Will Max Baucus Sell Out Dems On Taxes?


Max Baucus has given liberals plenty of reason to question his adventures off the reservation (see his votes for the Bush tax cuts in 2001, for Medicare Part D in 2003, and his drawn out health care reform negotiations in 2009).

His latest involves protracted discussions with House Ways and Means Committee Chairman Dave Camp about reforming the tax code. As a Republican, Camp has made no secret that he wants any reform to be revenue neutral.

So it’s no surprise progressives sense danger.Now I don’t think liberals need to worry that a hypothetical, revenue-neutral agreement between Baucus and Camp will become law, at least not right away. The problem is it would have a very big downside in that it would upend the rather improbable fact that Dems have unified around the need for tax hikes. And that will have immediate effects on people running for Senate this year.

First, on policy, if the two men cut a deal it would be hard, though not impossible (and, oh yeah, a monumental act of betrayal) for Baucus to end run Senate Dem leaders this Congress. Also Obama still has veto power. So it’s hard to see it happening. But more on all of that later.

For now what matters are the ripple effects such a deal would have on status quo legislative politics and on midterm elections. And my sense is it would be pretty damaging to both the Democratic party and liberal budgeting goals. Baucus is up for re-election this cycle in a state Obama just lost badly. He chairs the powerful Finance Committee. And even if he’s just trying to burnish his cred with voters in Montana, a revenue neutral deal with Camp — even a non-starter — would undermine a tax revenue consensus it took Democratic party leaders years to build.

Other vulnerable Dems — Mary Landrieu, Mark Pryor, and the rest, many of whom have already voted for higher taxes in the Democratic budget, and elsewhere, and are on the hook for the political consequences — would be under immense pressure to follow suit. Their old votes would be wasted. Their own re-election fights would become more complicated. But more importantly a crucial but fragile consensus would be shattered, and the door to much-needed higher revenue would be closed tighter, and for longer, than it already is.

Which is probably why the White House and Senate Dem leadership want to nip this in the bud.