Obama’s ‘grand bargain’ not going anywhere

President Obama will propose a new "grand bargain" on tax reform in Chattanooga, Tenn. today. But this attempt at a deal is basically DOA.


Obama makes the GOP an offer they can refuse.

What Obama's proposing: a corporate tax overhaul, with the profits used to fund domestic stimulus. But while there's been bipartisan agreement on the need for corporate tax reform, Republicans want it to be paired with individual tax reform. And they want it to be revenue neutral, as it was in Obama's April budget. In this proposal they don't see enough concessions to make it a bargain at all.

House Republican leadership is also annoyed that the White House didn't reach out with this offer directly before it appeared in the press. Here's House Speaker John Boehner's spokesman:

In fact, the White House says, a bipartisan group of lawmakers were briefed on the proposal, and Obama adviser Dan Pfeiffer specifically disputes that Boehner wasn't contacted. MSNBC reports that the White House has had promising conversations with some Republican senators about separating corporate from individual tax reform. Still, the Senate GOP is wary of moving on its own. “We really can’t go first,” Sen. Orrin Hatch (R-Utah) told the Post in April.

The White House can't be expecting the House GOP to suddenly cave. They're trying to do a couple of things. First, expand the idea of a "grand bargain" to mean not just deficit reform but any sort of economic agreement, and challenge Republicans to come up with a counteroffer. Second, try to win support from the business community for a proposal that contains two things they want: tax reform and domestic investments.

Most of all, Obama is simply making clear that tax reform is one of his priorities, as Ronald Reagan did in his second term. “Tax reform is a drama with heroes and villains and a damsel in distress,” Reagan said in 1985, in a speech given in -- wouldn't you know it -- Tennessee.

Rachel Weiner covers cops and courts in Arlington and Alexandria.
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Sean Sullivan | July 30, 2013