Lawmakers praise tax reform proposals, but skeptical on energy, immigration

thehill.com
By Alexander Bolton
01/25/12 05:40 AM ET

President Obama’s State of the Union address drew a variety of responses from lawmakers who reacted with varying predictability to proposals to spur the economy and end gridlock in Washington.

Some liberal Democrats balked at Obama’s proposal to dramatically open offshore areas to oil and gas exploration and responded warily to his offer to consider Social Security and Medicare reforms.

Republican and Democratic centrists encouraged his call for tax reform, and even said they were open to a minimum tax on multi-national corporations.

One GOP centrist said he could support new restrictions on lobbyists who bundle campaign contributions.

Republican leaders panned Obama’s proposals to eliminate filibuster of judicial and executive branch nominees and to cut federal aid on colleges that fail to control costs.

On the overarching theme of Obama’s speech, that the federal government should play a greater role in expanding the manufacturing base and push technological innovation, Democratic and Republican leaders stuck firmly to the talking points they sounded throughout the day.

“President Obama offered common-sense solutions that will create jobs and put our country on a path to economic fairness,” Senate Majority Leader Harry Reid (D-Nev.) said in a statement.

“The policies proposed by the President will narrow the inequality gap in our country while making America a leader in clean energy technology, and continue the revival of our manufacturing sector,” he said.

House Speaker John Boehner (R-Ohio) accused Obama of angling to score political points instead of reaching out to Republicans to craft pro-business legislation.

“Job creation is the driving issue for working families, but President Obama largely ignored the fact that his own failed policies are making our economy worse,” Boehner said in a statement. “Unable to run on his record, the president has regrettably turned to blame and division when what’s needed is a united effort to promote small business job creation.”

Obama’s call for tax reform, however, drew praise from a bipartisan group of centrists, a signal that it may be one of the few areas of compromise in 2012.

“We need to make sure we’re competitive on a global basis. If he’s looking at overall comprehensive tax reform, I’m all ears,” said Sen. Scott Brown (R-Mass.).

Sen. Joe Manchin (D-W.Va.), one of the president’s biggest critics in the Senate Democratic caucus, said “tax reform is what we need and I think he touched on every bit of that and I hope that we all can, really in the spirit of America, join in and have a tax reform that’s truly meaningful.”

Even Sen. Ben Nelson (D-Neb.), the strongest opponent of raising taxes in the Democratic caucus, said he was intrigued by the idea Obama floated to impose a minimum tax on corporations.

“I’ve often said after you take a look at General Electric, if people have AMT, you can make a strong case for corporate AMT,” Nelson said in reference to the Alternative Minimum Tax, which imposes a floor level of taxation on wealthier families. General Electric received a net $3 billion tax refund for 2010.

Democrats greeted other proposals with considerably less optimism, citing GOP obstruction.

Sen. Chuck Schumer (D-N.Y.), a leading voice on immigration reform, said comprehensive legislation has no chance of passing this year.

“We need to look at immigration, we’re never going to get comprehensive this year without Republican support and we don’t have it,” Schumer said. “But there are specific things that we can do on immigration that make some sense.”

He said a scaled-down immigration reform known as the DREAM Act also lacks enough support unless changes are made.

“Right now it doesn’t have all the votes but we can keep working towards it,” he added.

The legislation would allow illegal immigrants who came to the country as children a chance to gain legal residency if they met certain conditions.

Liberal Democrats were not enthusiastic about the president’s proposal to open up more of the coastline to drilling. Obama told lawmakers that he is directing his administration to open more than 75 percent of our potential offshore oil and gas resources.

“I wasn’t standing up and applauding. I want to see more about it. Obviously we have some real concerns about keeping it away from Rhode Island’s shores,” said Sen. Sheldon Whitehouse (D-R.I.).

Liberals are also wary of Obama making concessions to the GOP on Social Security and Medicare reform, something that could come up for negotiation later this year when the Bush-era tax rates near expiration.

Obama said he is “prepared to make more reforms that rein in the long term costs of Medicare and Medicaid and strengthen Social Security” as long as those programs “remain a guarantee of security for seniors.”

The president’s suggestion that Congress ban campaign bundlers from lobbying Congress could receive bipartisan support.

“Anytime we can clean up the relationship between lobbyists, outside interests and us, that’s a good thing,” said Brown, who is running for re-election against Democratic candidate Elizabeth Warren.

But Obama’s proposal to cut federal funding to colleges and universities that fail to slow rising costs drew a sharp rebuke from Sen. Lamar Alexander (R-Tenn.), who is leaving the GOP leadership this week to give himself rein to work on more bipartisan legislation.

“I think that would be a completely outrageous interference by the federal government in what ought to be the responsibility of autonomous colleges and universities and states,” said Alexander, who served as president of the University of Tennessee and later secretary of Education under former President George H.W. Bush.

Praise for tax reform, but skepticism from Congress on energy, immigration - TheHill.com