by Mitch Kokai
Senior Political Analyst, John Locke Foundation
The Trump administration, and Republicans in Congress, very much want to pass a tax cut right now. Some Democrats want to cut taxes, too, though usually different taxes for different taxpayers. So the Republicans want to use the reconciliation process to pass the tax cuts in a way that forecloses the possibility of a Democratic filibuster. That means that the tax cuts will be temporary, expiring in ten years.
Republicans, until the day before yesterday, understood the value of certainty. During the Obama years, they made a great deal of noise about “economic uncertainty” related to Democratic proposals for taxes, regulation, health-care reform, and the like. They have since had a change of heart and have embraced uncertainty — certainly in the person of President Donald Trump, who is dangerously mercurial, but also in more quotidian matters. They put forward temporary tax cuts and short-term economic fixes. …
… There is not going to be any certainty on the big domestic-policy items — taxes, health care, the entitlements, and much else — until there is a reasonable, sober, sustainable settlement on our national fiscal challenge. So long as the charade of ten-year sunsets and CBO-satisfying accounting shenanigans rule the day, there is not going to be any predictability — and that is going to impose real costs on economic growth, employment, wages, and future prosperity.
We don’t have regime uncertainty. We have a regime of uncertainty. And it is time to change that.