By Alan Murray and Tom Huddleston Jr.
August 24, 2017

Good morning.

Speculation about whether Gary Cohn will resign from his job as the President’s top economic adviser has become a popular parlor game in Washington and on Wall Street. The Trump adviser is said to be deeply offended by the President’s equivocation over the protests in Charlottesville.

But what’s become clear in the last few days is that Cohn, Treasury Secretary Mnuchin, Speaker Ryan, Majority Leader McConnell, Finance Chair Hatch, and Ways and Means Chair Brady are quietly putting together the outlines of a tax plan that they still think has a chance—even if it’s a fading chance—of passage. And it’s a good bet Cohn won’t leave until the last hopes for that plan have been extinguished.

Ryan visited an Intel plant in Oregon yesterday in order to push for the tax plan, which he said would make it possible for the company to keep more manufacturing in the U.S. Brady did the same at home in Texas, saying a broken tax code is to blame for the lack of well-paying jobs for U.S. college students there.

A report in Politico earlier this week said the six are fashioning a plan that would lower the corporate tax rate to the mid-20s, further limit the mortgage interest deduction for homeowners, scrap the deduction for state and local taxes, eliminate businesses’ ability to deduct interest expenses, and allow expensing for small business investment. Many of the cuts likely will be temporary, in order to allow the plan to meet the test of 10-year deficit neutrality, and enabling it to pass the Senate with only 51 votes. That’s not as bold a plan as many had hoped, but would still be a significant accomplishment.

But can the gang of six succeed, given a President who seems determined to undercut their effort by threatening to shut down the government, attacking Senators of his own party whose votes he needs, and waging relentless war on the press? That’s the great mystery of the moment. If they do succeed, they’ll deserve the nation’s gratitude.

 

More news below.

Alan Murray
@alansmurray
alan.murray@fortune.com

SPONSORED FINANCIAL CONTENT

You May Like