Timid White House Agenda Recipe for Disaster

As year two of President George W. Bush’s second term dawns, predictably, efforts to make him a lame duck are well advanced, efforts apparently abetted by well-meaning but misguided White House aides.

Last week, the Washington Post characterized the president’s plans for comprehensive tax reform as "dead or comatose" when it revealed conversations with White House insiders who claim Bush has decided that "overarching initiatives such as restructuring Social Security are unworkable in a time of war." Thus, the Post proclaimed, "No one in the White House expects the (State of the Union) speech to include anything of the magnitude of Social Security (reform)."

"Instead of home runs," an unnamed aide said, "Bush will focus on hitting singles and doubles."

The Post also quoted conservative "activist" Grover Norquist as claiming, "The lesson from this year is you cannot do anything dramatic unless you have 60 votes (in the Senate)."

This web of pessimism has spread to London, where in the Daily Telegraph quoted Rep. Fred Upton, R-Mich., as saying, "The White House has realized it had too ambitious an agenda and is re-tooling as we speak." The Telegraph quotes Upton as telling the Los Angeles Times in the aftermath of a "brainstorming session" with Karl Rove that the White House is "looking at what is achievable, versus the grand big picture."

With this attitude Republicans might as well go fishing. If the GOP doesn’t have a bold domestic agenda carried by a confident president during the upcoming midterm elections, not only will it transform a vigorous president into a lame duck, it could forfeit its congressional majority. Far from having to worry about finding 60 votes in the Senate, Republicans could end up without 51.

I prefer football metaphors, but because the White House aide speaks in baseball, here goes: Bush is behind going into the middle innings of his second term. There is time to catch up but the president won’t be able to do it by swinging for singles, coaxing bases on balls, bunting and stealing home. He needs to field a heavy hitter that can reach the fences, i.e., tax reform that simplifies the code and lowers rates on labor and capital.

The belief that tax reform is too grand and visionary to top the domestic agenda, while wrong, is understandable. The president’s ill-advised Advisory Panel on Federal Tax Reform recently recommended that individual and corporate income taxes should be left in place regardless of their steeply progressive rate schedules and top marginal rates in excess of 30 percent. Were the president to follow that advice, tax reform would indeed go the way of his failed Social Security reform for exactly the same reasons: His outside advisory groups in both cases misunderstood what needs to be done. Handicapped by their use of static analysis, they tinkered timidly rather than reforming boldly.

It’s not surprising that one pessimistic adviser the Telegraph quoted is the Cato Institute’s Michael Tanner, who took leave from Cato to advise the President’s Social Security Commission: "Another adviser summoned to the (recent White House) meetings (Tanner) said the chances of resuscitating a battered administration were very limited. "This is an exhausted administration. It’s going to be very hard for (them) to come out with a big new initiative.’"

Ugh, what pessimism!

Where tax reform differs dramatically from Social Security reform is that the Democrats will be unable to stonewall it the way they did Social Security reform. One can feel the palpable urgency among Democrats to "fix" the Alternative Minimum Tax, which is raising taxes every year on rich and upper-middle-class Democrats.

Doing nothing on taxes is unthinkable for Democrats. That’s why shortsighted proposals by some Republicans to "fix" the Alternative Minimum Tax (a bunt) rather than replacing the Internal Revenue Code with something entirely different (a home run) would kill a presidential rally. If Republicans give Democrats the only tax cut they’ve clamored for in decades yet fail to provide fundamental and comprehensive tax reform, the GOP will be passing up the opportunity of a lifetime.

The next time a reporter asks the president to identify a mistake he has made, I hope he answers, "I made two: Creating those stupid commissions/advisory panels on Social Security and Tax Reform. I knew what needed to be done; I didn’t need a bunch of technocrats and former members of Congress, now lobbyists, to tell me. Rather than providing me the best advice on the details of how to get done what we all know needs to get done, I allowed myself to become hostage to the technocrats and lobbyists. I’m done with that, and that’s why I’m proposing that Congress hitch up its britches and get to work enacting fundamental and comprehensive tax reform and simplification before I leave office."