GOP Tax Messaging Heavy on Business Benefits

‘It all leads to the same end,’ speaker said of trickle-down effect of tax legislation

Speaker Paul D. Ryan and Rep. Andy Harris speak to employees at Dixon Valve & Coupling Company about the GOP’s still developing tax legislation. (Thomas McKinless/CQ Roll Call)
Speaker Paul D. Ryan and Rep. Andy Harris speak to employees at Dixon Valve & Coupling Company about the GOP’s still developing tax legislation. (Thomas McKinless/CQ Roll Call)
Posted October 6, 2017 at 11:10am

CHESTERTOWN, Md. – “Cutting taxes is great for the businesses to make businesses more money. But how is that going to lower my taxes, or make sure it comes down to me?” That was the question a 20-year-old Dixon Valve & Coupling employee posed to Speaker Paul D. Ryan on Thursday.

Visiting the company’s headquarters to promote the GOP’s still developing tax legislation, Ryan told the employee that he plans to lower taxes on individuals so they take home more of their paychecks. Then he quickly pivoted back to his primary message.

“This business is in global competition whether we like it or not,” Ryan said. “This business is competing against other companies, particularly, in this case, China. … Let’s at least not make their tax cost so much more than their foreign competitors so that they can keep hiring people, so that they can keep the business here.”

Keeping U.S. businesses in the country and “leveling the playing field” has been a major theme of Ryan’s as he traverses the country, touring manufacturing facilities like Dixon’s and talking to employees about how the GOP tax measure will help their employers stack up against foreign competitors.    

“Our manufacturers … are the ones that are getting hit the hardest in this global competitive economy,” the Wisconsin Republican said Thursday. “Think how competitive you are right now in spite of all you’re competing against. If we can at least give you a level playing field on taxes, think how much more competitive you’ll be.”

Ryan had a similar message for workers earlier this year at Penn Machine Works in Pennsylvania, Intel in Oregon, Boeing in Washington and New Balance in Massachusetts. As the speaker toured those factories, he touted the GOP plan to cut tax rates for corporations and small businesses and allow them to immediately write off the costs of their capital investments.

What about individuals?

What Ryan has spent much less time talking about is how the tax legislation would benefit individuals.

“There is more I obviously plan on doing, we all plan on doing,” the speaker said Thursday when asked about his messaging.

“Do you know who we think about when we think about tax reform and tax relief?” Ryan said. “We think about the moms and dads who go to bed worrying about the next day, whether they can make ends meet. We think about the people in this country who are living paycheck to paycheck. So the purpose of tax relief is [to] give middle-income taxpayers a tax cut, give them a tax break.”

Ryan to Factory Worker: ‘We’re Going to Lower Your Taxes Yourself’

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The way the GOP plans to do that is by cutting individual rates, doubling the standard deduction, removing the marriage penalty and increasing the child tax credit, he said.

That message, however, often gets lost amid talk of the business benefits.

Dixon employee Dan Bull said he thought Ryan’s tax pitch was focused more on businesses and less on individuals.   

“There was sprinkles of, you know, this is going to affect you personally in a positive manner,” he said, noting he hopes the proposal will have the effect Ryan and Maryland GOP Rep. Andy Harris described.

“They’re very good at speaking,” Bull said.

Harris, who joined Ryan at Dixon, said the tax plan provides a direct benefit to individuals in that their paychecks will increase. It also affects them indirectly by helping businesses hire more people and create job security for their existing employees, he said.

“This is exactly why the speaker is doing this, because we know those questions are out there,” Harris said. “People distrust Washington. They think that Washington is just for special interests. This tax plan exists, just like the speaker said, so that the average person, the person who goes to sleep at night worrying about how they’re going to live from one paycheck to the other — gets a leg up.”

‘Until we make it personal …’

While Republicans themselves see the benefits clearly, they acknowledge the need to do a better job communicating those to constituents. 

“People couldn’t care less about tax reform,” House Freedom Caucus Chairman Mark Meadows said. “They care about their own taxes. And until we make it personal … all the messaging in the world won’t help, until it’s how it affects those people that each and every day go to work, come home, try to feed a family.”

That’s the downside of the limited details available about the GOP plan, the North Carolina Republican said, explaining there’s not yet enough information to show how the legislation would affect every middle-income taxpayer. Without those specifics, events like Ryan’s factory tours are “white noise,” Meadows said.

Meadows was among several GOP members who spoke about messaging before Ryan’s visit to Dixon.

Ryan and President Donald Trump need to “go up to the mic” — using high-profile speeches and TV appearances — to speak directly to middle-class workers about the individual benefits of the supply-side economics that guide the GOP plan, Freedom Caucus member Dave Brat said.

“We need to do way more, much better,” the Virginia Republican said of the party’s messaging on taxes. “The average American doesn’t know the basic point right now, and the basic point is that there is no way to raise wage rates without raising productivity.”

Florida Rep. Carlos Curbelo, a moderate Republican and member of the tax-writing Ways and Means Committee, agreed that the GOP needs to explain why the legislation should be important to people, but said he believes the party is already doing that well.

“I think by now most Americans understand that this is the most important thing we can do to improve quality of life in this country,” Curbelo said. “There’s a lot of frustration, anger, anxiety, scapegoating in our country, and I think part of that is attributable to an economic recovery that didn’t reach every home in America. This is the opportunity to deepen that recovery so that it touches everyone in this country.”

Improving ‘slowly’

The party’s messaging has definitely improved, Republican Study Committee Chairman Mark Walker said. Still, the GOP’s most prominent failing grade over the past 20 years is on messaging about individual opportunity, the North Carolina congressman said.

“We may have the greatest policy in the world, but if it never reaches the ear of the audience then what good is it? So I think we’re starting to realize that slowly,” he said. He gave the GOP “a solid B” grade.

Where Republicans could improve is in illustrating the value of exemptions and deductions, Walker said.

“Tell the American people what this means: maybe being able to purchase another car, being able to go out to the movies or out to eat a couple times,” he said. “That’s where it needs to resonate.”

Ryan said those personal appeals are something he’d like to do more, but the focus of the factory tours is making companies more competitive so they can expand. Raising wages is a part of that message too.

“It all leads to the same end, which is help people become more prosperous, help people get better jobs with bigger paychecks, help the American economy be stronger and healthier,” he said. “These things are all related, and we’re going to talk about all of it.”