Entries Tagged as 'Americans For Tax Reform'

Watch: O’Donnell Loses Temper with Norquist

July 28th, 2011 at 10:01 am 20 Comments

Lawrence O’Donnell yells at Grover Norquist, president of Americans for Tax Reform, over the debt ceiling on MSNBC‘s Morning Joe.

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Grover Norquist, Alpha Male?

June 18th, 2011 at 9:19 am 12 Comments

J.D. Hamel wrote a great piece here at FrumForum regarding the struggle between Senator Tom Coburn (R-OK) and Americans for Tax Reform President Grover Norquist over the issue of ethanol subsidies.  Norquist is, of course, a longtime fixture on the conservative political scene, so Senator Coburn’s public rebuke of Norquist’s position has gotten a lot of attention.  While the legislative and policy points are well-discussed by Hamel and others, I noticed this rather crass little bit of commentary from Norquist, as quoted in an article by Andrew Stiles at National Review and cited by Jonathan Chait at The New Republic:


Norquist says Coburn’s statements after the vote make it clear that his amendment had nothing to do with ethanol subsidies and everything to do with forcing Republicans to go on record supporting a tax increase — essentially a gateway drug that would inevitably lead to additional increases down the road. “He said, ‘Ha ha, popped your cherry, lost your virginity. Now give me $2 trillion in tax increases,’” Norquist says. “As soon as they voted, he turned around and called them sluts. Guys like that didn’t get second dates in high school.”

Now, I’ve never met Senator Coburn or Grover Norquist, and I don’t have much knowledge about their high school or post-high school experiences.  But it is worth pointing out that Senator Coburn is a very much of an Oklahoma boy-made-good, with a successful career in medicine and business before he entered politics, and he is married to a former Miss Oklahoma.  And Grover Norquist is … Grover Norquist.  The reader can draw his or her own conclusions.

Norquist Loses in Ethanol Subsidy Fight

June 17th, 2011 at 12:00 am 21 Comments

The media largely framed the debate over ethanol subsidies between Senator Tom Coburn and Americans for Tax Reform president Grover Norquist as a contrast between two approaches to deficit reduction: Coburn’s pragmatic willingness to raise more revenue on the one hand, treatment and Norquist’s ideologically-rigid opposition to tax increases on the other.

That’s one way to look at it.

But there’s a better way to look at it: Tom Coburn is the ideologically-consistent conservative, and Grover Norquist is a fiscal phony.

It’s worth remembering exactly what ethanol subsidies are. As “tax expenditures” they redirect money from the US Treasury to a particular group — in this case corn farmers — to provide financial incentives for that group to engage in a certain behavior.

These subsidies, in their superficial aim, inevitably work. Corn farmers receive billions of dollars a year to produce ethanol. This reduces the money they spend on producing ethanol, and thus directly increases their profits and encourages them to increase output.

The problem is that like every other tax expenditure, ethanol subsidies are a direct wealth transfer.

As Grover Norquist is undoubtedly aware, taxpayer dollars don’t grow on trees. The money that pays for ethanol subsidies is confiscated from the American public at large. So while the farm lobby benefits from the expenditures, the rest of us lose in the form of higher taxes or increased deficit spending.

To be fair, ethanol proponents argue that the subsidies serve a valuable function — reducing our dependence on foreign energy sources, or decreasing carbon emissions. I find the first of these arguments unpersuasive, while the second is laughably unsupported — it takes lots of carbon emissions to grow corn, and more to turn it into a workable fuel — but I’ll leave the wisdom of ethanol to the side.

The question of subsidies is another matter entirely. Those subsides, like all subsidies, inherently distort the market. Consumers direct resources to the goods and services that most satisfy their desires, but ethanol subsidies forcibly transfer resources from consumers to farmers. Maybe those resources would have gone to savings, or to investment in more profitable ventures. But thanks to ethanol subsidies, they go to agribusiness.

To call the end of these subsidies — a government transfer program — a tax increase is possibly the most un-conservative argument that I have ever heard.

The only difference between an ethanol subsidy and a welfare payment is where the subsidy goes (the business or the poor person) and how it gets there (through the IRS or some other agency). Does the fact that ethanol subsidies are filtered through the IRS make them some sort of tax cut? Of course not.

But maybe if Obama had filtered his multi-trillion dollar health care reform through the tax code, he would have found an unlikely ally in Grover Norquist.

A further problem with Norquist’s position is its apparent ignorance of our deficit. Starve-the-beast economics may have made sense in the 1980s, but after three decades of the doctrine’s failure, conservatives should know one thing: government programs are almost always paid for by higher taxes or more deficit spending.

And what is deficit spending? Yep, a future tax on people like me. So while I appreciate Norquist’s fulmination against tax increases, I’d appreciate it if he’d transfer that passion to the tax increases that will most affect me — those that are coming because “conservatives” like him won’t take the rare opportunity to eliminate a government spending program.

It is uplifting that the gross majority of Senate Republicans broke with Norquist and joined the real conservative in this fight, Sen. Tom Coburn.

Those conservatives apparently realize that every dollar the government spends is a dollar that someone has to pay back. I hope they continue to realize that fact — and continue to ignore the demands of fiscal phonies like Grover Norquist.

Ethanol Vote: Senate Continues To Disappoint

June 15th, 2011 at 8:18 am 12 Comments

The “World’s Greatest Deliberative Body” Tuesday afternoon voted to kill an amendment offered by Sen. Tom Coburn (R-Oklahoma) that would have eliminated the federal subsidy for ethanol.

This action bodes ill for deficit reduction, ask for tax reform, online and for hopes of getting our sovereign debt under control anytime soon. Coburn’s amendment was simple, as was its common sense rationale. Eliminate the 45-cent federal subsidy for ethanol and get rid of the 54-cent tariff on ethanol imported primarily from Brazil.

After all, the subsidy keeps food prices high, adds very little net fuel to the nation’s needs, and, many contend, tends to corrode engines. The tariff is equally outrageous — it increases the cost of ethanol and props up a domestic industry that recent history reveals cannot compete on its own.

The vote was a little disappointing to Coburn supporters, failing on a 49-50 vote. It needed 60 votes to pass under Senate procedure, so the vote wasn’t as close as the numbers suggest.

Contributing to the defeat was the prospect of an amendment authored by Sen. John Thune (R-SD) that would have eliminated the tax break for ethanol, and would have authorized $1.5 billion for ethanol infrastructure. Thune was one of the more vocal opponents of the Coburn amendment, yielding to corn producers in his home state despite his stated desire for serious deficit reduction.

While taxpayers got the short end of the stick once again, at least the 34 Republicans who voted with Coburn stood up to the Americans for Tax Reform (ATF) and its much-discussed taxpayer protection pledge.

Most Republican candidates for federal official sign the document, which ends up allowing them very little room to really attack America’s fiscal problems. Now, with 34 Republicans defying the ATF, the spell may be broken — not one of the 34 will suffer any political damage back home by “violating the pledge.” One hopes that is the end of this particularly pernicious influence on public policy.

One has to ask the Senate this: if you cannot get up the gumption to kill one of the most ill-advised tax loopholes for the few thousand American corn growers, who are already enjoying almost record high prices, how in the world will you ever get enough courage to really take on the other $1 trillion a year in tax loopholes? And without closing loopholes in the tax code, how will you every pass serious tax reform or serious fiscal control?

House Ways and Means Committee Chairman Dave Camp’s spokesman said that the defeat showed that “one-off” attempts to close loopholes will fail. She continued, accurately, to note that the best chance to bring sense to the tax code would be in the context of overall tax reform.

Camp has pledged to bring the subject up legislatively in 2013 and has held a wide-ranging series of hearings so far this year. Yet, the victory of opponents of the ethanol tax break reveals how bloody the battles between favored businesses who enjoy tax loopholes ( much larger than the ethanol subsidy) and taxpayers will be the next several years.

And, while a the “one-at-a-time” approach to closing loopholes may fail, supporters of tax reason and taxpayer relief still must be disappointed in the Coburn defeat and the overwhelming number of Democrats who voted to keep the egregious ethanol break alive.

On the other hand, many of those Democrats voted for ethanol subsidies for the same reason Thune opposed Coburn — to curry favor with farmers back home in front of the 2012 elections. Thus, the Senate continues to disappoint. It acts seldom and when compelled to act, acts badly.

Don’t Forget Norquist’s Abramoff Ties

June 14th, 2011 at 7:17 pm 9 Comments

The Hill today carried a piece observing that Americans for Tax Reform president Grover Norquist has fully overcome his connection to the Abramoff scandal.

The overcoming is apparently so complete that the story does not mention any of the particulars of the connection, consigning the whole incident to the dusty archives. For those who do not remember, here’s a brief reminder of the facts, as related by the final 2006 report by the United States Senate Committee on Indian Affairs:

In late 1999, the Choctaw paid ATR $325,000. In a 2005 interview with The Boston Globe, Norquist said that ATR had sent $300,000 of that $325,000 to Citizens Against Legalized Lottery (“CALL”). Norquist explained that he sent the money to CALL because the Tribe wanted to block gambling competition in Alabama. Out of the Choctaw’s $325,000, ATR apparently kept $25,000 for its services. According to Rogers, Norquist demanded that he receive a management fee for letting ATR be used as a conduit[...]”