Republicans are going back on their anti-tax orthodoxy by embracing new revenues labeled fees.
On Tuesday Republican Congressman Paul Ryan and Democratic Senator Patty Murray announced a new bipartisan budget deal. The deal is relatively small, but it could enact significant changes to the status quo by ending the looming across the board budget cuts known as the sequester by instead trimming federal spending over the long term on things like pensions while also raising more revenue with policies like higher fees on air travelers.
The plan seems to have a broad base of support among Democrats and president Obama. And if Republicans don’t revolt in the next few days it could very well be adopted into law.
The deal has the potential to stop the “governing by crisis” model we’ve seen in Washington since 2011. While also cutting spending in the manner that most economists prefer, that is with long term cuts phased in overtime instead of short term automatic cuts that often hurt employment and economic growth. For both these reasons it’s probably a good deal for the country, but it also holds the intriguing possibility of finding an end run around the aversion to new taxes that has dominated Republican politics for so long.
This aversion can be seen all over Washington in the age of Obama, from conservative activist Grover Norquist’s famous “no new taxes” pledge (which almost all Republican members of Congress have taken) to the GOP’s refusals to accept new revenues as part of a grand bargain. Simply put Republicans have long seen new revenues as a deal breaker when it comes to what the federal government will spend, but now that could all change.
Strangely enough this seems to be happening through the verbal trick of simply labeling new revenues “fees” instead of “taxes.” There may be some public perception that a fee is one thing and a tax is another, but from a public policy standpoint they are both just ways of labeling money that goes to the government to be spent on other stuff. So under this new verbal trick, in theory at least, you could raise revenues from the sale of gasoline by just adding a new 10 cents a gallon “automobile user impact fee” or whatever you’d like to call it.
It of course remains to be seen if this new proposal can even pass Congress, and it could be a one-time bending of the rules because the GOP dislikes sequester cuts to the military and other Republican priorities that much. But ideological orthodoxy’s general aversion of bending the rules does make sense. After all if you break the rules once, why not break them again?
There may be little appetite for more federal revenue in the modern Republican Party, but if they agree to these new fees they could at least say yes in the future to other new forms of revenue, if only by labeling them “fees” as well. And this would be a major change from the Republicans Party we’ve grown used to over the last 20 years.
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