Skip to main content
Part of complete coverage from

Here's something Congress could actually do

By Julian Zelizer, CNN Contributor
November 25, 2013 -- Updated 1254 GMT (2054 HKT)
CHICAGO - NOVEMBER 1: Current federal tax forms are distributed at the offices of the Internal Revenue Service November 1, 2005 in Chicago, Illinois. A presidential panel today recommended a complete overhaul of virtually every tax law for individuals and businesses. (Photo Illustration by Scott Olson/Getty Images)
CHICAGO - NOVEMBER 1: Current federal tax forms are distributed at the offices of the Internal Revenue Service November 1, 2005 in Chicago, Illinois. A presidential panel today recommended a complete overhaul of virtually every tax law for individuals and businesses. (Photo Illustration by Scott Olson/Getty Images)
STORY HIGHLIGHTS
  • Julian Zelizer: Sen. Max Baucus' proposed to reform taxes isn't as crazy as it sounds
  • He says Congress has reasons to want to reach agreement on tax reform
  • Both parties would gain some credibility with public that feel Congress can't do anything, he says
  • Zelizer: A deal on taxes would help cut deficit, close loopholes

Editor's note: Julian Zelizer is a professor of history and public affairs at Princeton University. He is the author of "Jimmy Carter" and "Governing America."

(CNN) -- On the surface, Montana Senator Max Baucus's proposal to reform the corporate tax code seems politically insane. The powerful chairman of the Senate Finance Committee has proposed tightening up the tax treatment of corporate profits overseas. The Senator, along with legislators in both parties, wants to use this proposal as the basis for broader loophole-closing reforms that also tackle the individual tax code.

Given how difficult it has been to pass any piece of legislation in recent years, it seems impossible that Congress will muster the energy or courage to challenge powerful interest groups that benefit from the status quo and to reform the tax code.

While loophole-closing tax reform might be good policy, it is hard to see how it can be good politics. "This is a big rock to push up the hill," warned Oregon Democrat Ron Wyden.

Julian Zelizer
Julian Zelizer

But in fact there is reason to believe that tax reform might have a chance to pass. The proposal comes at a good time. Congress is stuck in the mud. As an institution, Congress needs a big victory. Polls show that the approval ratings of Congress have reached all-time lows, now having fallen to an abysmal nine percent.

Although members of Congress tend to focus on their own electoral future, the public image of Congress has reached such a low point that the leaders of both parties are seriously concerned.

When public disapproval of the institution is so strong, it creates the environment for a possible "throw the bums" out atmosphere in which all parties are at risk for an anti-incumbent election.

Nothing can boost the image of Congress as an institution like a reform that benefits the public interest over private interests. Although achieving tax reform is extraordinarily difficult, Democrats and Republicans could walk away from a deal looking as if they were finally willing to take on the status quo in Washington and to defy the powerful interest groups who lurk on K Street. This might be enough to bolster public attitudes about the House and Senate going into the next couple of election cycles.

If Congress gores enough oxen, with both parties equally implicated in the reform, members could insulate themselves from the fallout—preventing one party from using this as an issue against the other--and strengthen their standing with the electorate as a result.

Both parties also stand to benefit from tax reform because it remains one of the best ways to raise revenue without raising taxes. One of the reasons that tax reform has always attracted the interest of fiscal conservatives is that cleaning up the tax code of its loopholes quickly raises more revenue.

Most fiscal conservatives understand that serious deficit reduction is only possible through a combination of tax hikes and spending cuts.

Although the United States has maintained a progressive tax code since 1913, few upper income individuals or corporations pay the actual higher rates since loopholes diminish their obligations. Occasionally, such as in 1969 and 1986, Congress has closed loopholes as a way to raise more money to curb the deficit.

Unlike 1986, this time the legislation would not be revenue neutral. The amount of money raised by closing loopholes would be more than the money saved by taxpayers enjoying lower rates, and that money could be used to help shrink the deficit. That could enable the grand bargain over deficit reduction that Democrats and Republicans have been unsuccessfully pursuing for years.

As occurred when Ronald Reagan was president in 1986, tax reform was an issue that both parties had an incentive to support. For unpopular Republicans, tax reform can offer evidence that the party is committed to fiscal responsibility and demonstrate that they are capable of governance.

Passage of the legislation would offer a contrast to the image that the party gained when it used the debt ceiling to try to force President Obama's hand on spending cuts. For Democrats, tax reform can shift the national agenda away from the problems with the roll out of the Affordable Care Act and toward a legislative accomplishment.

Finally, tax reforms can be one of the first tests of the post-filibuster reform Congress. The Senate voted to prevent filibusters on executive and judicial nominations. They did so through a majority vote, establishing for the first time that a majority was sufficient to change the rules.

Many experts predict that this precedent might scare senators from using the filibuster as much as in recent years, fearing that the tool might be eliminated altogether. It is thus possible that tax reform would now only require 51, rather than 60, votes in the Senate.

President Obama could desperately use a victory like tax reform. As the chances for passing immigration reform diminish, and the possibilities of achieving progress on climate change are nil, tax reform might be one of the few areas where progress is possible.

Ronald Reagan scored a big victory in 1986, one that remains a noted part of his record and legacy. Unfortunately, over time new loopholes were created and there is a need for another around of reform. The president should seize the moment, to make sure that his second term is not solely defined by the bitter partisan battles over the budget and health care.

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of Julian Zelizer.

ADVERTISEMENT
Part of complete coverage on
April 18, 2014 -- Updated 1311 GMT (2111 HKT)
John Sutter: Bad news, guys -- the pangolin we adopted is missing.
April 18, 2014 -- Updated 1252 GMT (2052 HKT)
Ben Wildavsky says we need a better way to determine whether colleges are turning out graduates with superior education and abilities.
April 18, 2014 -- Updated 1026 GMT (1826 HKT)
Charles Maclin, program manager working on the search and recovery of Malaysia Flight 370, explains how it works.
April 18, 2014 -- Updated 1250 GMT (2050 HKT)
Jill Koyama says Michael Bloomberg is right to tackle gun violence, but we need to go beyond piecemeal state legislation.
April 17, 2014 -- Updated 1845 GMT (0245 HKT)
Michael Bloomberg and Shannon Watts say Americans are ready for sensible gun laws, but politicians are cowed by the NRA. Everytown for Gun Safety will prove the NRA is not that powerful.
April 17, 2014 -- Updated 1328 GMT (2128 HKT)
Ruben Navarrette says Steve Israel is right: Some Republicans encourage anti-Latino prejudice. But that kind of bias is not limited to the GOP.
April 16, 2014 -- Updated 2323 GMT (0723 HKT)
Peggy Drexler counts the ways Phyllis Schlafly's argument that lower pay for women helps them nab a husband is ridiculous.
April 16, 2014 -- Updated 1642 GMT (0042 HKT)
Rick McGahey says Rep. Paul Ryan is signaling his presidential ambitions by appealing to hard core Republican values
April 16, 2014 -- Updated 1539 GMT (2339 HKT)
Paul Saffo says current Google Glasses are doomed to become eBay collectibles, but they are only the leading edge of a surge in wearable tech that will change our lives
April 15, 2014 -- Updated 1849 GMT (0249 HKT)
Kathleen Blee says the KKK and white power or neo-Nazi groups give haters the purpose and urgency to use violence.
April 16, 2014 -- Updated 1156 GMT (1956 HKT)
Sen. Sheldon Whitehouse and Rep. Henry Waxman say read deep, and you'll see the federal Keystone pipeline report spells out the pipeline is bad news
April 16, 2014 -- Updated 1153 GMT (1953 HKT)
Frida Ghitis says President Obama needs to stop making empty threats against Russia and consider other options
April 15, 2014 -- Updated 2129 GMT (0529 HKT)
Peter Bergen and David Sterman say the Kansas Jewish Center killings are part of a string of lethal violence in the U.S. that outstrips al Qaeda-influenced attacks. Why don't we pay more attention?
April 14, 2014 -- Updated 1156 GMT (1956 HKT)
Most adults make the mistakes of hitting the snooze button and of checking emails first thing in the morning, writes Mel Robbins
April 14, 2014 -- Updated 1754 GMT (0154 HKT)
David Wheeler says as middle-class careers continue to disappear, we need a monthly cash payment to everyone
ADVERTISEMENT