In early afternoon, CBS News reported Vice President Joe Biden and Senate Minority Leader Mitch McConnell (R-Ky.) have brokered a deal on taxes. Under the proposal the threshold for paying higher income taxes would be $400,000 for individuals and $450,000 for families. Estate taxes will rise from 35 percent to 40 percent with an exemption for the first $5 million.
How this plays out in the Republican controlled House of Representatives is yet to be seen. Late this afternoon, however, the House leadership announced no vote on any deal would take place today.
Up until now, McConnell has not been a constructive contributor to the process. The proposed deal may bring back some shine to his very tarnished armor. If it holds, McConnell merits credit for the compromise.
Biden and McConnell still must convince respective party members not thrilled with the plan to vote for it. Many Democrats wanted a lower threshold on income taxes and a higher rate on estate taxes. In contrast, many Republicans will be displeased the income tax threshold isn’t higher and the estate tax rate lower. Some Republicans will balk at the notion any taxes should be raised.
McConnell, with Boehner following, has the most to lose politically. It may set up the senator from Kentucky for a primary by someone further to the right than him.
Ironically, considering McConnell’s social and economic pedigree he could end up looking slightly right of center by comparison to a primary opponent instead of a hardcore, militant, uncompromising conservative. It will be telling what his Republican colleague from Kentucky, Rand Paul will do. If Paul doesn’t support the plan, then the junior senator will probably support a challenge to McConnell in a nasty, expensive primary.
Also at issue is whether House Speaker John Boehner (R-Ohio) can find enough votes to support the latest plan. Fortunately, he won’t need his full caucus to do it. The Speaker should have enough votes, minus the Tea Party wing, to join with House Minority Leader Nancy Pelosi (D-Calif.) and her caucus to enable passage. This assumes Pelosi can get her members behind the plan. In each case, “party discipline” isn’t what it once was when leadership had tools to cajole members into voting a certain way.
Assuming he can maneuver around obstructionist Tea Party members and get the Biden-McConnell bill to the floor for a vote, Boehner’s bigger problem comes when the new Congress is sworn in. He may face a challenge to his speakership. It is something he can survive, but it could weaken him. Or he may show the deft political skills to spin a challenge to underscore his willingness to compromise and behave like a responsible lawmaker.
Administratively, getting a bill printed at this point and distributed to lawmakers will be tough. The logistics are difficult to surmount in a timely manner. If there is a deal at the deadline or slightly thereafter no mandates to slash spending and raise taxes will likely occur. More probable is Wall Street will hold its breath, hard pressed Americans will continue to fight on, and Washington will just ignore the law until a new one, more to its likely is passed.
Paul Jesep is an attorney, policy analyst, and author of Lost Sense of Self & the Ethics Crisis: Learn to Live and Work Ethically; Credit Card Usury and the Christian Failure to Stop It; and Crucifying Jesus and Secularizing America – the Republic of Faith without Wisdom.