The big question bedeviling the Capitol Thursday is whether anti-tax zealot Grover Norquist just gave House Republicans the coded signal that they can vote for a bill to reduce deficits and raise the debt limit even if the plan contains new tax revenue.
In an interview with the Washington Post‘s editorial board, Norquist addressed the question of the Bush tax cuts — which are scheduled to expire at the end of 2012. “Not continuing a tax cut is not technically a tax increase,” Norquist said. Would that violate his anti-tax pledge? “We wouldn’t hold it that way,” he said.
Democrats are latching on to this to press Republicans to back off their insistence that any debt limit package be revenue neutral. At a Capitol press conference Thursday, House Democratic Whip Steny Hoyer (D-MD) read the quotes out loud to reporters. “I think Mr. Norquist has made a very important statement that I hope they each take into consideration,” Hoyer said, referring to House Republicans.If this is the blink Democrats hope it is, then maybe Republicans will ease up in the current fight. But there are a few reasons to be skeptical.
First of all, on MSNBC Thursday morning, Norquist issued the following caveat. “Any changes in taxes should be kept separate from the budget deal,” he said, referring to the debt limit.
Second, if some or all of the Bush tax cuts expire, it can happen in a relatively passive way. Congress can do nothing, or Republicans can vote to extend the cuts, and President Obama can veto them. The debt limit fight is quite a bit different — Democrats want to let some of the Bush tax cuts expire, plus raise revenues by eliminating certain tax preferences, offset part of those new revenues with tax cuts elsewhere, but on the whole end up with more money coming into the government than comes in now.
Third, this cuts against just about everything Norquist has said or done throughout the debt limit debate. He picked a big fight with Tom Coburn over the idea that a debt deal could increase federal revenues. He loomed over a Senate effort to end ethanol tax subsidies, arguing that they should be allowed to continue unless the extra revenue was dedicated to tax cuts elsewhere. And he ripped the idea of a revenue-positive debt limit deal to Huffington Post‘s Sam Stein, “Democrats are saying, ‘Hey, here is your salad, do you want anchovies? Do you want shards of glass?… No, no shards of glass.’ ‘How about half the amount of shards of glass?’ ‘No, no shards of glass.’ ‘How about a sprinkling of shards?’ ‘No, no freaking shards of glass. We are making a salad here.'”
So it’s not really clear that Norquist would keep quiet if a debt limit deal included a provision extending most, but not all, of the Bush tax cuts. And it’s also not clear if House Republicans would accept it, even with his tacit approval. We’ll try to answer these questions for you today.
Watch the video of Norquist’s MSNBC appearance: