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GOP's midterm mission of selling tax cuts begins now

The U.S. Chamber of Commerce joins a growing GOP offensive to sell their tax cuts between now and the November midterm elections.
Image: Trump and the first lady travel to Ohio for events on opioid addiction and tax policy
U.S. President Donald Trump delivers remarks on his tax policy after a factory tour of the Sheffer Corporation in Blue Ash, Ohio on Feb. 5, 2018.Jonathan Ernst / Reuters file

WASHINGTON — The U.S. Chamber of Commerce is readying a multimillion dollar ad campaign aimed at bolstering vulnerable GOP lawmakers who voted for President Donald Trump’s tax cut while also urging thousands of member companies to alert workers as to why their paychecks may have increased this month.

Outside political groups are already running ads against Democratic senators who opposed the tax bill and small armies of college students will soon be knocking on doors in northern Virginia, South Florida and the Philadelphia suburbs touting the newly enacted law.

It’s all part of a growing GOP offensive ahead of this fall's midterm elections based on the assumption that control of Congress depends on how Americans respond to the nation’s new tax system.

“If this is just a referendum on Trump, we’re going to lose,” said Scott Reed, the Chamber’s senior political strategist. “We know we have to change the terms of the debate, and this tax cut and tax reform is working.”

The Chamber’s television and digital campaign starts next month, an unusually early entry for the predominantly GOP-leaning group into a midterm election fray. It complements efforts by Vice President Mike Pence, who’s just begun a cross-country fundraising and town hall sprint, as well as an array of deep-pocketed outside groups with a focus on touting the tax cuts in critical House and Senate races.

Democratic worries

Despite Trump’s historic unpopularity in polls, the economy and how voters feel about their own pocketbooks can have a big impact on elections and Democrats fear the GOP will succeed in assigning credit to the tax cuts for any positive economic news.

House Speaker Paul Ryan told GOP lawmakers at a party retreat last week that his top goal was coaching them on how to promote the tax plan in their districts.

And a recent Quinnipiac poll suggests a sustained focus on the tax cuts may already be helping rebrand the once mostly unpopular tax package, showing an uptick from 32 percent approval in January to 39 percent now.

“It’s incumbent on the Democrats to really fight back on this,” said Peter Fenn, a Democratic pollster who’s advised numerous campaigns, including Barack Obama’s.

Some Democrats disagree, arguing the millions in promotional dollars being spent by Republicans have limited potential since voters can see how minimal an impact the tax cut will really have on their paychecks. They cite a recent tweet from Ryan highlighting a secretary who was “pleasantly surprised her pay went up $1.50 a week," which was later deleted.

And some are gearing up to fight back. Guy Cecil, who heads the Democratic super PAC Priorities USA, said his group is launching digital ads targeting the tax cuts. “We don’t need to match them dollar for dollar, but we have to be aggressively making the case,” he said, adding that Democrats need to remain vigilant in talking about how the tax cuts primarily benefit the wealthy.

For instance, a new Priorities ad seeking to bolster Sen. Claire McCaskill, one of the Senate’s most vulnerable Democrats, says Trump will cut Medicare to pay for tax cuts for billionaire GOP donors Charles and David Koch.

According to the Tax Policy Center, by 2027 83 percent of the tax law’s benefit will go to the top 1 percent of taxpayers.

“There’s a difference between businesses spending billions to promote it and opponents getting on a bus to fight against it. Republican donors literally made billions of dollars from these tax breaks so it’s no surprise they’re going to spend millions to try to promote it,” said Jesse Ferguson, a longtime Democratic strategist and spokesman for Not One Penny, a grass-roots group that opposed the tax law.

The group plans to double digital and TV ad budget to $10 million and since January has been hosting events in battleground states including Missouri and Nevada.

According to the nonpartisan Tax Policy Center, it’s too early to gauge the financial effect of the tax cuts. While a lower corporate tax rate and an immediate provision to expense new equipment could spur business investment, the increased deficit caused by the tax law could cancel that out by increasing inflation and interest rates.

“What do we know right now? The answer is not very much,” said Eric Toder, Tax Policy Center co-director. While a number of companies issued bonuses in late 2017, a new Morgan Stanley survey found just 13 percent of companies’ tax cut savings will go to pay raises, bonuses and employee benefits.

A focus on local efforts

A memo Ryan shared with his conference during last week’s retreat found the tax plan’s approval ratings remain unpopular in 52 of 69 key congressional districts, with a plurality of voters in 50 districts believing it will actually increase their taxes.

“There is no positive outcome in November if we do not show that we cut taxes for the middle class and are working to make their lives better. Period,” reads the memo Ryan shared with members.

The army of outside groups springing into action includes the Congressional Leadership Fund (CLF), aligned with Ryan, and America First Policies, aligned with Pence. The Senate Leadership Fund is targeting new ads at vulnerable Democratic senators who voted no on the plan, including West Virginia’s Joe Manchin.

CLF says so far they’ve knocked on more than 1 million doors since the tax law passed. The fund has 27 field offices deploying college students to knock on doors. “We need to double down,” said Corry Bliss, CLF's executive director. “It’s naive and stupid to say tax reform will sell itself. It’s the responsibility of every member of the Republican Party to sell tax reform.”

Americans for Prosperity (AFP), a Koch brothers-backed political group, began a $4 million ad campaign this week targeting vulnerable Democratic senators Claire McCaskill of Missouri and Joe Donnelly of Indiana, who opposed the bill.

It’s part of a $20 million campaign that will also include at least 100 town hall meetings before Memorial Day to “thank” GOP House members who backed the law and target Democrats who didn’t. The first one was this week in Phoenix.

“The Democrats were far too extreme in attacking the benefits of this law and it’s hurting them,” said Tim Phillips, AFP president. “We’re going to make sure the people in their states know about it.”

The U.S. Chamber is creating a database in the form of a clickable map that tracks bonuses, raises and job creation. Chamber officials say it can be used by other outside spending groups to create television ads and promotional materials highlighting local companies and workers.

According to the Chamber, the campaign will initially release ads in support of 10 of the most vulnerable House Republicans — including Carlos Curbelo in Florida, Barbara Comstock in Virginia and Will Hurd in Texas — and broaden in the coming weeks. “There’s a big difference between the U.S. Chamber going out with a local chamber, which is the gold standard in these communities, and some phony Washington establishment group” sponsoring ads, Reed, the Chamber strategist, said.

The ads will feature local companies and local workers. They will also point to House Democratic Leader Nancy Pelosi, a popular foil for Republicans, who has called the benefits of the tax law for the middle class “crumbs.”

Republicans say they’re already moving the public opinion needle overall.

For the first time, more voters say Trump is responsible for the current state of the economy than Obama, 48-41 percent, a nine-point margin, according to Quinnipiac. In January voters, by nine points, said that Obama was more responsible for the state of the economy.