USA Politics

Sen. Orrin Hatch, Trump's tax reform ally on Capitol Hill

The White House released its plan for tax reform April 26. The issue will test Senator Hatch's 40-plus years as a legislator.

President Trump hands a pen to Sen. Orrin Hatch (R) of Utah after signing an Antiquities Executive Order during a ceremony at the Interior Department in Washington on Wednesday, April, 26, 2017. Senator Hatch, who chairs the Senate Finance Committee, is one of Mr. Trump's indispensable allies on Capitol Hill for tax reform.
Carolyn Kaster/AP
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As Sen. Orrin Hatch of Utah emerged from a Senate floor speech April 24, reporters peppered him about tax reform. While he voiced strong support for President Trump, he doubted his proposed 15 percent corporate tax rate would get through Congress. "You can't very well balance the budget that way."

Then his phone rang.

“Excuse me, the White House is calling me right now, I’ve gotta go,” he said, and stepped into an elevator.

One of President Trump’s indispensable allies on Capitol Hill is Senator Hatch, who dubs the president "a shrewd cookie."

Pretty much everything Mr. Trump cares about runs through the Senate Finance Committee that Hatch chairs: tax reform, infrastructure, trade, and revisions to health care.

“Anyway you slice it, Orrin Hatch will be a key player” for Trump in the Senate, says former Republican Senate majority leader Trent Lott, who praises the Utahn for his experience and “pleasing personality.”

Right now, Hatch is focused on tax reform – an issue “even more complex than health care,” Hatch recently told reporters. It will test his 40-plus years as a legislator.

The White House plan

Hatch has been conferring regularly with the top GOP tax writer in the House, Rep. Kevin Brady of Texas, and with Trump’s tax-writing team, including Treasury Secretary Steven Mnuchin. And he's had long discussions with the president at the White House, where the senator's former chief of staff now works as assistant to the president.

On Wednesday, the White House broadly outlined a proposal for steep tax cuts: a doubling of the standard deduction for individuals and families, and a drop in the corporate tax rate from 35 percent to 15 percent.

Millions of businesses, many of them small businesses that file through the individual tax code, would also be eligible for the 15 percent rate (this is the part that would reportedly help Trump’s real estate empire).

In principle Hatch would love to get business taxes as low as possible. But as he told reporters Monday morning, “I’m not sure he’s going to be able to get away with that” 15 percent proposal because of its effect on the deficit.

Republicans are divided over tax reform. While they generally agree on the president’s broad goals of a simpler tax code, lower business taxes, and a middle-class tax cut, they disagree over details. Especially how to pay for it all.

Internal GOP division over the cost of tax cuts will make passage a steep climb. As with Obamacare repeal, the plan is to use a special budgetary procedure to pass a tax bill with only a majority vote, i.e., only Republican votes.

Republicans have seen how tough that was with their health-care bill. So might they try a more bipartisan strategy with tax reform? That was the road to the last big tax overhaul in 1986.

Another bipartisan tax reform effort?

Despite his deep conservatism and at times strident partisanship, Hatch is known for his bipartisan work – and friendship – with the liberal lion from Massachusetts, the late Sen. Ted Kennedy. Hatch – who is also a songwriter, with gold and platinum albums – even wrote a love song, “Souls Along the Way,” for Kennedy and his wife, Vicki, that featured in the film “Ocean’s Twelve.”

Could this be a Kennedyesque opportunity to come together with the lead Democrat on Hatch’s committee, Sen. Ron Wyden of Oregon? The two have worked well together in the past, for instance, on trade.

“Oh yeah,” Hatch said in an interview earlier this month. “I intend to work with him, and I intend to work with House Democrats as well,” he said, rumbling toward his office on one of the Capitol subway trains. However, he lamented, “I wish we had more Democrats in the House and Senate who [were] more willing to work with us.”

Democrats, however, contend that Republicans have no real interest in working together.

It's not that they can't get along. Senator Wyden, for instance, genuinely likes Hatch. “We’re former basketball players,” says the 6'4" Wyden about his 6'2" colleague. “We like telling stories. He sort of treats me like I’m his kid and I’m very fond of him.”

However – and this is a key complaint of Wyden – for something as serious and difficult as tax reform, Democrats need to be consulted from the “get-go.” When Republicans go off on their own, write the bill they want, and then try to round up some Democrats if they need them, that’s not bipartisanship, Wyden tells the Monitor.

The GOP leadership’s decision to use their majority-only procedure “sends a signal that instead of trying to do something bipartisan, you’re saying ‘our way or the highway,’ ” he says.

Wyden says he has personally told the president that tax reform is better done as a bipartisan effort. In a meeting with Trump about trade, the Oregonian deviated for a minute. “I said one sentence: ‘Mr. President, the history of successful tax reforms are ones where both sides come in early, try to find some principles that they hold dear, that the other side can agree with.’ ”

Democrats, however, are sending their own signal, with Senate minority leader Charles Schumer of New York demanding Trump release his tax returns, otherwise any package of tax cuts will be “much harder to pass.” Democrats want to know exactly how the president would benefit from his own proposal.

In a statement Wednesday, Wyden termed the plan “unprincipled” because it cuts taxes for the 1 percent, involves conflicts-of-interest for Trump, and will cause the national debt to explode.

Reminiscing about Kennedy

Hatch reminisces that it was Kennedy who, early on, came to him. The committees at that time were almost all chaired by southern Democrats who did not have a very high opinion of the senator from Massachusetts – though they did like Hatch.

“Kennedy was wise enough to realize that, ‘Hey, I might be able to get something done with Orrin,’ and as you know, we passed all kinds of important legislation.”

But as Hatch – and other senators on both sides of the aisle – so often comment these days, the Senate isn’t what it used to be.

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