◼ Republicans, instead of listening to their K Street friends, ought to see the debate over expiring tax provisions as a chance for minor tax reform — and even for some populism of their own. - Timothy P. Carney/Washington Examiner @TPCarney
...In truth, Obama is playing political chess. He’s trying to outflank the GOP on the populist side. Back in 2012, he could get away with fighting for corporate loopholes in 2012. Now that opposing these breaks wins him populist points, he goes on the attack.
“The president would veto the proposed deal,” the White House said, “because it would provide permanent tax breaks to help well-connected corporations while neglecting working families.”
Obama’s attack resonated among left-leaning journalists: New York Times writer Eric Owles wrote on Twitter: “2014 Election Results: major tax breaks for corporations & race horse owners, but not for the working poor.”
Republicans could curse Obama's hypocrisy and dishonesty. Or they could be smart, and call his bluff — and then out-populist Obama.
It’s standard behavior for Republicans, but it needn’t be. The opposite approach is arguably more conservative, and certainly more of a political winner.
Instead of making permanent corporate tax credits, Republicans could scrap the tax credits altogether. This would be a tax hike, sure, but it would also make the tax code more neutral, which conservatives understand is good for the economy. And the revenue generated by closing the loopholes can be used as an offset for other tax cuts: reducing the corporate tax rate, or providing tax relief for regular people still suffering from the recession. Propose this and force Obama to defend his beloved tax credit for General Electric's windmills.
While Obama’s favored family tax relief involves more targeted tax credits, and picking winners and losers, a conservative tax cut for working families could be simpler: Cut payroll taxes for everyone. Republicans could slightly lower the payroll tax rate, or create a small personal exemption, so the working poor get to keep their first few thousand dollars before being forced to contribute to Warren Buffett's Social Security.
