Sunday Political Brunch: A Taxing Problem—September 3, 2017
Sunday, September 03, 2017
“What Is Tax Reform?” – Tax reform should not be confused with the much sexier issue of tax cuts. If I am getting a 10 percent tax cut, that’s real money. I can figure out what is going back into my wallet, so it’s an easier sell for Congress and the voting public. But tax reform is more complex, allowing for reconfiguring of tax brackets and items which may or may not remain deductible, such as home mortgage interest. It can be dry stuff, sexy only to lawyers and accountants. Plus, its tangible results are often felt in a matter of years, rather than right away. My point is that Congress could pass tax reform before the end of this year, but it may not be reflected in peoples’ pocketbooks until April 15, 2019. That’s five months after the 2018 election!
“Will I Make More Money?” – For many voters – pardon the pun – this is “the bottom line”! If I make $60,000 per year and my federal taxes are 15 percent, I am paying in $9,000. A tax rate cut to 10 percent will put an extra $3,000 in my pocket every year. That’s easy. But then they talk of reducing or eliminating the home mortgage deduction, or tuition tax credits, and other allowances only an accountant may know about. It gets cloudy and hard to figure what my real savings might be. Tax reform involves a lot of math (clearly the least favorite subject in school for most people.) And if a lot of the tax advantages go to high income earners, many people may be turned off, or at best be indifferent. It’s hard to make tax reform a bumper sticker campaign because of the complexities.
“Past Tax Reforms” – Tax reforms were most notable in the Reagan administration. Just seven months into his first term, he got the first of his tax reforms passed. Income taxes were cut an average of 25 percent over three years, but the federal deficit exploded. Some mid-course corrections were made in 1982, and the economy finally erupted with some of the biggest growth ever recorded. Reagan was easily reelected in a 1984 landslide. The Reagan administration passed another major tax reform bill in 1986, one that simplified the tax code by reducing 15 tax brackets to just four. The Reagan era of economic boom is still highly regarded by many.
“Should This Have Been Done First?” – I am a big believer in having a laundry list of accomplishments as a politician, including hitting a home run on your first at-bat. In 2001, President George W. Bush got a bipartisan education reform bill known as “No Child Left Behind” passed into law by the end of May. It gave him an initial victory. Had I led the Trump White House I would have gotten the infrastructure reform bill through Congress first because both Democrats and Republicans were on board. The Obamacare repeal could have waited, especially when there were early signs it was in big trouble in both the House and Senate.
“Infrastructure” – Just about everyone agrees that the nation’s roads, highways, and bridges are in sad shape. So, what do you do? Look, this is classic pork barrel politics. Investment in infrastructure is something tangible that Washington, D.C., does which is felt in just about every state and Congressional district. First, it puts people back to work, fixing things that just about every driver will tell you need to be fixed. It pumps money into local economies, and produces visible, tangible local results. It helps generate more state income taxes and sales taxes, so it fills state coffers, too. The downside is that the jobs are never permanent; and when the highways are done, many of those workers may be unemployed again. But it can provide a healthy, visible short-term spike in the economy.
“Should Obamacare Have Waited?” -- This is a tough question. In hindsight, many people say “yes.” I think the proponents of repealing and replacing Obamacare misread the tea leaves, when they thought repeal would be easy. Here’s the dynamic: The GOP-led House and Senate had voted many times to repeal Obamacare, knowing full well that President Obama would veto it. It was an easy vote. But fast-forward to 2017, and states such as West Virginia were faced with the prospect of pushing 200,000 people off the health care rolls in one of the poorest states in the nation. Suddenly, a repeal vote was not as easy to make. That was the case for many lawmakers in states that are struggling. Good research would have pointed this out last spring; but, instead, wishful thinking became an illogical political guide.
“What Have You Done for Me Lately?” – President Trump has been feuding with his top economic advisor, Gary Cohn, since Cohn was publicly critical of the President’s response to the violence in Charlottesville. Cohn told The Financial Times, “The administration can and must do better in consistently and unequivocally condemning" hate groups. Many observers believe Cohn is the linchpin of passing tax reform, and Trump would be hard pressed without him.
“Defending the President; Defending My Seat?” – A big quandary for many Republicans in Congress will be: “Do I defend my own record, or do I have to defend the President’s record, too?” As I have pointed out here often, almost all House Republicans won their seats on their own, without the President’s help. On the other hand, the Republican Senate majority owes its continuation of power directly to Trump’s coattails, as he helped carry key seats in North Carolina, Pennsylvania, and Wisconsin. But those three Republicans are safe, as they aren’t up for reelection until 2022. I predict most Congressional Republicans will simply run on their own records and keep their distance from the White House.
What would you change about our tax system or tax code? Just click the comment button at www.MarkCurtisMedia.com.
Mark Curtis Ed.D., is Chief Political Reporter for the five Nexstar Media TV stations serving West Virginia, including viewership in Ohio, Kentucky, Virginia, Maryland, Pennsylvania, and Washington, D.C.
Related Slideshow: The Power List - Politics, 2016
Kate Coyne-McCoy - In baseball, they call them all around superstars - five tool athletes.
McCoy, who once ran for Congress, is a strong political organizer for EMILY’s List, a proven fundraiser for Raimondo’s PAC, strong with the media, and is a top lobbyist.
She is manages to balance being a partisan with her all-around effectiveness. McCoy can do it all.
Lenny Lopes - Whether you’re looking for someone to navigate the halls of the State House, manage your public relations image, or execute a contract, Lopes can do it all.
The affable and well-liked former Chief of Staff to then-Attorney General Patrick Lynch (and prior to that, Legal Counsel to Lt. Governor Charlie Fogarty) had joined forces with Pannone Lopes Devereaux & West before striking out on his own with The Victor Group, taking on such heavyweight clients as Lifespan and online gaming behemoths Fanduel and DraftKings, and more niche healthcare accounts — including the medical marijuana Rhode Island Growers Coalition.
Lopes was tapped this past spring following the tourism debacle by Havas PR to help navigate their way through the Rhode Island waters, and ultimately defend their performance and reputation to stave off their contract cancelation for now. If you’re hired to be a PR firm’s de facto PR brain, you must be on your game.
Two Coast Operative
Matt Lopes - With more than 20 different lobbying agreement Lopes has emerged as a premiere influencer in Rhode Island. His clients range from Dunkin’ Donuts to Amgen to the Rhode Island Airport Corporation.
While managing one of the biggest lobbying practices he is often on the West Coast -- he is a nationally recognized Special Master for the U.S. District Court for the Eastern District of California, overseeing prison reform and compliance.
He plays with the big boys on both coasts. Easy for a guy who was a star athlete in high school and at Dartmouth.
Don Sweitzer - IGT (formerly GTECH) super lobbyist plays the game at most every level, with big ties to the Clinton organization that go all the way back to Sweitzer playing a key role with Clinton-Gore in 1992.
Sweitzer’s contacts span the political spectrum - despite his Democratic pedigree, don’t count him out if Donald Trump wins the Presidency as Sweitzer worked for Paul Manafort back in the early 1990s.
Reportedly, Raimondo asked him to serve as her chief of staff - he gracefully declined.
Segal, Bell and Regunberg - These three young Brown grads are emerging as the leaders in progressive causes in Rhode Island and across the United States. David Segal, who served on the City Council in Providence and as a State Rep, failed in a 2010 effort for Congress losing to David Cicilline in the Democratic primary.
In 2016, Segal along with Aaron Regunberg emerged as a powerful force in trying to kill of the Super-Delegate structure in the Democratic primary.
Sam Bell is leading a major effort to re-calibrate the Democratic party to the left the election season. We will know just how good Bell is after September 13’s Democratic primary - Bell is overseeing more than a dozen progressive candidates' campaigns.
Goldberg, Walsh, Ryan and Murphy - These four veteran lobbyists know the pass codes to just about every private office in the State House. For decades they have been the go-to guys. Regardless of who is in power Bob Goldberg, Joe Walsh, Mike Ryan and Bill Murphy are always in vogue.
Only Ryan was not an elected official. Murphy ran the House for a decade, Goldberg had pulled off one of the greatest political coups when he lead a small band of GOP senators and split the Dems to take power, and Walsh was the almost Governor of Rhode Island in 1984.
Combined, they have the lion's share of premier clients and have collected the millions in fees to prove it.
Nicole Pollock - The new Chief-of-Staff for Providence Mayor Jorge Elorza certainly has big shoes to fill, with the recent departure of both Chief Operating Officer Brett Smiley and outgoing Chief of Staff Tony Simon but Pollack has gotten off to a strong start. Following the recent summit on Kennedy Plaza co-hosted former Mayor Joe Paolino and Elorza, Paolino told GoLocal, “[Elorza’s] new Chief of Staff, I’m very impressed with.”
Pollock had joined the administration in February 2015 as Chief Innovation Officer and then served as Chief of Policy and Innovation for the administration before being tapped for the top post. Pollock had previously served in a policy and communications role for the Rhode Island Department of Environmental Management. A graduate of Brown University, Pollock currently serves on the Board of the West Broadway Neighborhood Association and the Providence Plan.
The city has no shortage of pressing issues to tackle, from devising a plan to handle the ongoing panhandling, homelessness, and drug use issues in Kennedy Plaza, to the ever-looming issue of the protracted legal battle with the Providence Firefighters that could have monumental financial implications for the city, depending on the outcome.
Matt Bucci - The up-and-comer on Governor Raimondo’s staff was in the mix for Chief of Staff or another promotion this summer, but may chose to take his skills and join the world of lobbying or grab another private sector position.
Made news when he was tied to Governor Raimondo’s ill fated and ultimately canceled trip to Davos Switzerland. Raimondo was going to spend a weekend with the beautiful people and raided the non-profit URI Foundation’s scholarship dollars to fund the trip.
The former staffer to Senator Jack Reed is widely respected. Look for news about Bucci in the near future. Too talented to not make a leap soon.
Chris Hunter - The strategy wunderkind has morphed into a well-established operative in his own right in veteran lobbyist Frank McMahon’s public affairs shop, Advocacy Solutions.
The long-time government and public relations manager for the Providence Working Waterfront Alliance, Hunter is equally adept at the State House, having snagged emerging industry client Lyft and engaged in the hand-to-hand combat that comes with lobbying for the Rhode Island League of Charter Schools.
Election seasons in particular are where Hunter’s know-how comes in handy, having managed a number of successful bond referendum in the state. Hunter is a constant presence networking around town, whether it’s hobnobbing with the Providence Committee on Foreign Relations or serving on host committees for key candidates - he’s the combination of both “who you know” and “what you know."
Nick Hemond - None may be more unabashedly and relentlessly ambitious than Hemond, who landed as an associate at powerhouse DarrowEverett in 2014.
The President of the Providence School Board lobbies at City Hall for high-profile real estate clients including Buff Chace and High Rock Management (i.e. the ownership of the Superman Building) and at the State House for labor interests (RI FOP, RI Carpenters Local Union 94), Big Health (the Hospital Association of Rhode Island) and rounding it out with such interests as AAA, the Hospital Association of Rhode Island, and infrastructure firm AECOM.
If that doesn’t sound like a full load, toss in a slew of crisis communications clients in the way of bars and clubs in varying degrees of trouble (read: stabbings, shootings) before the Providence Board of Licenses. Having so many fingers in so many pies (and some of which could appear somewhat conflicting) has raised eyebrows, but in the meantime if Hemond is winning, the checks keep coming.
Leo Skenyon - The seasoned political operative is the man behind the man. Serving as Chief of Staff to Speaker of the House Nicholas Mattiello, Skenyon helped navigate a more than treacherous legislative session which saw Finance Chair Representative Ray Gallison resign, Representative John Carnevale found ineligible to run at his purported address in Providence, and a slew of financial and ethics issues for a number of Democrats.
The Speaker however emerged from the session having tackled the thorny issue of community service grants, and what had seemed up until this year a nearly impossible task, putting ethics reform — and oversight of the Assembly by the Ethics Commission — before voters this November.
Skenyon has weathered many a political season before, having been the former Chief of Staff to then-Senate Majority Leader Jack Revens in the 1980s, and then a former top aide to Governor Bruce Sundlun and U.S. Senator Claiborne Pell. Now, his boss faces both a Republican and Independent challenger in the general election in November.
Joe Shekarchi - The Chair of the House Labor Committee is running unopposed this year in District 23 in Warwick, marking just the third election season for the powerful politician-lawyer, who first won in 2012.
Given his fundraising prowess, however, one would think that Shekarchi accrued his war chest over a longer tenure, with over $528,000 cash on hand as of the second quarter of 2016, making him far and away the most flush General Assembly member (by way of comparison, Speaker of the House Nicholas Mattiello reported just over $365,000 cash on hand for the same period; Governor Gina Raimondo had $1.4 million.)
It was managing money that helped establish him on the map as a seasoned statewide political operative — he was the campaign manager for statewide operations for Raimondo when she ran for General Treasurer in 2010. With a number of successes in business and on the Hill, keep an eye on Shekarchi's future plans.
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