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Republicans pick sides on tax deal

The tax cut compromise making its way through Congress might be winning bipartisan approval, but neither political party is united in supporting the proposal.

While most of the intra-party angst over the measure has focused on infighting Democrats, the deal is also turning into a kind of political Rorschach test for the GOP.

Where some Republican leaders see coveted tax breaks that they believe will push the balance sheets of American businesses back into the black, others are focused on what they see as a big black hole in the nation’s debt.

The latest salvo against the deal came from 2012 GOP candidate-in-waiting Mitt Romney. In a USA Today op-ed, the former Massachusetts governor slammed the deal’s price tag and argued that the temporary nature of the tax cut extensions would aggravate uncertainty in the American economy.

“The deal delivers short-term economic stimulus, and it does so at the very time [President Barack Obama] wants it most, before the 2012 elections,” he wrote. “But the long term health of our great engine of prosperity will remain very much in doubt.”

The announcement from the presumed White House contender puts him in the camp of conservative senators like Sen. Jim DeMint of South Carolina, who was one of five Republican senators to oppose last night’s motion to move the legislation forward. DeMint – who was joined by Sens. Tom Coburn, Jeff Sessions, John Ensign, and retiring moderate George Voinovich in voting against cloture – warned last week that the plan is “going to give a lot of Republicans who just ran for office heartburn.”

Others who have raised objections to the deal include:

  • Conservative fiscal-hawk group Club for Growth, which said the deal “would resurrect the death tax, grow government, blow a hole in the deficit with unpaid-for spending, and do so without providing the permanent relief and security our economy needs to finally start hiring and growing again.”
  • The Tea Party Patriots, a national grassroots organization dedicated to “constitutionally limited government” and fiscal responsibility. Calling the proposal “problematic,” the group pointed to several tenets of the House Republican “Pledge to America” that it believes the tax cut deal would violate.
  • A group of House Republicans, including Reps. Michele Bachmann of Minnesota, Jason Chaffetz of Utah, and Darrell Issa of California. Chaffetz, who may mount a primary challenge against GOP senator Orrin Hatch in 2012, warned in an interview with Politico that the vote on the tax deal is akin to the “TARP and stimulus” measures – which happened to scuttle Hatch’s Utah colleague Bob Bennett's re-election bid at the hands of a Tea Party-aligned candidate. Issa, the House GOP’s lead government watchdog, called the Senate version of the bill “an incomplete effort that fails to create a permanent tax structure giving businesses the kind of long term predictability needed to support investment, economic growth and job creation.”
  • Former vice presidential candidate Sarah Palin, who tweeted her concerns: “Obviously Obama is so very, very wrong on the economy & spins GOP tax cut goals; so fiscal conservatives: we expect you to fight for us & America's solvency.”
  • *** UPDATE *** Republican Rep. Mike Pence of Indiana said Tuesday afternoon that he will vote against the tax cut package, citing concerns about the deficit. "At the end of the day, I've just come to the conclusion: the American people did not vote for more stimulus," he said on Sean Hannity's radio show. Pence is also discussed as a possible candidate for president in 2012.

By highlighting concerns about the deficit and opposing the deal, Romney and Palin may earn the esteem of Tea Party activists and other fiscal conservatives who echo their worries about America’s long-term fiscal health. But it also places them at odds with a number of other prominent GOP figures and presidential contenders – as well as with Republican congressional leaders and bipartisan majorities of Americans asked about the deal in recent polls.

Other potential 2012 candidates, like Newt Gingrich and Mike Huckabee, have backed the deal. Sen. John Thune of South Dakota, also viewed as likely to jump into the presidential contest, joined over 80 of his Senate colleagues to vote for cloture yesterday – although he has noted that a permanent extension would have been preferable.

“It’s the right thing to do for the country,” Thune said last week. “We need to get this tax rate issue addressed so that we don’t have this massive tax increase occur on Jan. 1.”

*** UPDATE II *** In a speech on the Senate floor Tuesday afternoon, Thune accused opponents of the deal of taking a "politically expedient" position that would result in tax hikes for all Americans.

"Inaction is not an option," he said, without mentioning Romney or other Republican opponents of the deal by name. "And advocating against this proposal is no different than advocating for higher taxes."