Republicans pass tax breaks, but don’t pay for them
April 29th, 2014
06:44 PM ET
4 months ago

Republicans pass tax breaks, but don’t pay for them

Washington (CNN) – Republicans want to cut the deficit. And Republicans want to cut taxes. Tuesday, those two sweeping goals collided as a GOP-controlled House committee voted to advance hundreds of billions in tax cuts at the cost of adding those billions to the deficit.

The House Ways and Means Committee voted almost entirely along party lines to make six tax breaks permanent at a cost of $310 billion over the next 10 years.

The top Democrat on the committee pounced.

“To say that Republican action today is hypocritical is a serious understatement,” Rep. Sandy Levin of Michigan said. “This approach today of Republicans flies smack in the face of fiscal responsibility.”

But the committee’s Republican chairman, Dave Camp, also of Michigan, did not blink. He responded that the tax breaks have been passed year after year without any offsets.

“This bill has been extended, unpaid for, probably 30 times,” Camp said of a research tax credit. “I think it’s important we extend this … supporting permanency, not a temporary extension.”

Team Camp also points to another argument: They believe the jobs that come from tax breaks are worth adding some red ink to the deficit.

“These are things that people feel are extremely worth adding to the economy,” said Camp spokeswoman Sarah Swinehart.

What’s $310 billion get you?

These six so-called “tax extenders” that the Ways and Means Committee approved Tuesday were plucked from a larger group of 55 tax breaks that expired at the end of 2013 and have been waiting for congressional renewal.

Among those passed Tuesday were three biggies: the research and experimentation deduction, the credit that helps small businesses with major equipment costs, and the break for businesses earning rent and interest overseas.

Camp was correct. In recent years, Congress has extended the breaks year after year without offsetting their costs. But in the 90s, most of them were offset.

Why the flashpoint now?

Democrats are particularly pressing the issue now because they see a conflict between the Republican demands that spending, especially on Democratic priorities like unemployment benefits, be offset while the GOP allows their own priority – tax cuts – to add to the deficit.

“It’s a clear double standard, particularly when you hold up unemployment,” said Chuck Marr, director of tax policy at the left-leaning Center on Budget and Policy Priorities.

But Democrats also have exceptions to pay-for pushes, notably, many Democrats believe that unemployment benefits are emergency spending and do not need to be offset.

When asked if that is a double standard from the left, Marr said no.

“Unemployment insurance is a temporary, countercyclical move,” he replied. “What Republicans are doing here is pushing for something permanent and unpaid for.”

GOP chooses tax cuts at expense of deficit

Republicans insist their decision to choose tax cuts over trimming the deficit is nothing new.

“(Chairman Camp) has the position that extensions of current policy and tax cuts don’t have to be paid for,” said Swinehart. “Pay-fors are for spending. New spending. That’s his position.”

Yet, in Camp’s recent sweeping tax reform proposal, he did pay for all the tax cuts he extended. He did that largely by repealing other tax cuts. But that proposal is not going anywhere.

Camp insists that’s not a contradiction. His office argues that paying for tax breaks is only possible in a comprehensive revision of the tax system, not when tax breaks are taken one by one as the House is preparing to do now.

The result: On Tuesday, Republicans on the Ways and Means Committee choose their anti-tax crusade over their image as deficit hawks.

Next, all Republicans in the House will face a similar choice.

Multiple GOP sources tell CNN they expect all six tax credit bills to get votes on the House floor and that leadership is still working out the exact timing.


Filed under: Congress • Republicans • Taxes
soundoff (68 Responses)
  1. GOP = Greed Over People

    Ah, the GOP mantra, "the deficit is the biggest detriment to growth, except when we say it is not"!

    April 30, 2014 09:01 am at 9:01 am |
  2. Wake Up People! Many Rivers to cross.....

    What's new? That's the GOP mantra. Spend but don't pay. Two wars come to mind....

    April 30, 2014 09:01 am at 9:01 am |
  3. michael

    Hypocrites! The rich keep getting richer under GOP and the poor poorer. Bet, you they won't pass minimum wage hike to $10.10 HR. America is blind to their hypocritical rhetoric! Next, they will vote for the 51st time to dismantle Obamacare! What a waiste of taxpayers money! Boehner where is the Jobs? All You have to do is pass something that would pass the Senate and the President would sign, its been 5 1/2 years we are waiting! So, get out of the Tea Party's butt and do something, enough with the tired old political talking points and GOP rhetoric. You, and your cronies have not did nothing for Americans for over 5 years but exhibit political theater, division, deception, propaganda and lies! It seem your drive to make this President to look like a failure is working, while your failing Americans the same time! It boils down to this Mr Boehner, it is either America or your political agenda, and by the way actions speak louder than your words!

    April 30, 2014 09:02 am at 9:02 am |
  4. Malory Archer

    This bill has been extended, unpaid for, probably 30 times,”

    ++++++++++++++++++++++++++++

    Yeah, except YOUR party is the one chomping at the bit to "reduce the deficit" and "balance the budget", mr. camp. Dems nationwide need to RUN with this in this season's campaign, and call the reds out for the lying hypocrites they are.

    April 30, 2014 09:06 am at 9:06 am |
  5. bill

    No problem. Just put it on our bank of china credit card. If that doin't work----– blame Busch.

    April 30, 2014 09:09 am at 9:09 am |
  6. Gunderson

    Good Lord,
    Another democrat that is still wet behind the ears talking about fiscal responsibility? When did the liberals ever consider anything like fiscal responsibility? If they had we would not have a nearly 18 Trillion Dollar Federal Debt. You want fiscal responsibility liberals? Just reduce federal spending and begin paying down the federal debt and then you can talk about fiscal responsibility.

    April 30, 2014 09:16 am at 9:16 am |
  7. Dead Bear

    The biggest farce in this country's political landscape is the idea of a "fiscally responsible" Republican. Their behavior over the last 40 years, especially when they have occupied the White House, suggests otherwise.

    April 30, 2014 09:26 am at 9:26 am |
  8. Name. MADMOTHER

    What happen to live within your mean !!! I guess that just working peoples. The republican party is mentality ill!!!

    April 30, 2014 09:28 am at 9:28 am |
  9. O'drama ya Mama

    Republicans showing their true colors. Refusing to raise the minimum wage for the workers who make next to nothing but instead they cut taxes for the wealthy who barely lift a finger. Doesnt the GOP realize that the workers are the ones making the billions for these corporations? Why are you rewarding the corporations and not the worker? Can some "conservative" explain this reasoning?

    April 30, 2014 09:28 am at 9:28 am |
  10. devil's advocate

    Its the fiscally responsible thing to do, give more tax breaks to the 1% group of people who took 95% of the wealth, from policies just like the one their voting on now. When will America wake up, how does this help the working class, I doesn't, that's why they have only one response, job creation, oddly its the one of two times you'll ever hear jobs, keystone being the other. Both are worthy of lies of the year.

    April 30, 2014 09:40 am at 9:40 am |
  11. sonny chapman

    George W. Bush cut taxes for the Wealthy(Job Creators). Millions in Job LOSSES. Bill Clinton raised taxes on the Wealthy(Job Creators). TWENTY TWO Million Jobs CREATED. The Republican War on Math continues.

    April 30, 2014 09:42 am at 9:42 am |
  12. Michael MN

    We all from the Bush years that tux cuts mean more revinue , And the Iraq war will last 2 months and be paid for by selling there oil

    April 30, 2014 09:44 am at 9:44 am |
  13. kerrypenn49

    The democrat party revolves around and its philosophy is based on Lies and Deceptions.
    Do Not Trust democrats!

    April 30, 2014 09:46 am at 9:46 am |
  14. Winning

    Their reasoning: cutting revenue increases revenue. For all their kvetching and carrying on about Orwell and "1984," they have a complete mastery over the doublethink skill.

    April 30, 2014 09:50 am at 9:50 am |
  15. Winning

    I See Tom L, so increasing the deficit is only bad of the left does it. Glad to know you are consistent in your ideology. Partisan hack.

    April 30, 2014 09:56 am at 9:56 am |
  16. The Real Tom Paine

    @tom l, since when is it a good idea to cut a revenue stream when the debt has been one of the top priorities since Obama took office? One other thing: does our economy resemble the economy we had under JFK? Reagan used JFK as a justification for his tax cuts, and that is what began the huge deficits we began running. How can you have lived through the era of Reagan ballooning the debt, and not make the connection, or does your Objectivist views preclude admitting that you might be wrong?

    April 30, 2014 10:00 am at 10:00 am |
  17. devil's advocate

    How much wealth going to the top 1% is acceptable to you tom l.: your textbook argument has been proven false time after time, how do you not feel foolish?

    April 30, 2014 10:02 am at 10:02 am |
  18. Lynda/Minnesota

    Oh yes ... finally a true breaking news article: Republicans pass tax cuts without paying for the tax cuts.

    Oh wait. Yeah, I thought so. Not breaking news after all.

    GOPerville continues its hypocrisy. Again.

    April 30, 2014 10:03 am at 10:03 am |
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