Business vs. GOP

Eduardo Porter at the nytimes has an article out asking if Big Business is losing its clout within the GOP:

From overhauling immigration laws to increasing spending on the nation’s aging infrastructure, big business leaders have seemed relatively powerless lately as theuncompromising Republicans they helped elect have steadfastly opposed some of their core legislative priorities.

Porter goes on to argue that perhaps the influence of highly partisan, (often ultra-wealthy) campaign donors and the reluctance of large companies to spend lots of money in the election process (relative to the total sums of money being spent) have led GOP loyalties elsewhere:

if companies could purchase the Congress of their choice, it’s unlikely they would buy the gridlocked Congress we have. The seemingly inexorable rise of political partisans — mainly on the right, but on the left, too — suggests that corporate money may be playing a much smaller role in the political process than expected.

So I have to say, I think this thesis completely misses what has been probably the significant development in American politics over the last decade or so. While the extreme right wing of elected officials in the GOP might oppose the business establishment on issues of secondary and tertiary importance like immigration and infrastructure spending (really? what [former] Republican advocated infrastructure spending over the last 5 years?), the single most important, really, the ONLY important issue to the GOP right now is tax policy. In that taxes (especially on the wealthy) cannot Cannot CANNOT be raised and, instead, should fall quite dramatically.

Yglesias has been on top of this from the beginning. In his latest, Yglesias inadvertently completely destroys Porter’s argument:

to me the striking thing about American politics today is the extent to which politicians in Congress don’t reach agreements even when the American people aren’t sharply divided. Take the massive, entrenched, years-long dispute over taxes and the federal budget. If you go into the survey data, you find that there absolutely is not a firm partisan divide on this issue. Fifty-six of self-identified Republican voters agree with Barack Obama that deficit reduction should involve both spending cuts and tax increases, and 56 percent of self-identified Democratic voters endorse the view that deficit reduction should be mostly spending cuts.

Leaving aside the economics of grand bargain to reduce the deficit right now (we’ve already harmed the economy more than enough through deficit reduction), the key point here is that 56% of Republicans would raise taxes to reduce the deficit. That is a HUGE number. Why hasn’t a grand bargain been struck (despite more political capital being spent on the issue in the last 3 years than any other)? Because the business community (and the wealthy individuals that comprise it) would absolutely FLIP OUT if their taxes went up even a little!!! To that end, they have spent an enormous amount of time making sure that their representatives in Congress will allow no such thing to happen. If the only way to make that happen is to elect a group of Congressional representatives so opposed to the government doing anything at all that they will oppose completely reasonable proposals like the immigration reform bill being bandied around in Congress, then so be it; the GOP business community is more than happy to take a loss on immigration in order to continue winning on taxes.


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