GOP Mounts Offensive to Sell Its Tax Cut Plan

WASHINGTON — Congressional Republicans have set off on a mission that should be a cakewalk: building popular support for their massive $792-billion tax cut plan. But with polls showing many voters blase--at best--about the tax issue, the GOP effort more precisely resembles a blitzkrieg.

House and Senate Republicans plan more than 600 town hall meetings around the country during their August recess to showcase the tax cut, which cleared Congress late last week. Legions of lawmakers will be dispatched to talk radio shows to tout the measure, which President Clinton has promised to veto once it is sent to him. Some are signing on to the Internet for online tax chats.

Yet the mere fact that the party is mobilizing such an aggressive sales job to promote its priority speaks volumes about the public’s current view of tax cuts. Besotted by economic prosperity, cynical about politics in general, voters do not seem to be clamoring for big tax cuts the way they did in the late 1970s in California and elsewhere, many pollsters and politicians say.

In short, this is not your father’s Proposition 13.

“The Republicans have their work cut out for them,” said Andrew Kohut, director of the Washington-based Pew Research Center for the People and the Press. “Damn few people have been paying a lot of attention [to the tax debate in Congress]. It just doesn’t have a lot of resonance now because taxes generally are not a high priority item for voters.”

Many Republicans voice confidence that the public will sit up and take notice once they hear the party’s message. The GOP lawmakers plan to stress that--with the federal budget surplus projected to grow to $1 trillion over the next decade, not counting the revenue set aside for Social Security--it’s only fair that most of the money be returned to taxpayers. The Republicans also intend to detail how families would benefit from the GOP tax cut.

“A tax cut is not particularly high on the public’s agenda,” said Glen Bolger, a GOP pollster. “However, people do favor strongly individual elements of the tax cut” bill, which includes provisions slashing tax rates on income, inheritances and capital gains during the next 10 years.

Other Republicans concede that the issue is less pressing to voters because of a booming economy. In such good times, they said, people are less likely to notice that they are paying more taxes--measured as a share of the national economy--than at any time since World War II.

“This is going to be a challenge,” said Rep. Christopher Shays (R-Conn.). “I will have Republicans, Democrats and independents who will want to know why I’m cutting their taxes.”

For some voters, analysts said, a jaundiced view of government and mistrust of promises from Washington color their view of the tax cut bill.

“Most people think they are more likely to get hit by lightning than they are to get a tax cut,” said Ed Gillespie, a GOP political consultant.

The Republicans also will have to contend with return fire from Democrats. Taking their cue from Clinton, Democratic lawmakers can be expected to blast the GOP proposal as fiscally irresponsible. And they will press the White House call for using most of the surplus to reform Medicare, improve other social programs and reduce the national debt.

Some Republicans seem downright proud of their decision to push for a tax cut without a big boost from the grass roots. “It may not be the single most popular thing, but we know it is the right thing,” said Rep. David Dreier (R-San Dimas).

Such comments underscore how different the political and economic climate is now compared to the last time Congress passed a big tax cut--1981. The three-year, 30% cut in income tax rates proposed by the Reagan administration was driven in part by the grass-roots anti-tax fervor of the late 1970s that produced Proposition 13, California’s seminal initiative that cut property taxes.

In those days, an angry public grappled with tax rates that reached as high as 70%, a tax code that allowed rampant inflation to push people into higher brackets and an economy in which double-digit inflation and interest rates sapped purchasing power.

Now, of course, inflation is negligible and interest rates remain in the single digits and relatively stable. And thanks to the 1981 tax cut itself, which indexed federal tax brackets, taxpayers are no longer tormented by bracket creep.

So while many people--when asked specifically by pollsters--will agree that their taxes are too high, the topic lacks the crusade quality it once had. There is no Howard Jarvis--Proposition 13’s famed proponent--out there sparking a political movement around the issue.

A survey for the Wall Street Journal in late July, when congressional debate on tax cuts was at full tilt, found that, when asked what problems facing the nation concern them most, only 9% said high taxes. Four other issues topped that: breakdown of the family (32%), Social Security and Medicare (17%), poor public schools (15%) and crime and drug use (13%).

Another late July poll for ABC News found that the congressional debate had not moved public opinion on the best use of the emerging federal budget surplus: Almost 8 in 10 surveyed had higher priorities for the money than tax cuts, such as saving Social Security. That’s about the same result as when the network conducted a poll four months earlier.

The most controversial part of the GOP tax cut, even among Republicans in Congress, was the initial proposal to cut all income tax rates by 10%. More broadly accepted were targeted tax relief measures, such as cutting the estate tax or reducing the so-called marriage penalty.

By contrast, the engine that propelled the 1981 tax cut was its across-the-board cut in income tax rates. Return money to all taxpayers, the supply-side theory went, and they will inject it into a then-stagnant economy. But this pro-growth argument packs little punch at a time when the economy already is purring along.

“A tax cut doesn’t automatically come to the top in times of prosperity unless you keep talking about it,” said Rep. Thomas M. Davis (R-Va.), chairman of the GOP congressional campaign committee.

Which is precisely why Republicans have mounted their August public relations drive. “We hope to give ourselves the best opportunity to inform the American people what the tax bill actually does,” said Rep. Bill Archer (R-Texas), chairman of the House Ways and Means Committee.

GOP leaders have disseminated “talking points” on the virtues of the tax cut so the party will be singing from the same song sheet. They have coordinated events nationwide to focus on one tax-related theme each week. They are even putting up a special Web site that tracks the various activities.

In California, Rep. Doug Ose (R-Sacramento) will be touting the tax cut in speeches he has scheduled throughout his district. Rep. Gary G. Miller (R-Diamond Bar) has lined up appearances on talk radio programs.

Toward the end of the month, House Speaker J. Dennis Hastert (R-Ill.) intends to visit California, at a site yet to be determined, to deliver what his aides hope will be a well-covered speech on taxes.

“The American people don’t know all the things that are in this package,” says John Feehery, Hastert’s spokesman. “Education is the most important thing we can do, so the American people know what the president is going to veto.”

As the GOP lawmakers put the final touches on their plans, Clinton reiterated his veto pledge in strong terms. “If I can stop it, I will,” he said Sunday.

Senate Majority Leader Trent Lott (R-Miss.) said he hopes the month’s activities will create enough public support to cause the president to reverse himself.

Few expect that to happen. Even so, the GOP’s public relations blitz may have the salutary political effect of rallying their party’s base behind an issue that unites them--and is unlikely to offend swing voters.

As Gillespie, the Republican consultant, put it, “No one ever lost a seat in Congress by cutting taxes.”

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Tax Cut Proposal

As congressional Republicans fan out across the country to pitch their $792 billion tax-cut plan, one objection they will face is that the proposal is skewed toward the most affluent taxpayers. An analysis by the nationally known accounting firm Deloitte & Touche found that the plan does provide the wealthiest families with most of the benefits when the cuts are viewed in absolute terms. However, families with more modest incomes see significant benefits when the cuts are measured as the percentage by which current tax burdens are reduced.

For families of four with two children under 17

Family Income: $35,000

Tax Cuts in Absolute Terms: $364

% Reduction of Personal Tax Bill: 24%

Family Income: $50,000

Tax Cuts in Absolute Terms: $265

% Reduction of Personal Tax Bill: 9%

Family Income: $75,000

Tax Cuts in Absolute Terms: $1,091

% Reduction of Personal Tax Bill: 16%

Family Income: $100,000

Tax Cuts in Absolute Terms: $1,819

% Reduction of Personal Tax Bill: 15%

Family Income: $200,000

Tax Cuts in Absolute Terms: $2,720

% Reduction of Personal Tax Bill: 7%

Family Income: $1,000,000

Tax Cuts in Absolute Terms: $9,861

% Reduction of Personal Tax Bill: 3%

Figures are based on full phase-in of tax plan after 10 years.

Source: Deloitte & Touche.