I’m told House Dems — with the support of leader Nancy Pelosi — are set to propose a new way to pay for it: A bill that would attach continued funding for the trust fund to a proposal to raise $20 billion by restricting U.S. multinational corporations from lowering their taxes by moving headquarters abroad.
“This will accomplish two important goals through one legislative action,” Dem Rep. Chris Van Hollen, a leading party strategist who is planning to push the new measure, tells me. “It will deter American companies from deserting U.S. taxpayers, and use the revenue to create jobs here at home.”
At the same time, the proposal to block corporate inversions is also running into opposition from Republicans and some Senate Dems. So why not use the urgency of the pending Trust Fund insolvency — and the blow to the economy and jobs it would entail — to increase leverage to close this corporate loophole?
Some will dismiss the idea as a hopeless stunt, and it’s true the proposal very well may not go anywhere. Even with the need to replenish the Trust Fund, House Republicans may be unwilling to entertain it. But Van Hollen insisted some Republicans with projects in their states and districts might prove gettable. State governments are already scrambling to find money to fill the looming shortfalls.
“It’s crunch time,” Van Hollen said. “Members from both parties are hearing from their states that the uncertainty is already creating a slowdown in projects. We’re reaching out to Republicans who may see the merit in making sure the Trust Fund has what it needs by making it harder for American companies to desert the United States.”
“This combines two immediate actions critical to our economy,” Rep. Levin adds.
Dems will tie this to their broader message about helping the middle class while Republicans preserve an economic status quo that’s rigged for the wealthy — a message that unites the “Fair Shot” agenda of Senate Dem candidates with ongoing attacks on GOP candidates as tools of the Koch brothers.
“Leader Pelosi supports the proposal to close this special interest tax loophole to create jobs and make critical repairs and investments to roads and bridges,” Pelosi spokesperson Drew Hammill tells me. “The contrast made by this proposal is very clear: Democrats are working to build an economy that works for everyone, not just the wealthy few.”
The idea may also be a long shot because some Senate Dems — such as Finance Committee chair Ron Wyden — will only consider closing the loophole as part of broader tax reform. But Van Hollen says Dems will start by pushing it in the House, to test what kind of “coalition” can “gain traction,” challenging Republicans to oppose it.
“We think this could have legs,” Van Hollen said. “This will have support from the overwhelming majority of the public. I wouldn’t want to explain to constituents why I’m allowing a green light for American companies to turn their backs on American taxpayers, instead of extending transportation funding for another 18 months.”