On January 4, CNN's "Late Edition" hosted a debate between the sponsors of two tax reform bills. House Majority Leader Dick Armey (R-Texas) made the case for a flat tax. His opponent, House Deputy Majority Whip Billy Tauzin (R-La.), made the case for a national sales tax. "Billy and I believe that we have the opportunity to go talk to the American people, let them sort out their feelings about the matter," said Armey. "We're willing to settle this matter in an open, public debate."
CNN's panel of pundits listened to the two congressmen, then chewed over the merits of their proposals. Both would eliminate taxes on inheritance and capital gains, and would also reduce the tax rate on the rich. "Everybody likes a flat tax" except for the loss of cherished deductions, conceded New York Daily News columnist Steve Roberts. Critics of the bills were "looking at the trees, not the forest," argued USA Today Washington bureau chief Susan Page. "People don't accept the current system. They want some kind of change."
Thus ended another rave-winning performance of the "Scrap the Code" debates, one of the cleverest acts on the political circuit. The congressmen toured eight cities last fall and will cover dozens more this year. Reporters following the tour continue to scrutinize and compare the two tax plans, missing the point. The crucial question in a debate isn't who wins; it's what gets considered. By framing the national discussion of tax reform as a contest of Republican ideas, Armey and Tauzin are skillfully pushing it to the right.
The tour was conceived last year, when congressional Republicans were bickering over whether to propose a flat tax or a sales tax. Polls suggested the public wasn't ready for either, and House Speaker Newt Gingrich refused to elevate the issue until his troops reached a consensus. Then the Republicans came up with a bright idea: Settle the fight out in the open. Ordinarily, that's foolish. But Gingrich saw advantages in it. A debate tour would test-market the two tax plans, resolving which, if either, the party should embrace. Republicans could also boastas Gingrich eventually didthat they're soliciting public feedback, unlike Democrats who tried to "cram" national health insurance "down people's throats."
Gingrich also recognized a third advantage. "Tax reform becomes our answer to campaign finance reform," he told the New York Times. If lobbyists are the roaches in the nation's kitchen, he reasoned, tax breaks are the food scraps that attract them. Flattening the tax code gets rid of the scraps, and therefore the roaches.
The "debate" has been engineered to promote a common message. Before the tour, Armey and Tauzin rehearsed their act before a focus group in Maryland. Pollster Frank Luntz coached them to project unity by sitting near each other onstage. At every stop, they denounce the current tax code and praise each other's ideas. In case the audience somehow misses the message, Citizens for a Sound Economy, the conservative interest group whose foundation is sponsoring the tour, hands out "Scrap the Code" T-shirts and paraphernalia.
CSE also gives the debates an impressive nonpartisan veneer. In Dallas, it enlisted Texas Rep. Ralph Hall, the only Democrat who has signed CSE's flat-tax pledge, as an introductory speaker. Better yet, CSE recruits journalists as moderators. The Statehouse bureau chief of the Ohio News Network moderated the first debate in Ohio; the news director of a Phoenix radio station moderated a later debate in Arizona. "Typically we pick a local newsperson," explains Armey's press secretary, Jim Wilkinson. "We try to pick someone who is seen by the community as crediblenot a politician."
The press can't resist. A Republican congressman speaking against taxes is a dog-bites-man story. Two Republican congressmen debating each other sounds more like dog-bites-dog. By the time local reporters show up and discover that it's really dog-licks-dog or two-dogs-bite-man, it's too late to back out. The tour's recent performance in Louisiana, for example, aired statewide on public television.
National journalists mention that the debates aren't really adversarial, but readers notice only the headline and the two ideas under discussion. "With an implicit wink, the two men used much of their two-hour debate for a common purpose," winked the Times in its report on the tour's Atlanta performance, before going on to quote Armey, Tauzin, and other Republicans for 24 paragraphs. The "Late Edition" disclaimers were equally irrelevant. What matters is that the flat tax and sales tax got 20 minutes of free national airtime.
Who's winning the debates? Remember that the real fight is two dogs vs. man. In this fight, the dogs are winning. As CSE Foundation president Paul Beckner put it recently, "The verdict from the audience in favor of scrapping the code was a unanimous 'yes.'"
That doesn't mean CSE loves both dogs equally. It favors the flat tax. So why is it spending $15,000 to $75,000 per debate, rather than funding an Armey speaking tour? "We were brought along to be sort of a sideshow," admits Ken Johnson, Tauzin's spokesman. CSE would have liked Armey to go solo, he says, "but it's difficult to generate a lot of publicity when you're out there debating yourself."
Plus, the sales tax makes the flat tax look moderate by comparison. At the debates, right-wing audience members denounce the flat-tax plan because it doesn't abolish the IRS. Armey, in turn, patiently explains that the government must somehow collect taxes. He comes off as the voice of reason.
The flat-taxers have also fostered this image of reasonableness by concealing alternatives on their left. Last year, House Minority Leader Dick Gephardt (D-Mo.) asked to join the tour. He, too, wants to eliminate many tax breaks, but unlike the Republicans, he wants to maintain higher tax rates on the rich. Armey turned him down, explaining that CSE would accept only single-rate tax plans. Tauzin suggests that Gephardt's plan isn't real tax reform because it's too complicated. Actually, it's quite simpleproving that you can clean up the tax code without lowering rates on the rich. That's why the Republicans are excluding it.
President Clinton's strategists dismiss the GOP's tax reform campaign. So do many liberal pundits and congressional Democrats. They argue that the GOP doesn't have enough votes to pass a flat tax or a sales tax, and that Gingrich has retreated to the less ambitious project of cutting taxes within the current system. They boast that Clinton has co-opted the GOP's tax-bashing by curtailing the power of the IRS (after Republicans staged embarrassing hearings) and by offering tax cuts for college and other favored expenses.
They're missing the big picture. Clinton, the rootless tactician, follows the polls and gravitates to the center. Gingrich, the ideologue, pushes the envelope. By extending the mainstream of tax reform to ideas once regarded as right-wing quackery, the Armey-Tauzin tour moves the whole frame of reference. The center shifts to the right, and Clinton with it.
If Democrats want to start driving this conversation, they need their own dialogue. A progressive tax reform debate would be a good place to start.
William Saletan is a Mother Jones contributing writer. His book on the politics of abortion is forthcoming from the University of California Press.