Taxes on the table

TAXES ON THE TABLE…. Sen. Rand Paul (R-Ky.) noted the other day that the parties will have to compromise on budget issues, but he wants to dictate the terms. The right, he said, has to budge by agreeing to Pentagon cuts, while the left has to accept cuts to everything else.

In Paul’s vision, this is a “compromise” — the parties come together to give him the cuts he wants, without raising any tax on anyone by any amount at any time.

To state the obvious, Paul and the conservatives like him have an interest in the deficit, but their top concern is the same as it’s always been — they care about taxes. If deficit reduction were the principal goal, some modest tax increases would be a no-brainer. And yet, it’s the only policy practically every Republican in D.C. refuses to even consider.

But “practically every Republican” isn’t “literally every Republican.” Late last year, Sens. Mark Warner (D-Va.) and Saxby Chambliss (R-Ga.) started talking informally about a budget plan. Their talks are ongoing — they intend to have a bill sometime this year — and have begun to include a variety of their colleagues, including (gasp!) a few liberal senators.

It’s hard to explore the substance of a plan that doesn’t really exist yet, but what I find noteworthy about the Warner/Chambliss effort is the deliberate way in which it’s rejecting the Paul-like approach. If we’re going to be serious about deficit reduction, the Republican leader of the effort said this week, tax increases have to be “part of the mix.” (via Zaid Jilani)

Chambliss made clear that despite his long record as a reliable fiscal conservative, he is willing to defy the conservative shibboleth that tax increases dare not be mentioned. “I’ve never voted for a tax increase and hope I don’t have to ever vote for one, but I do think it’s got to be a part of the mix,” said Chambliss, who has a 93.28 percent life time rating from the American Conservative Union.

Chambliss said that he and Warner — in their discussions about the $1.5 trillion budget deficit and the $14 trillion national debt — have talked about “the difficulty that he’s going to have with his side of the aisle on reforming Social Security and Medicare.” “And he knows I’m going to have difficulty on the revenue side with folks on my side.”

Now, I have a pretty strong hunch I’m not going to like what Warner and Chambliss come up with, especially with regards to Social Security. But I’m willing to give some credit to Chambliss — who can fairly be described as a not-at-all-moderate conservative from a deep red Southern state — for realizing that tax increases have to be part of any serious deficit reduction plan.

As recently as the 1980s, Reagan and the Republican mainstream considered tax increases a necessary evil that had to be passed, from time to time, in the name of fiscal responsibility. It’s why Reagan raised taxes seven out of the eight years he was in office, and he did so with plenty of Republican votes in Congress.

I don’t imagine the current GOP mainstream will be nearly as sensible anytime soon, but Chambliss’ realistic, pragmatic acknowledgement is a big step in the right direction.