Wyden: Tax overhaul 'a betrayal of middle class'
Hours after leading a losing fight against it, U.S. Sen. Ron Wyden vowed Saturday to try to temper the worst features of Republican plans to overhaul the federal tax code.
Wyden made no secret of his dislike for a bill that cleared the Senate with 51 votes — all from Republicans — against all 46 Democrats and two independents and just one Republican.
He called the bill "a betrayal of the middle class."
Wyden, the top Democrat on the tax-writing Finance Committee, spoke at a town hall meeting at Molalla High School on Saturday afternoon, just hours after the Senate took its vote in Washington, D.C., early Saturday morning.
"I am going to do as much as I can, to make as much as I can, out of a bad hand for middle-class folks so they don't fall further behind," he said.
"The tax breaks for the multinational corporations are permanent. The tax breaks for the middle class are temporary. They are trying to write into law a double economic standard for our country."
Among his priorities, he said, are restoring some deductibility for state and local taxes on federal returns — both House and Senate versions cap the property-tax deduction at $10,000, and eliminate others — and for interest on student loans and high medical expenses. The House plan eliminates them; the Senate plan leaves them untouched, although it would tax stipends paid to graduate students.
Without full deductibility of state income taxes on federal returns, Wyden said some taxpayers will pay more because the Oregon tax code connects to the federal code.
Wyden was introduced by Molalla Mayor Jimmy Thompson. City councilors and three Clackamas County commissioners also were among the 100 attendees.
Wyden spoke at his 79th town hall meeting in Oregon this year.
Wyden pledged after his election to the Senate in January 1996 that he would hold such a meeting every year in each of Oregon's 36 counties. Counting a Sunday meeting in Portland, he has held 861 in almost 22 years.
Wyden acknowledged that he may not have that much influence over how the House and Senate reconcile their differing versions of HR 1.
The House could choose to accept the Senate version, which also does away with the tax penalty on individuals who fail to obtain health insurance — removal of which would undermine the Affordable Care Act. The House passed a repeal of the signature health-care law signed by Democratic President Barack Obama in 2010, but a few Republicans joined Democrats in the Senate to thwart the repeal.
House Speaker Paul Ryan said the House plans a vote to send the bill to a joint negotiating panel.
President Donald Trump has identified it as a top priority and wants to see a final bill on his desk by the end of December.
Wyden said that while he is likely to be one of the negotiators, "in a modern-day conference, people at the table who are in the majority (party) have discretion to do a lot of stuff that is light-years removed from what happened" in the two chambers.
Both versions cut the maximum tax rate for corporations from 35 percent to 20 percent.
The House version eliminates the alternative minimum tax for corporations and high-end households, and phases out the estate tax, which now applies only to estates greater than $5.5 million for individuals and $11 million for couples.
The Senate version retains a minimum tax for corporations, but trims the minimum for individuals and raises the ceiling for the estate tax.
The corporate tax cuts would be permanent.
Under Senate rules, the other tax cuts in the Senate version would have to expire in 10 years to stay within budget rules — although Congress could extend them in 2027, similar to what Congress did when President George W. Bush's 2001 tax cuts expired at the end of 2010.
"This bill is a grab-bag full of goodies for people who are powerful and well-connected," Wyden said,
"But we will run up the red ink. All those (Republican) deficit hawks flew the coop as far as they possibly could."
According to Congress' own Joint Committee on Taxation, the tax cuts will increase the national debt — already topping $20 trillion — by another $1 trillion over 10 years, and that taxes produced by economic growth will not fully offset losses in tax collections.
Wyden contrasted the current congressional debate over the tax code with the most recent successful overhaul three decades ago, when Democrats and Republicans worked together to reduce the number of tax brackets, lower rates and eliminate some tax breaks.
That effort took the better part of two years — and involved Wyden's predecessor, Republican Bob Packwood, when Packwood led the Finance Committee — before President Ronald Reagan signed it into law in 1986.
Wyden said Democrats like himself were willing to work with Republicans for some changes. But he said after Trump was elected president 13 months ago, Senate Majority Leader Mitch McConnell and the Republican leaders of the Budget and Finance committees decided to use a budget procedural maneuver to win passage of a tax-code overhaul by just 51 votes. Republicans have a majority of 52.
"In this Congress, you could not even get a majority to walk down the corridor to try to work with people," Wyden said. "We did not have to have a betrayal of the middle class for some faceless multinational corporations. There was another path."
Wyden wasn't without humor despite the outcome.
Hours after the Senate vote at 2 a.m. Washington time, Wyden — who had been up since noon the previous day to lead the bill's opponents — got to the airport for a flight bound for Oregon.
His wife, Nancy, said to him in parting: "Just make sure you don't forget your name."
Fixes details of differences between the House and Senate versions of HR 1 (tax overhaul)