Rangel Vows Bipartisanship, Action on Trade as House Panel Head

By Ryan J. Donmoyer

Sept. 20 (Bloomberg) -- Democratic Representative Charles Rangel vowed to reach out to Republicans if his party wins control of the House in November, while acknowledging that they may find his plans for changing tax policy unpalatable.

Rangel, in line to become the first Democratic chairman of the tax-writing Ways and Means Committee since 1994, said he would seek to work with Republicans whenever possible. One area of compromise, he said, may be stalled trade agreements and renewal of rules that make it easier for a president to negotiate such accords.

Rangel's accession to the chairmanship of the committee would likely end six years of tax cuts by the Republican- controlled Congress. He said he ``cannot think of one'' of President George W. Bush's first-term tax cuts that merit renewal. He also said no discussion would be possible on overhauling Social Security until Bush dropped a plan to create individual accounts funded by payroll taxes.

``If they want to get that on the agenda, they better take privatization off the table,'' Rangel, 76, an 18-term New York lawmaker, said in an interview. ``Trade will be easy to work out some agreement, and we can probably do some minor things with the tax code.''

Recent polls show that Democrats this year have their best chance of recapturing control of the House since the Republican takeover in 1995. Rangel would replace Republican Representative Bill Thomas of California as head of the panel if the Democrats get the net gain of 15 House seats they need to win a majority.

On taxes, Rangel said he would only draft legislation that wouldn't increase the national debt. He would reverse 12 years of Republican policy and return to the ``pay-as-you-go'' budget restrictions of the 1990s that require new expenditures to be offset by revenues.

No `Increase in Deficit'

``If we want to spend some money it's my intention to be able to go to the floor and say it will not cause an increase in the deficit,'' he said.

Former Minnesota Congressman Bill Frenzel, a Republican who entered office with Rangel in 1971, called him ``a smart guy'' who ``knows taxes and the other jurisdictions of the committee very thoroughly.''

Frenzel, now a fellow at Washington's Brookings Institution, said Rangel would have to tread lightly in running his committee to hold together a Democratic House majority that would be likely to contain new members from districts that had previously elected Republicans and might switch back.

``If Democrats take over, they'll have as tender a majority as they've ever had,'' Frenzel said.

Bipartisan Cooperation

Indeed, Rangel said his first job as chairman would be to restore bipartisan cooperation to the committee. Thomas, he said, never consulted with Democrats on the panel and many in Rangel's party may be tempted to seek revenge for years of perceived mistreatment.

``They can't afford the luxury of getting even,'' Rangel said. ``I realize politically I can't get a damn thing done unless Republicans feel politically like partners.''

As a priority, he said Republicans and Democrats need to work together to address the expanding reach of the alternative minimum tax, a parallel system designed to prevent the richest from avoiding taxes that increasingly ensnares middle-income households. Repealing the AMT would cost the government in revenue more than $1 trillion over a decade, according to a 2005 report by a presidential panel.

``We'll have to pay for it, and it's a big monster to do,'' he said. ``But it's equity. It's the fair thing to do. It's a lousy policy to make a mistake and to keep the policy because it's expensive.''

Trade Agreements

He said there was also room for compromise on trade agreements, which the administration has fought hard to pass over the past two years. Rules allowing the president to present trade deals to Congress for approval or rejection without amendment passed by only one vote five years ago, and only 15 Democrats voted for the Central American Free Trade Agreement last year. That deal passed the House of Representatives by two votes. This year, only 22 Democrats voted for the Oman Free Trade Agreement, which passed by only 16 votes.

Before each of those votes, administration officials, foreign diplomats and Rangel's staff tried unsuccessfully to work out compromises on labor-rights provisions that would give Democrats reason to support the pacts.

``The administration has already been dealing with Rangel's concerns on trade negotiating authority,'' said Mark Nguyen, a senior policy adviser at the law firm Bryan Cave LLP in Los Angeles. ``I'm sure someone like him would work to facilitate the discussions with Republicans, but more on his terms.''

Some administration goals, however, may be a dead letter. Republicans, Rangel said, could ``forget about'' repealing the tax on multimillion-dollar estates, which he said would only benefit the richest ``1 percent'' of U.S. households.

Rangel also said he wouldn't be able to accomplish broad changes to the tax code while Bush remains in office because repairing relations between the two political parties will take longer than the two years the president has left to serve.

``Quite frankly, I would love to deal with simplification of the tax code, and I'm at an age where you are allowed to take a lot of risks,'' he said. ``But I'm not stupid enough to believe that there's going to be that much bipartisanship.''

To contact the reporter on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net .

Last Updated: September 20, 2006 00:05 EDT

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