Boehner’s Plan B

House leadership to push for plan making permanent tax cuts for 99.81 percent

December 20, 2012

House GOP leadership will try to implement its so-called "Plan B" for the fiscal cliff on Thursday despite repeated veto threats from the White House, protests from Senate Democrats, and vocal opposition from conservative groups.

House Speaker John Boehner (R., Ohio) said Wednesday the House "will pass" the Republican Plan B—a permanent extension of current tax rates on incomes below $1 million—to provide tax relief for "99.81 percent of the American people."

It then would be left to the Democratic Senate and President Barack Obama to prevent tax rates from going up on everyone in 2013.

"The president will have a decision to make. He can call on Senate Democrats to pass that bill or he can be responsible for the largest tax increase in American history," Boehner told reporters at a brief press conference.

The speaker first proposed the backup option on Tuesday after negotiations with Obama broke down. The plan is nearly identical to one previously championed by leading Democrats such as Sen. Chuck Schumer (D., N.Y.) and House Minority Leader Nancy Pelosi (D., Calif.).

The House will also vote on a measure to restructure the looming spending sequester.

Boehner’s apparent confidence that he has enough Republicans votes to pass the Plan B measure was met with some skepticism.

House Democratic leaders are urging their members to vote against the bill, meaning Boehner can only afford to lose about 20-25 GOP votes. This could prove difficult in the face of opposition from conservative lawmakers and activist groups.

"It’s no secret that this bill is not a final product, but a bargaining tactic to make a larger deal even worse," Andy Roth, Club for Growth vice president of government affairs, wrote in a letter to lawmakers on Wednesday.

Heritage Action reacted similarly and rejected Boehner’s portrayal of the bill as a "net tax cut."

"America’s coming fiscal crisis is a result of overspending, not under-taxing," the group wrote in a statement. "Allowing a tax increase to hit a certain segment of Americans and small businesses is not a solution; it is a political ploy."

Both groups announced they would "score" the vote and urged lawmakers to vote no.

Additionally, the White House and Senate Democrats have made clear the Plan B bill would not pass the Senate, much less the president’s desk.

However, opposition to Boehner’s plan within the GOP is likely overblown. Aides cited significant "momentum" in favor of the proposal over the past 24 hours and echoed the speaker’s confidence that enough Republicans would back the measure.

Conservative opposition notwithstanding, a number of influential figures have given their blessing to Plan B.

House Budget Committee chairman Paul Ryan (R., Wis.), who has been reserved during the fiscal cliff negotiations, offered his support for the measure Wednesday afternoon. Grover Norquist’s Americans for Tax Reform said the group "will not consider a vote for [Plan B] a violation" of its Taxpayer Protection Pledge.

The Joint Committee on Taxation on Wednesday scored the proposal as a net $4 trillion tax cut over the next 10 years. Influential GOP Senators such as Mitch McConnell (R., Ky.), John Cornyn (R., Texas), and Orrin Hatch (R., Utah) also signaled their support.

Democrats’ urging of Boehner to return to the negotiating table in the wake of his proposal indicates they may be concerned that a successful House passage could put them in a difficult spot politically, one GOP leadership aide argued.

"It puts them in a pretty tough position," the aide said. "Is Harry Reid really going to refuse to vote on this? Is the president really not going to sign it? Good luck with that."

Republican momentum regarding Plan B has been driven by a growing acceptance that permanently preserving more than 99 percent of the Bush tax rates would be a considerable achievement, especially with Obama in the White House.

"This is the best possible outcome," said the leadership aide. "This president is the most progressive president in our lifetime, and we’re going to get 99.81 percent of what we want on taxes? Great."

Republicans concede that although Plan B does not address the nation’s spending problem, a looming showdown over the debt ceiling next year will provide an opportunity to do just that.

Boehner has not ruled out a return to negotiations with Obama but said the president needs to "get serious soon about providing and working with us on a balanced approach."