Back in the 1960s, when he was the tough-as-nails speaker of the California Assembly, Jesse Unruh, now the dignified state treasurer, had a favorite saying about legislators and lobbyists. In slightly expurgated form, his advice to his colleagues was, "If you can't drink their booze, take their money, fool with their women, and then vote against 'em, you don't belong in politics."
Somehow that thought came to mind when the Senate Finance Committee astonished itself -- and the rest of America -- last week by unanimously approving a major tax bill lowering rates dramatically but shutting down a host of special-interest loopholes.
After the 20-to-0 vote, committee Chairman Bob Packwood (R-Ore.) and Sen. Bill Bradley (D-N.J.), the committee's most ardent flat-tax advocate, "bear-hugged to a standing ovation," The Washington Post's Anne Swardson wrote, "while downstairs in the Dirksen basement sound room, lobbyists hissed."
To understand the magnitude of what occurred, you must understand that over the years, the Senate Finance Committee has gained a richly deserved reputation as the graveyard of "reform" and the plaything of special-interest lobbyists. An official in a previous administration once ran his finger down the names of its members, calling them "Sen. Oil, Sen. Steel, Sen. Timber, Sen. Chemicals, Sen. Real Estate, Sen. Insurance," etc., etc.
For the past year, the private fear of Reagan administration strategists has been that a credible version of the Reagan tax-revision proposal would pass the Democratic-controlled House of Representatives (as it did last December) and then be picked to pieces in the Republican-dominated Finance Committee. Two weeks ago, exactly that was happening. Committee members, including Packwood, had loaded in protections for their favorite clients and constituents. There seemed no way to "balance the books" without prohibitively high tax rates. Senate Majority Leader Bob Dole (R-Kan.) said the president's top priority bill was "hanging by a thread."
The cynics in Washington winked knowingly and said, "What can you expect?" Common Cause, the self-styled citizens lobby, put out a press release noting that Finance Committee members had pocketed more than $3 million in campaign contributions in 1985 from various political action committees, with half the money going to Packwood and Dole, the No. 2 Republican on the panel. The dismemberment of "reform" had been bought and paid for, they implied.
"An absolutely extraordinary event," said Common Cause President Fred Wertheimer the morning after the committee vote. He argued that the "public exposure of campaign finances" helped embarrass the committee into action. But the reality was more complex than that -- and more appealing.
The basic idea of lower rates and fewer loopholes embodied in the original Reagan proposal is so attractive that no one wants to take the blame for killing it. Packwood saw that, even though his history is one of using the tax code to subsidize favored projects from Oregon's timber industry to fringe benefits for his union backers. "As chairman," said Sen. George Mitchell (D-Maine), "he wanted a bill."
To get one, he reversed field, abandoning many of the established individual deductions and business write-offs while slashing top tax rates to 27 percent for individuals and 33 percent for corporations. Sen. David L. Boren (D-Okla.) said, "I told Packwood he's the best broken-field runner I've ever seen."
Sen. Dave Durenberger (R-Minn.), another committee member, said: "Politically, Bob knew all along it would take a 25- to 27-percent rate to make it work, but he didn't know how to get there. Bill Bradley showed him. . . . It was really Bradley's victory."
Bradley has been advocating a vastly simpler, three-rate tax system, with few deductions, for five years. The former Princeton and New York Knicks basketball star, who has developed into one of the Senate's most admired members, tried to sell the idea to Walter Mondale as a 1984 campaign plank. Mondale couldn't see it, but Packwood could. Bradley credited the committee turnaround to "the power of the idea," adding: "Once the chairman abandoned the brokering, special-interest approach and took the bold alternative, he captured the initiative. We were there to give him reassurance."
Sen. John H. Chafee (R-R.I.), who, like Bradley and Mitchell, lent his support to the effort from the start, rejoiced in the belief that "we've restored the pride of this committee" and have shown "we're not just a bunch of grabby individuals, concerned only about parochial interests."
The bill is imperfect. It still has to go through the full Senate and then a House-Senate conference, and there are legitimate public policy issues to be resolved. One is the question both Durenberger and Mitchell have raised about the equity of a maximum 27 percent rate for the wealthiest people in America.
But the Senate Finance Committee has redeemed its reputation and, in the process, proved that, even by the tough standards Jesse Unruh applied, its members really are politicians. Miraculously, they took from the lobbyists, and then said no.