Senate vote to repeal ethanol tax credit fails, but some in GOP break ranks

A majority of Senate Republicans appeared to break Tuesday with two decades of GOP orthodoxy against higher taxes, voting to advance a plan to abruptly cancel billions of dollars in annual tax credits for ethanol blenders.

The measure, offered by Sen. Tom Coburn (R-Okla.), fell short of the 60 votes needed to overcome a filibuster threat. But it had the support of 34 of 47 Republicans, most of whom have signed an anti-tax pledge that specifically prohibits raising taxes by any means but economic growth.

Coburn has argued forcefully that Republicans must abandon that pledge if they are serious about tackling the spiraling national debt. Though the Senate turned back his measure, he said the vote nonetheless marks the beginning of the end of GOP tolerance for wasteful giveaways through the tax code.

“You’ve got 34 Republicans that say they’re willing to end this, regardless of what Grover says,” Coburn said, referring to pledge creator Grover G. Norquist, the founder of Americans for Tax Reform. “That’s 34 Republicans that say this is more important than a signed pledge to ATR.”

The vote was hardly a slam dunk for Coburn’s crusade against the dozens of tax credits and deductions that he derides as government spending by another name. Several senators who voted against the ethanol credit, which is widely condemned by Republicans as bad economic policy, said they would not necessarily vote to end other types of tax breaks. And Norquist, who has been feuding for months with Coburn, pressed an elaborate campaign to blunt the vote’s ideological impact.

Still, many GOP senators were emphatic in their support for the Coburn measure, suggesting that a crack may be opening in the Republican front against new revenue — a development that could help ease a path to a debt-reduction compromise with Democrats, who are insisting on additional revenue as part of any deal.

“Everybody’s entitled to their own opinion,” said Sen. John McCain (R-Ariz.), when asked whether wiping out the ethanol credit is tantamount to raising taxes. “It’s my opinion that it’s a disgraceful subsidy that is unwarranted and a waste of taxpayer dollars.”

Rep. Chris Van Hollen (D-Md.), a participant in bipartisan talks led by Vice President Biden aimed at forging a debt-reduction agreement, said Coburn’s “willingness to cut special-interest tax breaks for the purpose of deficit reduction is encouraging.”

“A realistic conversation about deficit reduction must include both cuts and revenues, and Senator Coburn’s amendment to eliminate $6 billion in tax earmarks for ethanol is an important part of this discussion,” Van Hollen said.

The Biden talks resumed with fresh urgency Tuesday. Biden said the group of top administration officials and six lawmakers has set a goal of presenting a plan to President Obama, House Speaker John A. Boehner (R-Ohio) and Senate Majority Leader Harry M. Reid (D-Nev.) by July 1.

“We are making real progress,” Biden told reporters afterward. “It ain’t over till it’s over, but I’m convinced that we can come up with an agreement that gets the debt limit passed and makes some real serious down payment on a commitment to [save] 4 trillion bucks over the next 10 or 12 years.”

Senate vote to repeal ethanol tax credit fails, but some in GOP break ranks – The Washington Post

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