Debt, elections prod GOP to ease anti-tax stance

[November 18, 2011]  WASHINGTON (AP) -- The GOP's image as a rigidly anti-tax party is softening. Spurred by federal debt worries in Congress, the shift conceivably could reshape the Republican Party's brand ahead of the 2012 elections, forcing tough decisions by its presidential candidates.

Some of the party's staunchest fiscal conservatives have surprised colleagues by saying targeted tax hikes are acceptable if they lead Democrats to accept deep government spending cuts.

Whether or not Congress' deficit-reduction talks succeed, the Republicans' offer has touched off a debate unlikely to end soon. The altered stance would upend party orthodoxy, which holds that deficits should be tamed entirely by spending cuts, with no tax increases.

In recent months, growing numbers of Republican lawmakers and strategists have grown wary of the no-exceptions position. They fear independent voters will abandon the GOP next year if it seems too rigid and beholden to tea partyers. They also worry that another deficit-reduction impasse will further erode Congress' image, and House Republicans might be handy election targets.

Some of those Republicans hope Democrats will agree to a deal that would include cuts to Medicare and, eventually, Social Security. Such a bargain might protect Republicans from so-called "Mediscare" attacks next fall, based on their embrace of an earlier GOP budget plan that would privatize and shrink Medicare for future beneficiaries.

Publicly, Republican lawmakers say they are motivated by the dire need to curb the deficit and reassure financial markets that the government can tax and spend responsibly.

Rep. Charles Bass, R-N.H., recently told NPR that he might renege on his pledge to oppose higher taxes, even if it hurts him politically. Bass said he also pledged to "defend America against enemies, both domestic and foreign. And I consider the debt crisis in this country to be a real threat to the future of America."

The Republican tax-hike overture has turned heads largely because its sponsors rank among Washington's best-known critics of tax increases. Sen. Pat Toomey of Pennsylvania is a former head of the conservative Club for Growth. Backers of his plan include Rep. Jeb Hensarling, R-Texas, who holds similar stature among fiscal conservatives.

Both are members of the 12-person bipartisan "supercommittee" tasked with reaching a debt-reduction deal by next week.

Toomey's plan would raise $300 billion in new tax revenues while overhauling the federal tax code. Republican officials say it would drop the top tax rate on personal income to 28 percent from the current 35 percent. It would reduce or eliminate some well-known itemized deductions and reduce the corporate tax rate.

The plan also would extend the Bush-era tax cuts, now set to expire at the end of next year. Most Democrats oppose that idea. It also would trim cost-of-living increases for Social Security recipients.

House Speaker John Boehner is among several top Republicans who have blessed Toomey's plan. Those avoiding a public position so far include House Majority Leader Eric Cantor of Virginia and Senate Minority Leader Mitch McConnell of Kentucky.

"The significance of someone as conservative as Senator Toomey putting forward a plan with revenue raisers cannot be overstated as proof of the willingness on our side to find a compromise solution," said Kyle Downey, spokesman for Sen. John Thune, R-S.D.

But congressional Democrats have not accepted Toomey's offer. They have called for greater revenue increases, and different priorities for spending cuts.

If the supercommittee fails to reach a $1.2 trillion deficit-cutting deal by Wednesday, automatic spending cuts totaling that amount would take effect beginning in 2013.

Republican presidential candidates have given varied responses to Toomey's tax overture.

"The contours that I'm hearing about are very similar to the program that I've put out," former Utah Gov. Jon Huntsman told reporters in New Hampshire. If the plan phases out tax loopholes and deductions, lowers income tax rates, broadens the base and simplifies the code, "it's something that I could be in favor of," he said.

Former Massachusetts Gov. Mitt Romney has avoided direct comment on Toomey's plan. A campaign spokeswoman said Romney "does not believe that more revenues and tax increases are the answer to our fiscal woes."

Texas Gov. Rick Perry "wants to look at details, but if those details include a tax increase, he's not going to be for it," a spokesman said.

Former House Speaker Newt Gingrich has denounced the supercommittee process rather than the Toomey plan itself. "Secret negotiations among a handful of members will lead to a gigantic bill no one understands," Gingrich said Thursday.

At an Aug. 11 presidential debate, just before Perry entered the race, all those attending said they would reject a deficit-reduction plan if it included $10 in spending cuts for every $1 in new revenues.

Support for Toomey's plan, whether it bears fruit or not, suggests many Republican officials are more open to compromise. But hardly all.

Several conservative activists lambasted Toomey's plan, predicting a voter backlash if it becomes law. Radio talk show host Hugh Hewitt called it "an enormous breach of faith with the voters" who put Republicans back in control of the House in the 2010 elections.

A conservative Arizona website, Seeing Red AZ, called Toomey's move stunning. It said Toomey, "long a conservative icon, presents a disappointing caricature as he crosses the line by supporting this tax increase."

Other conservative Republicans, however, say Toomey's effort is a savvy approach that might gather momentum.

"Republicans are starting to think, whether right or not, that the first party to walk away from some or all of its orthodoxy to make a deal is going to reap a pretty significant benefit with the public," said Republican lobbyist Mike McKenna. "If you can bring in some new revenue and open up the discussion of entitlement reform, that's a political win and a policy win."

Several Republicans said Grover Norquist, the best-known anti-tax-hike activist, has lost clout in recent months. Norquist says an adamant stand against tax increases is vital to the Republican Party's brand, even if Democrats are willing to make deep spending cuts in return.

Numerous Republicans have openly defied Norquist lately.

Rep. Frank Wolf of Virginia criticized him on a range of issues in a House floor speech last month. "Have we really reached a point where one person's demand for ideological purity is paralyzing Congress to the point that even a discussion of tax reform is viewed as breaking a no-tax pledge?" Wolf asked.

Boehner raised eyebrows recently when he referred to Norquist, a feared figure in some political circles, as "some random person."

[Associated Press; By CHARLES BABINGTON]

Associated Press writers Steve Peoples in New Hampshire, Mike Glover in Iowa and David Espo in Washington contributed to this report.

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