Cutting taxes sounds like an easy win for a Republican Party enjoying unified control of the federal government. But at the moment, they're struggling. Not just struggling to scrounge up concurrent majorities for a tax bill but struggling to reach any kind of consensus about what their tax bill is supposed to look like.
And while the details of this are complicated, the broad strokes of why they're struggling are pretty simple — the party has united around three big principles that are incompatible:
- They want to deliver big cuts to the taxation of investment income. This is something conservatives strongly believe will boost economic growth as well as reduce the unfairness inherent in the idea of a society in which the government redistributes economic resources from the haves to the have nots.
- They want to deliver meaningful tax cuts to the middle class — the core of the GOP's electoral pitch since at least the days of Ronald Reagan.
- Then there's the impossible third goal: They want to avoid increasing the budget deficit — or at least keep the deficit increase limited to something they can plausibly waive away with dynamic scoring.
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The problem is that this is impossible. No amount of fussing around with the details or filling in the extensive blank spots in the existing GOP tax framework will change that. To get something done, Republicans will have to go back to square one and decide what it is they're trying to do.