In it, but not of it. TPM DC

Mitch McConnell: Tax Reform Probably Won't Happen

AP Photo / J. Scott Applewhite

"So I think we have a real stumbling block here in trying to figure a way forward," he said.

The same fundamental divide has put any sort of broad agreement on budget issues out of reach: Republican leaders have emphasized, repeatedly, that they'll only support tax reform if it's revenue-neutral. And Democratic leaders have emphasized, repeatedly, that they'll insist on raising tax revenue to help pay off the country's debt.

"I'm totally supportive of tax reform but we're going to have to have significant revenue, period," Senate Majority Leader Harry Reid (D-NV) told reporters Thursday. "When it's all over and done with, significant revenue."

The other huge obstacle to tax reform is that it'll require scaling back some deductions and loopholes. Middle class tax breaks like the deduction for mortgage interest and exclusion for employer-sponsored health care have tremendous political support and are highly unlikely to be touched. And upper-income tax breaks for capital gains and oil and gas companies are protected by an army of lobbyists.

Neither Baucus (who is retiring) nor Camp have been willing to pinpoint a single tax break they'd get rid of as part of a reform effort. Camp and Baucus both acknowledged the revenue divide and lacked any solutions to it when TPM asked them about it separately in June.

"Clearly we're in different places on that," Camp said.

"We haven't gotten that far yet," Baucus said.