“If there’s a closure, it’s just for the Democrats,” Trump said, but Schumer announced he would vote to keep the government open.
WASHINGTON – President Donald Trump met with Republicans on the Senate Finance Committee on the White House on March 13 to discuss a budget proposal that outlines the president’s policy priorities, including an extension of tax cuts.
The meeting came amid the backdrop of ongoing threat of government shutdowns from Senate Democrats and rising discrepancies over budget plans with House Republicans.
The meeting has not been publicly announced, but the White House confirmed that Trump met with committee members after meeting with NATO executive director Mark Latte in the afternoon at the Oval Office.
If lawmakers fail to pass the funding bill by March 14, Congress faces the possibility of government shutdown.
On March 11, the House passed a bill until September 30 to fund the government. The bill increased defence spending by about $6 billion and reduced non-defence spending by about $13 billion. Known as a continuous solution, the measure was passed by a political party vote near 217-213.
Senate Republicans are now demanding Democrats’ votes to move the bill forward. However, some Democrats have opposed the measure, saying they prefer a clean, 30-day government spending bill that funds the government at the existing level rather than a six-month funding measure.
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On March 12, Senate minority leader Chuck Schumer said Democrats didn’t vote for the bill passed in the House and that the GOP is a slim majority and doesn’t have the 60 votes needed to overcome the Senate filibuster. However, just a day later, Schumer announced that he would overturn his position and support the bill to keep the government open. It is expected that more Democrats will be in line with his decision.
“The CR bill is very bad, but the possibility of closure affects America much worse,” Schumer said in a speech on the floor. “We believe allowing Donald Trump to take more power through government shutdowns is a much worse option.”
Before Schumer’s remarks, Trump said the government’s closure would primarily undermine debate over the extension of the 2017 tax cuts and passing his agenda.
“Well, if they shut down, it could ultimately lead to very high taxes,” Trump told reporters during a meeting with Latte. “We’re talking about shutdowns, so we’re talking about working quickly on the biggest tax bill ever passed.”
“If there’s a closure, it’s just for Democrats and they’ll really take a lot away from our country and the people in our country,” the president added.
Extend tax cuts
Tax cuts in 2017 will expire by the end of 2025, and expanding them is a key priority for both the White House and Congressional Republicans. However, there are differences in the House and Senate approaches when it comes to how budget plans are built.
The House plan includes spending cuts to partially offset the impact of tax cuts on the deficit, but the Senate is pursuing a creative accounting approach by adding a “current policy baseline” that allows for changes to the baseline used to measure the impact of the law’s budget from current law to current policy. This dramatically reduces the amount of revenue increase or spending reductions required to offset the extension of the tax cut.
One provision in the House blueprint directed the House Energy and Commerce Committee to cut the deficit by $880 billion. Trump is opposed to Medicaid cuts, and some Senate Republicans have already expressed concern about the proposal, and believe it is likely to remain a competing topic.
Additionally, the Senate budget plan includes an additional $150 billion for the Pentagon, while the House version includes $100 billion.
The House Republican budget proposal would increase the debt cap by $4 trillion. In contrast, the Senate budget framework does not allow increased debt restrictions.
Senate Republicans are moving forward with a two-part plan because the tax portion of the bill takes time to negotiate, while House Republicans prefer an all-in-one package.
A key element of Trump’s economic plan is to extend the 2017 tax cuts that he passed in his first semester. A new US Chamber of Commerce survey shows strong support for a permanent extension of tax cuts, with 64% of voters in favor.
“We are calling for a full and permanent income tax cut,” Trump said during a speech to a joint session in Congress on March 4.
He told Democrats that American voters want to extend the tax cuts and that they must act on that.
“I’m sure you’ll vote for those tax cuts because otherwise I don’t think people will get you in office,” he said. “So I am making a great boon to you by telling it to you.”
Trump has also repeatedly called for tax cuts for companies that manufacture in the US, eliminating taxes on tips, overtime salaries and Social Security benefits.
“I also want to deduct car loan tax-deductible interest, but that’s only if the car is made in the US,” he said on March 4th.
Trump has also announced plans to introduce special tax incentives to help shipbuilders return the industry to the United States. He also vowed to retroactively retroactively deductions for companies that purchase assets such as equipment and machines to January 20th of this year.
