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Trump’s bipartisan tax reform push would blow up Republicans’ strategy

President Donald Trump Meets with House and Senate Leadership Photo by Olivier Douliery - Pool/Getty Images

At times, it feels as though President Donald Trump and House Speaker Paul Ryan exist in separate worlds.

In Ryan’s world, Republicans are about to introduce a tax reform plan that will unite the majority party and give them a signature conservative agenda win. Ryan and tax-focused Ways and Means Committee Chair Rep. Kevin Brady (R-TX) spent the week reassuring Republicans that their tax cuts would be permanent and as deep as possible.

In Trump’s world, there’s a path to a bipartisan tax deal with moderate Democrats and Democratic congressional leadership. Trump even returned to his refrain of saying he would be willing to raise taxes on the wealthy — something that seems out of line with Republican congressional leadership.

“What you have is a degree of at minimum confusion and at maximum anarchy that ensues when you say, ‘I want to do tax reform,’ and supposedly you work with the Kevin Bradys of the world to say this is the Republican version of tax reform and then, before it is even out, cut the legs out from under these guys and say, ‘Well, if we need to raise taxes on the wealthy, we will do that.’ I guarantee that is not the plan that Kevin was pitching to all of us,” Rep. Mark Sanford (R-SC), a conservative who sits on the Budget Committee, told Vox of Trump.

Sanford, who has long been openly critical of Trump, is outlining a chief frustration among Republicans on Capitol Hill: Trump, increasingly desperate to declare some policy wins, will tell anyone what they want to hear to get a deal through — regardless of what his party leadership is actually attempting to execute.

Top Republicans want a do-over with tax reform — but the conference isn’t convinced

As far as Paul Ryan’s office is concerned, things are moving forward with the current plan being drafted by Senate and House Republican leadership, as well as two members of the Trump administration, Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn.

Meanwhile, at Trump’s bipartisan congressional meeting this week, he told Democrats that he would raise the taxes on the wealthy if needed: “If they have to go higher, they’ll go higher,” he said, proposing a bipartisan working group on tax reform that House leadership staff seemed to know little about.

Brady, caught slightly off guard by the president’s comments, responded briskly: “My goal is to lower taxes on every American," he told reporters.

It’s become increasingly apparent that there are two simultaneous, contrary tracks running on tax reform.

“There are two different things that are happening: discussions in the White House and discussions on Capitol Hill,” said Rep. Mark Meadows (R-NC), who chairs the House’s most conservative faction in the Freedom Caucus and has positioned himself as an important negotiating figure in Republican-led tax reform efforts.

On Wednesday, House Republican leadership was aggressively trying to convince skeptical members to get on board with a GOP-led effort on tax reform. Ryan and his team outlined a plan aimed at cutting corporate tax rates from 35 percent to somewhere around 20 percent, and pass-through tax rates to around 25 percent. They assured members that they were working to make these tax cuts permanent. Ryan’s biggest Republican skeptics, including Meadows, came out of the session calling the GOP leadership’s presentation a “good start.”

Republicans invested in executing Republican-led tax reform have spent months making the pitch that this debate will be much easier than the one over health care was. The White House — specifically Trump — is less certain of that pitch.

Surrounded by a group of moderate Democrats and Republicans, the president made the possibility of bipartisan tax reform look very appealing.

“Clearly up here on the Hill, the partisan play is still alive and well, and if that works, that’s awesome,” Rep. Tom Reed (R-NY), a more moderate member, said after the meeting in the White House. “I will tell you I am not optimistic that the partisan play will work in the end.

“When he brought the press in and publicly stated that he not going to cut the taxes on the wealthy and would consider increasing taxes on the wealthy, I hope that is a message I heard loud and clear that he looking to cut a deal, because that is contrary to anything that has been stated from the partisan approach.”

The result is the same cyclical confusion that has complicated Republicans’ legislating on Capitol Hill from the start: Ryan says one thing that Trump at one time seemed to agree with; then Trump says the opposite, and Republicans have to scramble to make sense of it all.

Trump is mad about how health care went, and it’s not making Republican leaders’ lives easier

Trump has spent the week billing himself as the great bipartisan dealmaker, flirting with Democrats on everything from immigration to infrastructure to tax reform. But in doing so, he’s rustled some feathers among congressional Republicans. Needless to say, it’s never helpful to anger your own party — especially when they run the legislative agenda.

Even so, congressional Republicans close to Trump are quick to say the president is not happy with GOP leadership right now.

“I would tell you he is very frustrated with what happened with health care, and he’s going to do everything he can to make sure that doesn’t happen with tax reform,” Rep. Chris Collins (R-NY), a close friend and ally of Trump’s, said Friday. “We’re never going to deliver 218 votes; we saw that with health care.”

Trump is looking to “cut a deal” with anyone who will work with him, Meadows said — acknowledging that this could lead to much less conservative legislation. And after Trump received widespread praise from Democrats and the political pundits for striking a deal with Democratic leaders on raising a clean debt ceiling, funding the government through December, and passing aid for Hurricane Harvey, House Minority Leader Nancy Pelosi and Senate Minority Leader Chuck Schumer have seen more traction with the Trump White House.

What these rumblings for bipartisan negotiations mean for the actual policy appears to be beside the point for the president — but that’s not the case for top Republican leaders. Ryan, Brady, Senate Majority Leader Mitch McConnell, and Senate Finance Committee Chair Sen. Orrin Hatch (R-UT) established very early on that they are working toward a conservative tax plan that is unlikely to garner much support from Democrats.

Both Ryan and McConnell have made slight nods to the other side of the aisle, saying they welcome “serious” voices from the left to come along with them. They aren’t upending the drafting process to involve Democrats and have not welcomed any liberal tax policy ideas.

It’s clear that the White House’s determination to bill Trump as the great bipartisan dealmaker, however, hasn’t made Ryan and McConnell’s lives any easier — making them look as though they have been cut out of the process altogether.

So now the White House and GOP leadership appear to be working in spite of each other.

“The value of the executive branch is that you drive a stake in the ground and you say, “This is due north and this is where we are going,” and then people line up and they coalesce for you or against you, but it allows for normal battle lines to form,” Sanford said.

For Trump, due north appears to be whoever can get him closer to a legislative win.