Taxwriters seek insight from players in last code overhaul

The last group of lawmakers to overhaul the tax code told current members eyeing reform that success only comes from an intensive effort by all major players, as well as a healthy dash of luck.

The Senate Finance Committee welcomed back a pair of key players from the last time Congress was able to overhaul the tax code in 1986: former Senate Finance Chairman Bob Packwood (R-Ore.), and Sen. Bill Bradley (D-N.J.).

{mosads}Both offered an unflinching take on the heavy lift of redoing the tax code, a project both parties agree is needed but have made minimal progress in actually doing.

“The only way it can be done is bipartisan, quickly, and behind closed doors,” said Packwood.

With top taxwriters in both chambers vowing to take another run at tax reform over the next few years, Bradley also noted that the executive branch needs to play a key role in any successful effort. He said the Treasury Secretary needs to be involved in the matter “constantly,” and the president needs to be able lay himself on the line to get it done.

“You need a president who is going to put his prestige and clout on the line to drive things through when the inevitable obstacles appear,” he said.

And in the way that only former lawmakers can speak, Bradley also said that major players need to see some political advantage towards pursuing reform.

He noted that in 1986, Ways and Means Chairman Dan Rostenkowski (D-Ill.) saw the chance to become “a historic chairman” with reform, while Packwood saw he could be the first Finance chairman to get reform done.

But even if all the biggest names in Washington are fully committed to a tax reform effort, there are no guarantees.

“You have those parts in place, and then you have a chance,” said Bradley.

While President Reagan at least had a divided Congress to work with, President Obama would need to bridge the gap with an all-GOP Congress. And with the two parties still feuding over whether tax reform should raise revenue or remain neutral on that front, there are fundamental questions to be addressed before a broader effort could take form.

“If they don’t agree on the goal, no quantity of leadership is going to make any difference,” said Packwood.

Another challenge facing the current crop of reform-minded lawmakers is their more modest goals. Much of the focus on tax reform currently is on revisiting the business side of the code, where there are some areas of agreement, while leaving the individual side to be dealt with later.

But Packwood said it was essential to tackle the entire code all at once, as a way to protect lawmakers from single-interest groups angry about losing preferred perks.

“You’re better off trying to do both at once,” he said. “Do it in one bill so people don’t have to pick out a particular thing they don’t like and be forced to vote on it.”

Despite those challenges, both Bradley and Packwood said that long odds of tax reform does not necessarily rule out making the effort. Rather, if the right group comes together to make a serious push, anything could happen, they said.

“Nobody can make the right circumstances….all you can do is be around when the circumstance comes and take advantage of it,” said Packwood.

And Bradley offered a novel take for modern lawmakers.

“Legislating is fun…with the right people,” he said. “You can do something very important.”

Tuesday’s hearing also marked a unique return for Packwood, who ultimately resigned from Congress after a series of sexual harassment allegations. In discussing tax reform, Packwood even cited some sections of his extensive diary, which played a central role in investigating those allegations.

No mention was made Tuesday of Packwood’s inauspicious exit from Washington, and the two women on the committee – Sens. Debbie Stabenow (D-Mich.) and Maria Cantwell (D-Wash.) did not ask him any questions.

Towards the end of the hearing, Wyden asked Packwood if he had any regrets — but limited it to just the process towards getting the 1986 law enacted.