For months we've been told that the one-page tax reform outline released by the White House earlier this year was just a preview of a more serious or robust plan that would be released later but, as you may have expected, there is no plan.
Bloomberg first reported last night that congressional leaders are not expecting to see a plan from the White House and will create their own.
Trump is not expected to set forth his own plan or many specifics, the official said. Instead, Trump will advocate broad themes of middle-class tax cuts, simplifying the tax code and making businesses more competitive in a way that encourages job creation, the official said.
Republican congressional leaders weren’t expecting to release a joint tax plan with the White House, according to two people familiar with the matter. Instead, they’ll rely on House and Senate tax-writing committees to solve the big questions that remain unanswered, the people said.
My immediate reaction upon reading this late last night was that not releasing a plan will make it easier for Trump to blame congressional Republicans when they release (and fail to pass) a plan that is nothing like he promised.
And that brings me to my second point: if Trump is going to sell a plan that includes middle-class tax cuts and a simpler code, that means he'll be selling a plan that doesn't exist.
Everything we know about the GOP's internal deliberations and desires tells us simplifying the tax code is not even being discussed and significant middle-class tax cuts aren't either. Actually, the latest word is that congressional Republicans want to pay for tax cuts for the rich by eliminating deductions for state taxes, mortgages, and 401Ks. That would decimate the middle-class.
If they can't pull that off, their backup plan is to simply pass deficit-financed tax cuts using budgetary gimmicks.
I'm still betting on the latter because there are many blue state House Republicans who aren't going to vote to dramatically raise taxes on the majority of their own constituents.
Some Republicans have floated the idea of passing "tax reform" next month, but it appears that timeline has slipped to "by the end of the year." I expect it will slip to next year if, as I expect, the federal government will be funded through December with another continuing resolution. If that happens, we'll be having the government shutdown discussion again sooner rather than later.