Over the weekend, several Republicans loudly announced their intention to buck the dominant party orthodoxy on taxes when it comes time to do a deal with President Obama on the fiscal cliff. What’s more, these proud apostates almost all framed their willingness to compromise on taxes with reference to a single man: Grover Norquist.
This is not the first time Norquist’s name has been used as shorthand for conservative tax policy. Even Vice President Biden mentioned Norquist’s name in his debate with former Republican VP contender Paul Ryan as a swipe at the “no new taxes” philosophy. At the time, Biden snapped:
I’ve had it up to here with this notion that 47 percent – it’s about time they take some responsibility here. And instead of signing pledges to Grover Norquist not to ask the wealthiest among us to contribute to bring back the middle class, they should be signing a pledge saying to the middle class we’re going to level the playing field; we’re going to give you a fair shot again; we are going to not repeat the mistakes we made in the past by having a different set of rules for Wall Street and Main Street, making sure that we continue to hemorrhage these tax cuts for the super wealthy. [Emphasis added]
Biden’s disdain isn’t unique. Former President George H. W. Bush has infamously asked “Who the hell is Grover Norquist,” while former Senator Alan Simpson derisively refers to Norquist as “Grover babe,” and fiscal conservative stalwart Tom Coburn seems to have Ronald Reagan’s 11th commandment (“Thou shalt not speak ill of a fellow Republican”) on permanent suspension where Norquist is concerned.
So what’s all the fuss about? The answer lies in Biden’s reference to a “pledge,” and the power that less than a single page worth of text can confer on an organization, to say nothing of its leader.
The Man and the Pledge (What Does It Actually Say?)
For those who don’t know, Grover Norquist is the head of Americans for Tax Reform (ATR), originally a Reagan-era pressure group designed to push through then-President Ronald Reagan’s landmark tax reform. However, the group didn’t go away once it had helped get that passed. Rather, Norquist continued pushing a document the group had devised in 1986 known simply as the “Taxpayer Protection Pledge.” It is this document that is at the root of Norquist’s present day power.
Not that you would know it from reading the pledge itself. For candidates for either Congress or the Senate, it is less than 100 words long. Not 100 pages. Not 100 paragraphs. Not even 100 sentences. Less than 100 words. Yet in this model of economical writing, there is a mountain of nuance. In full, the Senate candidates’ Pledge provides:
I, (Name) pledge to the taxpayers of the state of (State name), and to the American people that I will:
ONE, oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses, and
TWO, oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.
As readers can see, the wording on this document is both abjectly simple and intensely legalistic. Because of this, the pledge is easy to misinterpret, perhaps explaining the tendency of some of its more hysterical critics to portray it as practically Faustian in its capacity to frustrate good governance. In one such instance, ABC’s Matthew Dowd jokingly remarked that “The only good thing about Grover Norquist is he’s named after a character from Sesame Street.“ Presumably, unlike Big Bird, this is one character liberals would shed no tears about firing.
Norquist, of course, studiously denies that the pledge hands him any power at all, or that he even has the authority to enforce it. Rather, he argues that the pledge is made by politicians directly to voters, with ATR as a convenient middle man and educator about what it entails. Thus, politicians framing their willingness to support tax increases as a betrayal of Norquist are, according to Norquist himself, ducking the issue. It’s not him that they’re betraying, it’s their constituents.
Critics of the pledge might reply that this is rather like the Pope telling his critics to blame God rather than him, when he’s the main interpreter of God’s word. And indeed, Norquist’s organization does maintain very tight control over what is and is not allowed under the pledge (there’s even an FAQ about this on their website). However, in the literal words of the pledge, Norquist is correct, even if his organization does take an active hand in informing voters of any deviations. Or not, in the case of former President George H. W. Bush, whose “Read my lips, no new taxes” promise got him in hot water when he went back on it during office, whose loss Norquist enthusiastically cites as one where ATR didn’t send out “so much as a press release”:
In at least one real sense, Norquist is right. It isn’t really his call whether particular politicians lose, if the voters decide that a particular tax increase passes muster with them where it wouldn’t under the pledge. After all, while Norquist can go out of his way to “educate” the voters about any deviations by attacking the people who did deviate that way, in the end it’s up to the voters to decide whether to listen, or if they listen, whether to care.
So Why Buck the Pledge?
Norquist’s diagnosis of his own power may be precisely what’s at the root of his recent troubles with lawmakers, who may have come to the conclusion following the 2012 election that voters are less likely to be tolerant of gridlock over taxes than they are of tax increases. The polling bears this conclusion out, showing an electorate that increasingly wants an austerity-style approach whereby taxes are increased and spending is decreased. Norquist might argue (justifiably) that this kind of approach, especially after such a weak recovery, would be hell on the economy, but at the level of raw politics, this sort of substantive argument could carry very little weight with anxious lawmakers who want to please their constituents. So at the political level, Norquist may be a victim of his own correctness.
However, there is another component that may be less the fault of Norquist himself and more the product of a changing political and economic landscape – specifically, the overriding concern with the debt among voters. Conservatives justifiably pat themselves on the back for making this issue so salient, and indeed, much of the concern over the debt since President Obama took office has been driven by conservative voices, so much so that this year’s Republican National Convention opened with a debt clock.
But there is a downside to this approach as well, especially for anti-tax crusaders like Norquist – namely, that tax cuts can increase deficit spending. This isn’t always the case, given that often lowering taxes can lead to increased revenues due to economic growth, but it does put something of a dent in the two political strategies the pledge is built on – specifically, the idea that Republicans must outmatch Democratic proposals for increased spending with proposals for lower taxes in order to remain viable (sometimes called the Two Santa Claus theory) and the idea that depriving government of revenue necessarily shrinks the government as it runs out of funds (colloquially known as “Starving the Beast”).
However, when voters explicitly tell pollsters that they’re sick to death of both “Santa Clauses” by supporting spending cuts and tax hikes, the Two Santa Claus theory looks a lot less useful, and when debt becomes the driver of government spending, the beast doesn’t so much starve as it finds an alternate food supply.
Kevin Williamson, author of the Exchequer blog at National Review and a fierce fiscal conservative who has nevertheless tangled with Norquist’s organization, says these two facts damage the Pledge’s efficacy.
“The real rate of taxation is the rate of spending: every dollar in outlays is a dollar in taxes. The statutory tax rates determine only whether we will pay those taxes today or pay them with interest in the future,” Williamson told TheBlaze in an email. “I think the pledge has been destructive to the extent that it encourages Republicans to devote energy and political capital to the issue of taxes when they should be dedicating it to the issue of spending. Taxes are a symptom, but spending is the disease.” [Emphasis added]
Williamson’s point is well buttressed by the issue of debt. As he put it in one of his arguments against ATR’s position:
I myself do not favor a VAT [value added tax]; I’m a flat-income-tax guy, myself. But, as I always insist, taxes are secondary. Every dollar you spend is a dollar that has to be raised in taxes, eventually. There is no way around that, Sunshine. You can clap as hard as you want, but Tinkerbell still has to fill out a 1040. Can I imagine a universe in which a VAT is preferable to our current system? Yes, I can. But the problem is not the engineering of the revenue code — it is spendthrift congressmen of both parties.[…]
The evidence speaks for itself: Santa Claus is no fiscal conservative, and no model of responsible governance.
It is most likely thinking like this that has motivated conservatives like Saxby Chambliss to openly announce his willingness to sell Norquist out over the issue of debt, to say nothing of Peter King’s announcement that he cares more about a deal to fix entitlements (the largest drivers of the debt) than about holding fast to the Norquist pledge.
Naturally, Norquist himself has a response to this, and it’s round dismissal. Specifically, Norquist argues that Democrats will never agree to any deal that cuts spending in a serious enough way to compensate for the increased tax revenue, and therefore, suggests that both King and Chambliss are positing hypothetical tax “deals” that can’t possibly happen. As Ramesh Ponnoru put it in a column for Bloomberg earlier this year:
Jeb Bush, Graham and other Republicans who favor a deal that cuts spending and raises taxes are naive, in Norquist’s view. President Ronald Reagan, he notes, came to regret a similar deal he made in the 1982 budget because the spending cuts didn’t materialize. The 1990 deal, Norquist further argues, didn’t keep spending from coming in a little higher than the Congressional Budget Office had projected from 1991 to 1995.
The debt-ceiling deal last year, on the other hand, showed that getting spending cuts without tax increases was possible.
Discussing hypothetical bargains with 10-to-1 spending cuts, in Norquist’s view, is like debating what the best kind of unicorn would be. “Wouldn’t it be nice to have silver-striped unicorns? No one’s offered you 10-to-1!” he says, raising his voice in frustration.
Norquist’s cynicism is understandable, as it’s backed up by a historical record of Democrats promising spending cuts in exchange for tax increases, only to go back on the spending cuts later, even when Republicans controlled the presidency. To many conservatives, the idea that Barack Obama, of all Presidents, would put those sorts of serious cuts on the table when presidents like Ronald Reagan and George H. W. Bush failed to do so probably sounds just as ludicrous.
At the same time, right-leaning critics might argue that it is unclear why Republicans couldn’t drive a similarly treacherous bargain with Democrats, accepting revenue increases in exchange for structural spending cuts, with the intent of reversing the revenue increases later. And if such a “unicorn”-esque deals does get put up by President Obama, it will be interesting to see what Norquist – and his allies in Congress – decides to do. And while such a deal might seem discrediting to Norquist’s absolutism on taxes if it ever passed, it would arguably vindicate his wider strategic vision, in that Republicans refusing to budge on tax increases might actually force Democrats to do the unthinkable, and budge on spending cuts first.
If such a thing happened under normal political circumstances, the Norquist style of politics would be seen as the clear winner. And if the Democrats didn’t budge, or tried to drive a disingenuous bargain, then Norquist himself would be proved right about the realities of budget negotiations yet again. In short, in normal circumstances, Norquist simply cannot lose. But…
Why Norquist Loses Because of the Fiscal Cliff (and the Loophole in the Pledge)
Unfortunately, there is one more wrinkle in the current budget negotiations that may unravel Norquist’s carefully constructed political web, and that is the issue of the fiscal cliff. Originally, the fiscal cliff was intended to be a failsafe that would induce such massive bipartisan terror that it would force negotiators into the room. However, the actual structure of the thing gives one party – the Democrats – a distinct advantage.
Why? To quote liberal columnist Jonathan Chait:
Here is how it will happen. On the morning of November 7, a reelected President Obama will do … nothing. For the next 53 days, nothing. And then, on January 1, 2013, we will all awake to a different, substantially more liberal country. The Bush tax cuts will have disappeared, restoring Clinton-era tax rates and flooding government coffers with revenue to fund its current operations for years to come. The military will be facing dire budget cuts that shake the military-industrial complex to its core. It will be a real-world approximation of the old liberal bumper-sticker fantasy in which schools have all the money they require and the Pentagon needs to hold a bake sale.[…]
The beginning of 2013, when the automatic spending cuts take effect, coincides with the expiration of every penny of the Bush tax cuts. And so, by postponing the fiscal reckoning, Republicans inadvertently scheduled it for the very moment when Obama (should he win reelection) will hold his maximum leverage. Last summer, Obama was pleading with Boehner to give him $800 billion in additional revenue. Come January, he’ll have $5 trillion in higher revenue without doing anything. Since Obama’s own budget proposes to raise only $1.5 trillion in new revenue and trim entitlement spending, he could then offer Republicans a deal that cuts taxes (by, say, a couple trillion dollars), increases military spending, and reduces entitlement spending. In other words, he could offer a right-wing bill—and the end result would be a mix of policies to the left of his own budget, and to the left of the Simpson-Bowles proposal. [Emphasis added]
In other words, if America goes over the fiscal cliff, it’s heads Obama wins, tails the GOP loses.
All very well, one might say, but how does this threaten Norquist? Well, as it happens, the scenario Chait outlines is one of the genuine loopholes in the pledge itself. That is, while candidates cannot vote to increase taxes, they are under no obligation to reinstate tax cuts that have expired. Since the Bush tax cuts cannot be renewed before the end of this year without getting past President Obama’s desk, that means that every pledge signer in Congress could keep their pledge and taxes would still go up if the president decides to let them. Which from his perspective, there’s no reason he shouldn’t, if the GOP won’t play ball.
At this point, not only would a post-fiscal cliff GOP have no leverage against Obama, but if he offered a deal that cut taxes at all, they’d be obliged to support it by virtue of their allegiance to (what else) the Taxpayer Protection Pledge. In short, the logic of the pledge works against the spirit of the pledge, and that is quite arguably a serious problem for Norquist and his allies.
Is there a way out of it? Perhaps, if President Obama cracks under pressure from the GOP before the fiscal cliff ensues. However, it’s far more likely that the GOP will crack and agree to a combination of tax increases and spending cuts.
If this happens, liberals would no doubt crow that this is the end of the Norquist pledge. But in fact, in a perverse twist, this might be the best scenario imaginable for Grover Norquist. After all, if the deal really does cut spending at a higher rate than it cuts taxes, he’ll still have seen a budgetary “unicorn” produced by Democrats being forced to adapt to his hardball tactics.
And if it doesn’t? Norquist will have plenty of voters to “educate” about just how their elected representatives were strong-armed into voting for increased taxes, and no term limit on how long he can do it.