By Russell Berman and Bernie Becker - 08/04/13 10:00 AM EDT
The Republican Party has flipped the script on Democrats by waging a populist assault against President Obama’s recent moves on healthcare and tax reform.
Democrats have long portrayed themselves as the defenders of average citizens in their bids for higher taxes on Wall Street and big business.
But GOP lawmakers now say they are the ones defending the “little guy” against an Obama administration beholden to corporate interests.
They’ve adopted a similar criticism of Obama’s “grand bargain” offer for overhauling the corporate tax code.
“President Obama said he's interested in tax reform for corporations — but not for families or small businesses. Once again, the president is playing favorites,” the House GOP budget chief, Rep. Paul Ryan (Wis.), wrote in an op-ed for USA Today.
“The president claims his economic agenda is for the middle class. But it's actually for the well-connected,” Ryan wrote.
If the Wall Street vs. Main Street rhetoric has a familiar ring, it’s because Obama himself used it to win reelection last year — a connection not lost on both Republicans and Democrats in Congress.
“It is kind of almost humorous how it sounds like Republicans are using liberal talking points of the emotional-driven message that businesses get off the hook, but you don’t,” freshman Rep. Trey Radel (R-Fla.) said. “But it’s reality. It is what it is.”
The big difference is in the policies. Obama and congressional Democrats have long used populist arguments to push for higher taxes on the wealthy and capital gains, and in calling for the elimination of tax breaks for oil and gas companies.
Republican leaders have opposed the policies, although they are considering scrapping some breaks in a revenue-neutral overhaul of the tax code.
“They’re so identified with special interests. They’ve been the party of small interests,” said Rep. Sandy Levin (Mich.), the top Democrat on the tax-writing House Ways and Means Committee. “And for them now to say they’re worried about the little person, the regular person, the small business people, it’s not credible. So they can keep on saying it, but no one’s going to believe it.”
The Michigan Democrat also accused Republicans — a party that he said “has blindly hugged large business” — of “populism run wild.”
“The record shows: We’re the ones who have been devoted to small business and individuals,” Levin said.
Republican lawmakers say their populist argument is unique to the specific policies they are criticizing.
“I don’t think it’s messaging, but I also don’t think it’s a shift either,” said Rep. James Lankford (R-Okla.), chairman of the Republican Policy Committee. “We’ve talked about tax reform for everybody for the three years that I’ve been here. I don’t remember a time that we’ve just talked about just business tax reform and just corporation tax reform.”
“I don’t feel like we’ve changed messages on it,” he added. “While I’m very confident the Democrats have done a better job messaging this whole populist thing, that’s where we’ve been the entire time on it.”
The GOP message also reflects the pull of newer members who ran against both big government and Wall Street.
“Overall I do have a tendency to have a little populist streak in me,” second-term Rep. Morgan Griffith (R-Va.) said. “A libertarian streak with a little dose of populism is never a bad thing in my opinion.”
The debate over business taxes and breaks is returning as Congress considers a full rewrite of the corporate and individual code. Republicans say those specific provisions should be examined only in the context of comprehensive reform.
GOP lawmakers said that there are good policy reasons for keeping capital gains rates low — something, they say, that can allow for more investment in small businesses.
But GOP tax writers have also said that they’ve made no final decisions about how to treat a wide variety of provisions in a rewritten code. Instead, Republicans in the House have set a broad goal of reducing the top corporate and individual rates to 25 percent.
Ways and Means Chairman Dave Camp (R-Mich.) said his panel would look at taxing capital gains and dividends at the same rate as ordinary income. Camp told committee members this week that he wants to mark up a tax reform bill before the debt ceiling needs to be raised, something Treasury projects will have to happen before November.
“We're certainly going to look at that,” Camp told Bloomberg Television. “Obviously, I think the goal is, how do we get families in a better position? First, how do we get a simpler, fairer, flatter tax code? And one of the things that's driving Americans crazy is the complexity of this tax code.”
Rep. Charles Boustany (R-La.), another senior Ways and Means member, said Republicans’ line of attack against Democrats and the administration was fair.
“That’s not friendly to American families and small businesses. That’s choosing corporate America,” Boustany said.