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Trump aides try to quash tax hike rumors amid infrastructure talks


Mick Mulvaney

White House Chief of Staff Mick Mulvaney has been trying to quiet fears of a tax hike to support a White House infrastructure proposal. | Mark Wilson/Getty Images

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Senior advisers have repeatedly downplayed the possibility in private meetings with fiscal conservatives who are expressing alarm.

The White House is reassuring conservative leaders that it has no plans to hike the gas tax to help fund a massive infrastructure package that President Donald Trump hopes to negotiate with Congress.

Both acting White House chief of staff Mick Mulvaney and Russ Vought, Trump’s budget director, have repeatedly downplayed the possibility in private meetings with fiscal conservatives who are expressing alarm that Trump might embrace a massive tax increase. Concerns have specifically centered around a potential gas tax boost, an idea that Trump has flirted with during his presidency.

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“It is my understanding that they are not going to be agreeing to any tax increases,” said Americans for Tax Reform President Grover Norquist in an interview. Norquist said he has discussed the matter with White House officials in recent days, but did not disclose specifics. He was spotted at the White House on Friday, where he attended a meeting with Vought in which conservative leaders discussed upcoming spending battles, according to two attendees.

In a rare moment of bipartisan comity, Trump agreed last month in a meeting with Democratic leaders to devise an infrastructure plan of up to $2 trillion to build things like roads, bridges and high-speed rail. But the feel-good gathering punted the vexing question of where the massive sum of money would come from, prompting competing ideas and speculation from across the political spectrum.

One long-simmering rumor that took off after the meeting was that Trump might endorse an increase in the gas tax to help fund the infrastructure package. It’s a prospect that deeply unsettles conservatives and some administration officials, who oppose any tax increase to pay for the projects. BloombergreportedFriday that a draft internal document mentioned a gas tax increase as an option for financing the plan, intensifying the jitters in conservative circles.

The notion that Trump might break with conservative anti-tax orthodoxy has also gotten traction because of reports that heexpressed supportfor a 25 cent-per-gallon tax during a meeting with lawmakers in early 2018.

Although officials called the fears overblown, they also concede that — as with any policy issue — Trump could always change his mind.

The private discussions come as Trump is planning to meet next week with House Speaker Nancy Pelosi, Senate Minority Leader Chuck Schumer and other Democrats to discuss options to pay for the plan. The meeting is currently scheduled for Wednesday, according to two administration officials. Pelosi and Schumer previously met with Trump at the White House in late April.

“On Wednesday, the president will welcome congressional Democrats to the White House to continue the discussion on rebuilding our nation’s crumbling infrastructure,” White House spokesman Judd Deere said in a statement. He otherwise declined to comment.

While the two sides originally settled on a $2 trillion price tag, the president subsequently seemed to backtrack ina tweetin which he put the cost at between $1 trillion and $2 trillion.

Senior White House aides and members of Congress are deeply skeptical that a massive infrastructure bill can get approved. While both Democrats and Republicans agree in theory on fixing the country’s aging roads and bridges, they have been fighting for years about how to pay for such a plan.

The political reality could result in a standoff between Trump and Democratic leaders, with both sides publicly going through the motions of negotiating an infrastructure deal in hopes of pointing the finger at the other side if it falls apart. Both Democrats and Republicans are keen to at least appear productive, reasonable and bipartisan heading into the 2020 presidential election.

“It’s all about positioning themselves it in a way that you can blame the other side for nothing happening,” said a person close to the White House who has been involved in the infrastructure discussions.

Part of the reason White House officials remain wary of delving into specifics about the best way to pay for infrastructure improvements is because they have yet to develop a concrete plan internally. They also fear Democrats will use anything discussed in the meeting to score political points.

Trump acknowledged as much in an interview with Fox News set to air on Sunday, insisting he is interested in an infrastructure deal, but that “I also think we’re being played by the Democrats a little bit.”

“I think what they want me to do is say, ‘Well what we’ll do is raise taxes, and we’ll do this and this and this,’ and then they’ll have a news conference — ‘see, Trump wants to raise taxes,’” he said ina clipreleased Friday. “So it’s a little bit of a game.”

The president also appeared to criticize Mulvaney for publicly downplaying the prospects of passing an infrastructure bill.

“If Mick Mulvaney said that, then he has no right to say that,” Trump said. “He tells me he didn’t say that and he didn’t mean it. He said it’s going to be hard to finance.”

A senior administration aide said the president and Mulvaney remain 100 percent on the same page on infrastructure.

Inside the White House, officials have been making the case that a hypothetical gas tax would not raise anywhere close to the $2 trillion needed. And, they’ve argued, it would ultimately undercut the gains consumers received from the Republicans’ 2017 tax bill.

Conservative groups say they will be closely watching Wednesday’s meeting between Trump and congressional leaders. “I don’t think anyone has gone so far to rule it out ahead of time, because no one wants to get ahead of the president,” said one conservative following the talks.

The administration is weighing other options to raise anywhere from $1 to $2 trillion to fund an infrastructure package. It’s unclear how much of that money would come from the federal government versus the private sector.

Policy ideas that have been floated include selling off government assets to raise additional funds, or re-introducing spending offsets from the president’s past budget proposal as part of the negotiation. Staffers from the White House’s National Economic Council, Vought’s Office of Management and Budget and the Treasury Department have all been part of the discussion.

Outside conservative groups have latched onto a bipartisanbillfrom Reps. Mike Kelly (R-Penn.), William Lacy Clay, Jr. (D-Mo.) and Ted Budd (R-N.C.) that could pay for at least part of the infrastructure package without raising taxes. The proposal would direct the Agriculture Department to sell its distressed assets and then direct the proceeds toward infrastructure projects. Anti-tax advocates have pitched the bill directly to White House officials in recent days, according to a person familiar with the matter.

Trump has always been interested in an infrastructure package, viewing it as an extension of his career as a real estate developer and a concrete way of building a legacy as president.

Even as far back as May 2015 — a month before launching his campaign — Trump tweeted: “The only one to fix the infrastructure of our country is me – roads, airports, bridges. I know how to build, pols only know how to talk!”

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