Chief Republican tax-writer is talking a good talk on corporate America
Timothy P. Carney
For a generation, conservative Republican politicians have wrongly believed that corporate America was their friend — and that’s a generous interpretation. Republicans, seduced by the donor class or simply confusing profits with capitalism, have increased government spending, complexified the tax code, and supported mandates and regulations because big business wanted it.
Recall Lindsey Graham asking Mark Zuckerberg to help him write the regulations of social media. Recall Fred Upton pushing the light bulb law because the big manufacturers supported it. Recall the GOP supporting the Wall Street bailouts, the Medicare drug benefit, the Export-Import Bank, and massive federal spending in general.
THE NOT-SO-RADICAL NIKOLE HANNAH-JONES
Republicans have supported corporate tax credits and the carried-interest loophole.
Republicans typically give lip service to small government and free competition, and then favor activist government and big government when big business asks for it.
Jason Smith says that’s about to change.
Smith is a sixth-term congressman from Missouri, and as of this year, the chairman of the House Ways and Means Committee. Ways and Means writes tax laws, and Ways and Means Republicans are typically close to corporate lobbyists, and thus fond of special tax breaks for big business.
If Smith walks the walk he’s talking, that won’t happen this term: “Our priorities have changed,” he said in an interview with Politico. “Our priorities are small business, working-class Americans and farmers over big corporations.”
“These huge companies that get big tax advantages and have very good trade policies that have allowed them to invest billions in China and overlook Americans while they reap all these tax benefits — that’s something we’re going to be looking into,” Smith continued.
It helps that big business explicitly has sided with Democrats in the culture war and idiotically sided with them over Georgia’s voting-reform bill. It helps that Smith’s leaders are really angry that the U.S. Chamber of Commerce — the nation’s largest business lobby — supported Democrats last cycle.
Politico’s piece comes from the tax lobbyists’ point of view. Tax lobbyists are one key reason the tax code is so complicated: Lawmakers, bureaucrats, and Ways and Means staffers tend to cash out and become lobbyists and lawyers, whose value depends on high tax rates and a complex tax code riddled with loopholes.
That’s one reason to doubt Smith will deliver on his promise to change focus: The actual incentives of his staff and other Ways and Means members is not a cleaner, simpler, lower tax code. Also, his talk of helping small business may just mean more tax credits, but ones supposedly targeted at Mom and Pop. (Spoiler alert, such credits will mostly benefit the companies with the most tax lawyers, and that’s never Mom and Pop.)
It’s refreshing to hear a GOP member recognize that big business isn’t an ally of conservatives. It will be surprising if he lives up to that talk.