The GOP Is Accepting An Ethanol Tax Credit
The pork pile is growing in the Senate, and Politico now reports that it includes an ethanol tax credit to get Tom Harkin’s vote. The GOP is throwing away its credibility on spending. And ethanol may be the pork line in the sand that even Fred Barnes of the Weekly Standard won’t cross and support.
HH: Joined now by Fred Barnes, executive editor of the Weekly Standard. Fred, what’s your assessment of the deal as it currently stands between the Republicans, President Obama, and the recalcitrant House Democrats?
FB: Well, it’s up to the Democrats either to get it changed, or to go ahead and move, and have a vote in the House. Look, it’ll pass if it’s brought up on the House floor, I think. But at the moment, Nancy Pelosi and the liberal Democrats are saying no. We’re not going to even bring it up. And look, that’s Nancy Pelosi’s call as still the House Speaker. So you know, you would think that at the end of the day, they would go along with their President, at least to the point of bringing it up on the floor. And then most of the liberals would vote against it. But it would still pass. But we haven’t reached that point, yet. They’re demanding changes in it. Look, any changes would have to be approved by Republicans as well.
HH: Well, at this hour, Fred, Politico is reporting that all sorts of changes are happening in the Senate as the Democrats lay on pork, and the Republicans don’t object.
FB: Well, we’ll have to see what happens there. You know, it’s just hard to tell. My guess would be that the bill will pass both houses. It may have some additional parts to it. It would be too bad to have pork. Look, the Democrats, one of their complaints about it is that this hugely increases the deficit. So now they’re going to spend more, have more pork in it? And of course they never miss any opportunity to put more pork in, or to have something in the bill, because they do this in every bill, that favors labor unions and tries to make it easier for them to win members, and make it more difficult for companies to stand against that.
HH: Now Fred, I hate this deal. I’ve written extensively about why I hate it, but the biggest problem with it is it is a complete breach of the Pledge To America that was made by the House Republicans in September. They pledged to read the bill, they pledged to do one issue at a time, they pledged to permanently stop all job-killing tax hikes, they pledged to act immediately to reduce spending. How do they recover the credibility with the Tea Parties, who are out denouncing today. Mark Meckler was on Neil Cavuto denouncing the House Republican leadership and the Senate Republicans for doing this. How do they recover their credibility?
FB: They recover their credibility, Hugh, when they are actually in charge. Look, they’re not in charge yet. This is a lame duck session. It may be undemocratic, and I think it is to have a lame duck session at all, but Democrats are in charge of the House, the Senate, and the White House all now. That will change when the House flips over to Republicans in January. But that hasn’t happened yet. And Republicans are fighting to avoid a huge tax increase on exactly the people who invest in the economy, and create economic growth and jobs. You can see why Obama, well, he doesn’t believe in tax cuts, really, but he thinks well, gee, maybe this thing will help the economy, and thus help me get reelected. But look, Congressional Democrats, you know, some people think they’re just faking, they don’t really feel that strongly about it, they don’t really hate rich people. Of course they do. They loathe rich people, even though many of them are rich themselves.
HH: Fred, there’s nothing we can do about changing the Democrats’ minds, but we can insist that Republicans live by certain principles. Let me play for you what Nancy Pelosi had to say last year about Obamacare. Here’s what she said.
NP: But we have to pass the bill so that you can find out what is in it.
HH: You know, that’s what we campaigned on, and yet that’s what we’re doing right now. And we’re doing it not because we’re in the minority, but because we went along with this deal.
FB: Okay, well look, I’m not the spokesman for the Republicans, but Mitch McConnell said that they would get the bill posted, it would be there 72 hours before a vote next week. Now I don’t know how many people are going to read it, but it’ll be there, he said.
HH: Yeah, but he went into a meeting on Friday afternoon, Saturday and Sunday telling people permanent, not talking about raising the death tax, and came out with something completely different. That’s why the Tea Parties are outraged.
FB: Well look, you know how you defend this bill, and the only way I would defend it is? It’s better than the alternative. The alternative is to have a big tax increase. The alternative is to have the death tax cover everybody, all estates over $1 million dollars, and tax them at 55%. I mean, those are the alternatives. There are things in this bill I don’t want, and I do not think at all…I mean, the notion that this is somehow a stimulus package that’s going to stir the economy, you know, Larry Summers, the White House economic advisor who hasn’t left yet, but he does by the end of the month, said if this thing doesn’t pass, that we may have a second recession.
HH: Okay, so believe him. And if the Republicans…
FB: No, no. But what I was going to say is, that what he’s admitting is that the first stimulus didn’t work.
HH: Yeah, he did. And that’s great, too. But imagine for a moment the Republicans say okay, Nancy Pelosi changed the deal, we’re not taking the pork, we’re turning it down. So nothing happens, and taxes go up on January 1st. And on January 4th, the Republicans pass a tax cut out of the House and it goes to the Senate. Can you imagine the Democrats saying no, we will not pass that, after everything the President and Larry Summers has said?
FB: Yes, I can imagine that.
HH: I can’t.
FB: Oh, come on.
HH: No. Joe Manchin comes over, Joe Lieberman comes over. That’s 49. Ben Nelson comes over. That’s 50. And you find me one more Senator out of all those 23 who are up for reelection? It’s reconciliation. It’s not cloture, Fred.
FB: Well, maybe you’re right. But look, I mean, do you want to take that chance?
HH: Yes. I think we’re killing ourselves with the Tea Parties. They’re so mad. They’re spitting mad at the Republicans.
FB: Look, the Republicans are not in charge, and I think this deal…look, why are all the Democrats so mad, all the liberals so mad? Because they think the deal tilts in favor of Republicans and conservatives. I think it does, too. It wouldn’t be my, it’s not my favorite answer, but it’s the best we can do, and the alternative is much worse. And to play around and take some chance that we can do this when we take power in January is just too risky.
HH: Fred, we are in charge of this. We have to own that. The Republicans can stop this. They’re going along with it, and they’re saying, they’re making an argument to the people, we’ve just got to be honest with you, they’re saying that this is the best we can do. And our people, the people who elected this vast new majority are saying no, it’s not the best we could do. I mean, they approve it in the polls, but they don’t approve it, vis-?-vis something that’s better. And it looks like, well, it looks like the Gang of 14. It looks like the immigration bill. It looks like Nancy Pelosi’s rhetoric. I think it’s a disaster.
FB: Look, if I felt that there was a serious chance, or a certainty that they could let the tax increase go into effect, and Republicans when they take over in the first of January could then reverse it successfully, and get it through a Democratic Senate and a Democratic President, I’d be willing to go along with that. But I don’t think that’s possible.
HH: What’s your limit, then, Fred? If you’re advising Mitch McConnell, they’re already up to $150 billion dollars of spending that hasn’t been paid for, they’re already up to 35% on the death tax at $5 million exemption, what’s your limit? How far can they go without having caved completely?
FB: Who, Republicans?
FB: Look, they’re getting…we could argue with this for a long time. Look, I think it’s a close call, but the best they can do is this now. And then they can take on parts of it in the next Congress that begins January 1.
HH: But right now, the Democrats are just layering on right now. At what point to the Republicans say no, we got taken to the cleaners, and that far is too far?
FB: At the moment when taxes are going to be increased.
HH: So anything they want?
FB: No, they didn’t get anything they want.
HH: But right now, they’re adding more. If it’s a quarter, is it $250 billion?
FB: Most of the stuff that, most of the stuff that Obama got were stuff that the Republicans, he was pushing an open door except on extending unemployment insurance.
HH: I know, but right now, the Democrats are adding more. At what point do the Republican…
FB: Well, have they added, they’re talking about adding more. Have they added more yet? Let’s wait and see.
HH: According to Politico, yes. They’ve added ethanol. Ethanol, Fred, we’re voting for ethanol.
FB: Look, if you wind up with that stuff in there, it’s going to be rejected by Republicans.
HH: Well so, is there anything that would make Fred Barnes tell Mitch McConnell don’t do this?
HH: Ehtanol’s in there.
FB: Well, if it’s in there…have they voted on that yet? And it’s in there and he’s agreed to it?
HH: That’s what Politico says. Tom Harkin is coming over because of ethanol.
FB: Oh, geez, who needs Tom Harkin?
HH: Well, that’s what I’m…Fred, they’ve…
FB: Okay, look, if they do that…
HH: We just won Fred Barnes.
FB: It’s going to get many…Republicans are not going to go along with ethanol and a whole bunch of other things, I don’t believe. We’ll wait and see.
HH: If they do, will you agree with me it was a bad idea?
HH: If ethanol is in the final bill, will you agree with me this was a disaster?
FB: I will agree with you that it’s a bad idea, and that has to be fought, and you could not have that in this bill.
HH: All right, last question. Don’t Ask, Don’t Tell, is it now dead, dead, dead, the repeal for this year?
FB: Oh, yeah, definitely it’s dead. I mean, the Republicans, look, did something that is not that unpopular. Actually, the polls show that it is more popular than not, and Republicans opposed it. So why would they go along with it later? Look, who knows? They may have a separate vote just on that, and then we’ll see. I think they’re afraid they lose some Democrats on a vote like that. And so I think it’s dead for the year.
HH: Fred Barnes, always a pleasure, we’ll talk to you again next week. And I’m holding you to that, Fred. If ethanol’s in there, you’re going to join the anti-sellout crowd. And it’s going to have…I think I’ve lost Guy Beltway Benson already, but we can hold onto Fred Barnes. Thank you, Fred.
End of interview.