The Trump Agenda Short Article: Ryan

Issue: The Trump Agenda

Short Article: Ryan Charts Own Path in House

By: Mark Silva

Pub. Date: November 21, 2016 Access Date: September 25, 2021 DOI: 10.1177/237455680223.n5 Source URL: http://businessresearcher.sagepub.com/sbr-1775-101275-2762504/20161121/short-article-ryan-charts-own-path-in-house ©2021 SAGE Publishing, Inc. All Rights Reserved. ©2021 SAGE Publishing, Inc. All Rights Reserved. Speaker’s agenda focuses on tax cuts Executive Summary

House Speaker Paul Ryan has his own ideas about what policy priorities should be pursued when Republicans take full control in Washington next year. Most revolve around reducing taxes. A key takeaway: Ryan wants to reduce business taxes to 20 percent, tax only profits earned in the U.S. and allow earnings parked overseas to be brought home at an 8.75 percent rate. Full Article

House Speaker Paul Ryan will be the second-highest ranking Republican in Washington next year. An advocate of making politics “a battle of ideas, not insults,” he has his own carefully articulated legislative agenda. 1 And he made it clear late in the 2016 election season, when he announced that he would no longer stump for Republican presidential nominee Donald J. Trump’s then-troubled campaign, that he was focused on saving the Republican House majority. He succeeded— helped by the same voting tide that lifted Trump to victory. The speaker’s relationship with the new president could be fraught, considering his lack of outright support for Trump’s campaign. Ryan quickly sought reconciliation. At a news conference the morning after Election Day, Ryan said he had spoken with Trump “about the work ahead of us and the importance of bringing this country together.” He credited Trump with helping Republican congressional candidates and added: “I think our relationship is fine.” 2

House Speaker Paul Ryan meets with President-elect Donald J. Trump (left) and Vice President-elect Mike Pence (right) shortly after the Nov. 8 election.

Ryan’s plans call for a new tax code that is “fair and simple for everyone—so simple that most Americans can do their taxes on a form as simple as a postcard.” He proposes to consolidate the seven personal income tax brackets to three and lower the top individual tax rate to 33 percent from 39.6 percent. He wants to repeal the estate tax.

Two additional proposals, which Ryan says will create jobs and raise wages, are to establish a separate, lower tax rate of 25 percent for small businesses and allow families and individuals to deduct 50 percent of dividends, capital gains and interest from their taxes. And he wants to cut the top nominal corporate tax rate from 35 percent to 20 percent. 3 Ryan and House Ways and Means Committee Chairman Kevin Brady, a Texas Republican, have advanced a comprehensive tax plan that also addresses the problem of corporate inversions compelling American firms to keep $2 trillion in earnings overseas. 4 U.S.-based multinationals would be subject to U.S. tax only on income generated within the United States, as opposed to their worldwide earnings, and at the lowered rate of 20 percent. Accumulated foreign earnings held in cash that have been kept overseas to avert taxation could be brought home—“repatriated”—at a rate of 8.75 percent. 5 With Trump in the White House, Ryan and Brady could have unfettered rein to move forward with a tax plan that the new president basically endorses. “Ryan and Brady will be driving the bus on that,” says Scott Hodge, president of the Tax Foundation, a Washington-based think tank that studies tax policies. “Their plan is very thoughtful, well developed, solves a lot of the problems.” The House has made many attempts to repeal all or parts of President Obama’s signature achievement, the Patient Protection and Affordable Care Act. 6 The measures never passed in the Senate, and if they had, the president would have vetoed them. Trump’s election greatly increases the prospects for reversing “Obamacare,” although the Democratic minority in the Senate could try to block it. And Trump, in a postelection interview with The Wall Street Journal, said he would consider leaving in place two elements of the act: a prohibition on insurers denying coverage because of pre-existing conditions and a provision allowing children to remain on their parents’ policies until age 26. 7 Ryan and Trump must bridge significant differences on trade policy. The incoming president has called for repeal of accords such as the North American Free Trade Agreement that was initiated in 1994. Ryan suggests instead that the United States should “work on improving and not talk about withdrawing [from] it.” 8 Trump has strongly opposed the Trans-Pacific Partnership trade agreement that the Obama administration struck with 11 other nations; Ryan, while praising liberalized trade in general, declined to bring the accord up for a vote in the House this year and called for parts of it to be renegotiated. 9 Ryan has held a firm grip on a strong GOP majority, which could quell any potential revolt against his leadership from members of the tea party caucus. Entering the elections, his party held a 59-seat advantage in the House, its biggest in eight decades. 10 The party lost about six seats to Democrats. One week after Election Day, House Republicans unanimously nominated Ryan for another term as speaker in a voice vote, forgoing any balloting that would indicate how many internal opponents he might have. 11 About the Author

Mark Silva is an assistant managing editor at U.S. News & World Report. He has covered U.S. presidential election campaigns since 1992 for the Miami Herald, Chicago Tribune and Bloomberg News. Notes

[1] Jennifer Steinhauer, “Paul Ryan Addresses Political Clashes, But Not Congressional Gridlock,” The New York Times, March 23, 2016, http://tinyurl.com/zds2t5s. [2] Lauren Hodges, “GOP Leaders Make Peace With Trump In Favor Of ‘Unified Republican Government,’ NPR, Nov. 9, 2016, http://tinyurl.com/ow5257g. [3] Kelsey Snell, “Ryan rolls out sweeping tax cut proposals as part of election-year agenda,” The Washington Post, June 24, 2016, http://tinyurl.com/z2zjnmt; Steinhauer, op. cit. [4] Ralph Benko, “Speaker Paul Ryan And Chairman Kevin Brady Produce A Tax Blueprint To Make America Great Again,” Forbes, July 10, 2016, http://tinyurl.com/otoa2nb. [5] Howard Gleckman, “Ryan Proposes Big Tax Cuts for Business and Investors, Moves Towards a Cash Flow Tax,” Tax Policy Center, June 23, 2016, http://tinyurl.com/jesanzb. [6] Deirdre Walsh, “House sends Obamacare repeal bill to White House,” CNN, Jan. 6, 2016, http://tinyurl.com/jhbbkb4. [7] Monica Langley and Gerard Baker, “Donald Trump, in Exclusive Interview, Tells WSJ He Is Willing to Keep Parts of Obama Health Law,” The Wall Street Journal, Nov. 11, 2016, http://tinyurl.com/jblpsg3. [8] Ronald Brownstein, “Is the GOP Donald Trump’s Party – or Paul Ryan’s?” The Atlantic, Oct. 6, 2016, http://tinyurl.com/o7zdsyx. [9] Susan Cornwell, “House Speaker Ryan: No point in lame duck vote on TPP deal,” Reuters, Aug. 4, 2016, http://tinyurl.com/gtqd6u3. [10] “Party Divisions of the House of Representatives,” History, Art & Archives, U.S. House of Representatives, http://tinyurl.com/ck3x8pb.

[11] Emmarie Heutteman, “Republicans Again Choose Paul Ryan as House Speaker,” The New York Times, Nov. 15, 2016, http://tinyurl.com/jq8qrxh.

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