Trump’s Last Ditch Drive To Salvage His Tax Bill In Congress

Trump's tax billTrump at the White House

The Obamacare fiasco taught Mr Trump that securing an overall majority in Congress fails to provide him with a winning hand when sensitive issues are at stake. He wrongly thought he could scrap his predecessor’s heritage in medical insurance by exerting pressure only on the Republican camp.

Now he faces a similar challenge to his headline electoral promise to axe taxes. His pledge to undertake a sweeping change in fiscal rules and procedures, aimed at simplifying and enhancing economic performance, have passed largely unnoticed. His dubious rhetoric roused huge suspicions about his ultimate goal: ensuring those better-off paid less, including big corporations. All his efforts to allay such distrust have failed completely.

To make matters worse, the Republicans loitered around the idea of imposing heavy import duties to raise extra income, an initiative Paul Ryan has managed to curb amid widespread concern in the business community. They now face the incredibly tough task of matching the figures. Should their reform bring about a noticeable imbalance in public finances, it would prove short-lived, falling under the automatic sunset clause applicable in such cases.

Mr Trump has decided to cajole the Democrats this time round by calling on them to support the bill. Who is likely to oppose measures supporting domestic activity and jobs? Who would dare to dump moves to make life easier for taxpayers? Who could refuse a rebate for the badly scarred middle-class? There is a straightforward answer, which will certainly hit the target. All those, be it Democrats or trade unionists, who believe such flamboyant promises are nothing more than a bait for carrying out a complete tax overhaul to the benefit of the rich and the detriment of others.

Aware of the severe difficulties facing his proposal, Mr Trump has launched a nation-wide campaign in an attempt to salvage it. And time is running out for Congress. After deciding to totally amend the bill, it is proving to be incapable of reaching a minimum consensus on its shape and content. Nervousness is increasing among businesses, the current uncertainty curtailing investment and merger plans. The economy is taking a heavy toll as the stalemate turns increasingly unbreakable.

Even if the blame mainly lies with the Republicans in Congress, should Mr Trump fail in this capital endeavour, his whole political agenda would fall apart. He better use the Mexican palisade as his private Wailing Wall and prepare himself for the worst to come.

About the Author

JP Marin Arrese
Juan Pedro Marín Arrese is a Madrid-based economic analyst and observer. He regularly publishes articles in the Spanish leading financial newspaper 'Expansión'.