Speaker John Boehner (R-Ohio) and other top Republicans on Wednesday shot down a proposal by a senior GOP lawmaker that the House agree to President Obama’s demand to extend current tax rates for the middle class.
Rep. Tom Cole (R-Okla.), a respected party strategist and former chairman of the National Republican Campaign Committee, became the most prominent House Republican to suggest that the GOP do what has long been unthinkable within the party: lock in the George W. Bush-era tax rates for annual incomes up to $250,000 without simultaneously extending them for top earners.
“I told Tom earlier in our conference meeting that I disagreed with him,” Boehner told reporters after a closed-door meeting of the House Republican Conference. “He’s a wonderful friend of mine and a great supporter of mine. But raising taxes on the so-called top 2 percent – half of those people are small-business owners that pay their taxes through their personal income tax filing every year. The goal here is to grow the economy and to cut spending.
“We’re not going to grow the economy if we raise tax rates on the top two rates,” the Speaker added. “It’ll hurt small businesses. It’ll hurt our economy. That’s why it’s not the right approach. We’ll willing to put revenue on the table as long as we’re not raising rates.”
Inside the meeting, Boehner told Republicans that the party would not abandon small businesses to preserve tax breaks for big ones.
“We won’t be party to is a deal that protects big businesses and preserves special-interest tax breaks while raising tax rates on the small businesses we’re counting on to create jobs," he said, according to a source in the room.
The Senate approved legislation earlier this year to extend only the middle-class rates, but the House passed a separate bill extending all of the Bush-era tax policies.
The Senate bill in itself does not raise taxes, but Republicans have long argued that it would represent a de facto tax increase because it would give away their leverage in pushing to avoid tax hikes on the wealthy.
Cole reiterated his position on Wednesday, after suggesting it to fellow members of the GOP whip team on Tuesday.
Cole said that, if it were up to him, he would hold a vote on extending the tax rates for family incomes under $250,000 a year soon.
“I don’t see any advantage in delay,” Cole told reporters. “I think the appropriate thing is to make sure that places where we know we’re not going to raise taxes, we get those taken care of first. I don’t think that somehow weakens our position in negotiations.”
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Cole said that there were some in the GOP conference who agreed with his view on how to proceed, but that the Republicans were united on seeking to extend all tax rates and restraining entitlements.
And, the Oklahoma Republican added, he thought Boehner would get “tremendously strong” support among Republicans for whatever deal he negotiated on taxes and spending.
“This is not a disagreement about what we want to accomplish,” said Cole, who continued to stress that he wanted to extend all current tax rates. “It’s just a discussion about what the best tactics are.”
The outgoing chairman of the National Republican Congressional Committee, Rep. Pete Sessions (Texas), criticized the idea after the meeting.
“I don’t think there’s any appetite for that position,” he told The Hill. He called Cole a “wise and talented member” of the conference but said tax increases “destroy jobs.”
Sessions said positions on both sides have hardened in recent days. “The president’s solidified his position, and we have, too,” he said.
A senior House conservative, Rep. Scott Garrett (N.J.), called Cole’s suggestion “absurd.”
Rep. Raúl Labrador (R-Idaho), an outspoken freshman conservative, went so far as to suggest that Cole was a member of the Republican establishment that had contributed to the nation's spending problems in the first place.
"I think he's wrong," Labrador said. "I think most of the conference thinks he's wrong. He's a good man, who has served here for a long time, but he is also a man who has voted for a lot of the increased spending in Washington, DC. They are the one's who were here causing all the problems we are facing."
"When the Democrats come to me with a plan to cut spending, I can come to them with a plan to raise taxes," he added.
Another member of the Oklahoma delegation, Rep. Frank Lucas (R), said his fellow Sooner was very wise and was playing “chess” by trying to think through a negotiating strategy, but he said the majority of the caucus would not go along with it.
“It is very well thought out, as are most of Tom's ideas, but I don't know that that reflects the attitude of the conference,” Lucas said. “I think the membership is very focused on the idea of not raising anybody's taxes, with a focus on reducing spending and reforming entitlements.”