So Much for the Camp Plan, or, the Plutocrats Roll Over the Populists Again

Jonathan Chait checks in on the disappearance of the latest Republican tax reform plan:

When House Ways and Means Committee Chairman Dave Camp released his tax-reform proposal a few weeks ago, Republicans reacted coolly, but none quite matched the sheer ballistic hostility of the financial industry. What set off Wall Street was a tax Camp levied on the largest banks. Their size made them “too big to fail,” thus lending them an unfair advantage, which Camp proposed, with shocking rationality, to recoup. The banks, predictably, do not see things this way. Wall Street unleashed a furious campaign to destroy and isolate Camp, canceling all fundraisers for the party until his fellow members agreed to denounce his heresy.

And now Wall Street’s efforts have borne fruit. The Wall Street Journal reports today that more than 50 House Republicans have sent a letter to Camp assailing his financial tax, which they call “arbitrary” and say “threatens our economic vitality by reducing access to credit, curbing economic growth, and worsening our nation’s unacceptably high unemployment rate.” Terms like “arbitrary” and “reducing access to credit” are Wall Street’s ways of saying that anything that reduces the profitability of large financial institutions is unfair and harmful.

So there will be, once again, no real tax reform. And Camp's plan actually did all the things that Republicans say they want, reducing rates by closing loopholes, keeping revenue the same but not shifting the burden downward. But its failure is ok with the moneyed interests opposing Camp's plan:

“The Camp draft catalyzed most of the business community around the notion that it was so bad, and it’s not just private equity and financial services — there were so many other punitive measures in there — that people just decided, the whole system’s broken here, nothing’s going to get done,” another senior Republican business leader said. “And that’s what we need to work toward. We need to work toward gridlock.”

One day Republican voters just may wake up and realize that the plutocrats are using them.