As the final nails in the coffin of Trumpcare get hammered into place, the Republicans desperately want to pivot to tax reform. Unfortunately, without understanding the multiple missteps that led to the demise of Obamacare’s “repeal and replace,” they will reach a similarly disappointing result.

Let’s start with what the public wants. Frankly, tax cuts are not at the top of the list. President George W. Bush’s tax cuts took many people off the federal income-tax rolls, while the very rich have expert tax advice and are enjoying the benefits of an economy that works for them. (In 2004 Bush could boast, “Nearly 5 million taxpayers will be off the rolls as a result of the tax relief this year.”) Their combined tax bill (including sales, property, state and local taxes) may be worrisome, but federal taxes are not oppressively high.

Contrary to President Trump’s statements, we are not the highest-taxed nation. (CNBC reports, “In fact, the U.S. ranks in the middle of the pack when compared with the roughly three dozen developed countries tracked by the Paris-based Organization for Economic Cooperation and Development.”) Therefore, it’s not surprising that there is not a grass-roots push for tax reform. (Donors and Goldman Sachs Cabinet members are a different story.)  The Gallup poll found in a poll in April that “Americans’ concern about their own federal tax burden had actually cooled somewhat, as barely half (51%) felt their taxes were ‘too high,’ down from 57% in 2016. By contrast, in June 1985, the year before the revolutionary Tax Reform Act of 1986 went into effect, 63% of Americans said their taxes were too high.”

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Lesson No. 1 of Obamacare was listen to the public’s priorities. The public wanted more health-care benefits (to have lower out-of-pocket costs); the GOP wanted to end Obamacare. That disconnect deprived Republicans of support for their health-care plans. The same will be true if the GOP thinks Americans believe everyone is overtaxed.

Nearly three-quarters of Americans believe that the tax system favors the wealthy — and half of Americans believe that President Trump’s tax plan will help the rich even more, according to a new Washington Post-ABC News poll.
More than 7 in 10 adults say the nation’s tax system already tends to favor the wealthy more than the middle class, with a 55 percent majority who feel this “strongly.” … A majority of Americans also believe that large corporations pay too little in taxes.

Moreover, by a margin of 62 to 33 percent, voters oppose reducing taxes for the rich. (The question was not whether they get should get smaller tax relief but whether they should get any. The answer was a resounding “no.”)

They haven’t yet seen Trump’s bill, but voters already don’t like it. (“When asked if they support Trump’s tax plan, opposition outpaces support by 44 to 28 percent, with nearly 3 in 10 saying they have no opinion.”) At the exact moment at which the GOP is shifting from tax reform to tax cuts, which may disproportionately benefit the rich, voters are telling us they think the tax code is not progressive enough.

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Lesson No. 2 from the health-care debate was not to underestimate the degree to which Americans resist benefiting the rich. (Even Republicans started abandoning tax cuts for the very rich in combination with Medicaid cuts for the poor.) Should Republicans abandon Trump’s promise that the rich “will not be gaining” under his plan, look for a backlash not just from Democrats but from the more populist corners of the GOP.

Finally, voters told us during the Obamacare debate and in the wake of the debt ceiling deal that they want the parties to work together. However, in the upcoming tax fight, once again the GOP insists on proceeding with reconciliation (50 votes plus the vice president). That gives Republicans a very small margin for error. And one supposes Sen. John McCain (R-Ariz.), as he did with Obamacare, will insist on regular order for tax reform/cuts.

Lesson No. 3 from health care was that Senate Majority Leader Mitch McConnell (R-Ky.) does not have an iron grip on his members. He cannot always deliver 50 of 52 votes (especially if Roy Moore joins the Senate). In this case, there are many Democrats who would join tax reform so long as it was deficit neutral and did not give more cuts to the rich. A bipartisan effort could well succeed. You’d think Republicans would have figured out that would be a much more constructive and politically popular way to proceed. Nah, they seem intent on making the very same errors that doomed Trumpcare.

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