Democrats and Republicans.

The result is precious little has been accomplished. The White House and the Republicans have the confirmation of Neil Gorsuch to the Supreme Court to crow about, and they can continue to at least try to take credit for the stock market rally and three percent GDP growth, but that's about it.

The Democrats have helped stoke the anti-Trump fires for all they're worth, with the assembling of the Robert Mueller team to investigate the administration a key victory. But casting a cloud over this president is hardly a legislative accomplishment, and it may not yield much more than continuing to depress Trump's poll numbers.

Meanwhile, the failure to pass an Obamacare repeal and replacement bill has mostly hurt the Republicans, but it will hurt all of Washington unless something can be done to stave off a wave of massively higher insurance premiums and disappearing coverage options.

"That act of God just came in the form of two massive hurricanes that have seemed to snap most of Washington's warring parties out of their mutually destructive trench warfare."

For just about all of this year so far, the D.C. dysfunction has been so bad that it seemed like only an act of God could turn things around.

That act of God just came in the form of two massive hurricanes that have seemed to snap most of Washington's warring parties out of their mutually destructive trench warfare.

President Trump got the ball rolling by making a debt ceiling deal with Democratic congressional leaders to make sure any efforts to aid the victims of Hurricanes Harvey and Irma would not be held up on Capitol Hill. The deal was seen by some critics as the White House betraying the GOP congressional leaders, but House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell reluctantly went along as they likely saw the extreme political peril of even appearing to stand in the way of disaster aid.

And that brings us to tax reform.

Even as Hurricane Harvey had already flooded much of Houston and Hurricane Irma was taking aim at Florida, one Democrat was starting to make another breach in icy Washington wall. That Democrat is Senator Heidi Heitkamp, who joined President Trump last week on his trip to her state of North Dakota to push for tax reform. Heitkamp is one of a handful of Senate Democrats in states that voted for Trump last year who are up for re-election. And senators like her are a natural place for the White House to start.

President Trump continued down that road by inviting Democratic Senators Joe Manchin of West Virginia and Joe Donnelly of Indiana to a bipartisan White House dinner on tax reform Tuesday night that Republican Senators John Thune, Orrin Hatch, and Pat Toomey also attended. These are the first signs of actual progress in the quest to get something passed without the GOP being forced to resort to reconciliation or eliminating the filibuster rule.

There may be even more signs of deal making returning to D.C. Though Senate Minority Leader Chuck Schumer blasted President Trump's proposal to repeal estate taxes in a letter signed by every Democrat senator except for Donnelly, Heitkamp and Manchin, by focusing on just one aspect of the reform plan it could also mean the Democrats are actually starting the counteroffer process.

Perhaps they'll go for other parts of the plan if the White House scraps the estate tax part. It's not the stuff of a Nobel Peace Prize, but it's also a far cry from shouts of "Not my president!"

For now, what President Trump seems to be offering Democrats is a legitimate seat at the tax reform crafting table. That's significant since the White House and the GOP leadership could theoretically go it alone if they can get their post-Obamacare repeal failure act together.

News that Schumer and House Minority Leader Nancy Pelosi will be attending another bipartisan dinner at the White House Wednesday night to discuss immigration, Obamacare, and other issues possibly including tax reform may be even more promising. That's because Democrats could be showing signs of realizing that just bashing Trump won't do them much good as they try to win back those who voted for him in 2016.

Couple these moves with the proposal crafted by Senator Bernie Sanders Wednesday calling for single-payer health care or "Medicare for all," and we're starting to see signs of a Democratic Party that realizes it must prove it is interested in governing again.

Before the hurricanes and the Heitkamp news, you could count me among those who doubted tax reform of any kind was going to happen. But now that President Trump may not have to rely solely on the meager deal making efforts of Republican leaders like McConnell, the odds have improved.

It appears that President Trump truly wants to give the Democrats some kind of seat at the governing table when it comes to tax reform, and based on his statements last week on DACA, he seems to feel the same about his signature issue of immigration as well.

This is a bipartisan gift President Trump is handing the Democrats at a time when leaders of his own Republican Party are flailing. And this time, it's a gift that the Democrats just might be smart enough to take.

Commentary by Jake Novak, CNBC.com senior columnist. Follow him on Twitter @jakejakeny.

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