The news that two Republican legislators said they will abandon Grover Norquist’s No tax Pledge in order to secure a compromise to the threat of the nation falling off the “fiscal cliff” before the end of the year has everyone in a tizzy.
When we discussed this in my American Government class this week, one of my students asked, “Professor Schmidt, who the hell is Grover Norquist?” and several wondered why someone they’ve never heard about would have such enormous power over the entire Republican Party.
As you and I know, he’s an American lobbyist and conservative activist who founded Americans for Tax Reform (ATR) whose "Taxpayer Protection Pledge" was signed by 95 percent of Republican Members of Congress. Most GOP candidates for president have signed the pledge, which commits them to oppose increases in marginal income tax rates for individuals and businesses. The pledge also commits them to oppose any "reductions or elimination of deductions and credits without a matching reduced tax rate."
The pledge is now 20 years old and polls show that if anything, it is a burden on Republicans as the nation struggles to preserve very, VERY popular programs such as Medicare, Social Security, and Medicaid as well as Veterans benefits and programs that are moving into revenue deficits. Selected tax increases and reform of many tax deductions and credits is seen as absolutely critical to strengthen these programs as well as, of course, reform many federal programs.
Norquist has scared Republican politicians into fearing any tax increases as career-ending, which can stimulate actions such as Tea Party challenges to any Republican who does not sign or violates the pledge.
Since Americans for Tax Reform is not required to disclose the identity of its contributors, it is essentially a well-funded secret society that has successfully shaped national policy on taxes and spending without anyone knowing who is behind the organization’s objectives. Of course, rumors have it that corporations and wealthy folks, i.e. “Romney Americans,” are the principal supporters of ATR.
I tried to explain all this to a group of European journalists and literally none of them could grasp how a country like the United States could concede so much power to an individual who is not elected, who holds no official positions, and who is fueled by secret money.
Now, raising taxes on upper income Americans may no longer be the taboo that Republicans have feared. As a newspaper in Wichita, the Kansas Eagle puts it,
"56 percent of Americans support ending the Bush tax cuts for those making more than $250,000, while 39 percent favor continuing the cuts for everyone. Meanwhile, exit polling in eight swing states also showed even more support for ending the tax cuts for the wealthy, ranging from 57 percent in Florida and Ohio to 64 percent in Nevada and Wisconsin."
This would, of course, remove a major and seemingly insurmountable hurdle to finding a solution to the looming revenue-spending game of chicken we have been playing. These new poll numbers and attitude changes may force the GOP to reprogram and refocus its ideological premise that taxes are bad.
As I’ve indicated many times, countries with some of then highest marginal tax rates in the world are also among the highest in quality of life – think Switzerland, Germany, Norway, New Zealand, Sweden, Canada, Denmark, Australia, Austria, and the Netherlands, which are ranked at the top in that order. All of these have individual tax rates over 50 percent.
So the question this week is “Will Grover Norquist need to find different employment now that Americans have turned against the “No New Taxes” mantra?”