Breaking News

Qualcomm Gets SEC Wells Notice on China Bribery Allegations
Tweet TWEET

No-Tax ‘Zealot’ Norquist Emerges as Biggest Barrier to U.S. Deficit Deal

When members of the House Budget Committee gathered over sandwiches to meet with the leaders of President Barack Obama’s debt commission in Washington, former Senator Alan Simpson delivered a warning.

“If you are in thrall to Grover Norquist,” the Wyoming Republican who co-led the debt panel said he told the group in February, “this country hasn’t got a prayer.”

There may be enough congressional Republicans enthralled with Norquist, a small-government advocate who has spent the last quarter-century pressing lawmakers to sign a pledge never to raise taxes, to kill any comprehensive, bipartisan deal to rein in the $14.3 trillion national debt, say current and former members of Congress.

“Until Republicans are more afraid of the deficit than they are of Grover Norquist, we’re going to have a problem,” said Representative Christopher Van Hollen of Maryland, the top Democrat on the Budget Committee.

Norquist, 54, president of Americans for Tax Reform, says he has secured written pledges from 40 of the 47 Republicans in the Senate and 233 of 240 party members in the House. More than 1,300 state-level legislators, governors and even auditors have also signed, Norquist said. That includes Wisconsin Governor Scott Walker, Texas Governor Rick Perry and Ohio Governor John Kasich, all Republicans, he said.

Those who sign gain from Norquist’s support. Those who break the promise risk his wrath.

Under Attack

The pledge is coming under fire as two groups of lawmakers try to negotiate a package of spending reductions and revenue increases to curb the budget deficit. Republicans are demanding spending cuts as a condition of raising the statutory debt ceiling the Treasury reached last week. If lawmakers don’t boost the cap by Aug. 2, the U.S. risks a default, Treasury Secretary Timothy Geithner said.

Norquist, whose hard line on taxes belies an inclusive view of the Republican Party that welcomes Muslims, gay people and those who favor abortion rights, is undeterred by such warnings.

Every Republican involved in the negotiations has signed his pledge, which includes two promises: to “oppose any and all efforts to increase the marginal income tax rates for individuals and/or business” and to “oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.”

Showing His Clout

In an illustration of Norquist’s clout, he met on May 19 with Idaho Senator Mike Crapo, a Republican member of the so- called Gang of Six budget negotiators who some Democrats say may drop out of the talks. Norquist spokesman John Kartch and Crapo spokesman Amanda Critchfield both declined to say what was discussed.

Photographer: Greg Newington/ATR via Bloomberg

Norquist created Americans for Tax Reform in 1985 from the network of activists working to help President Ronald Reagan pass a tax-overhaul law. Close

Norquist created Americans for Tax Reform in 1985 from the network of activists working... Read More

Close
Open
Photographer: Greg Newington/ATR via Bloomberg

Norquist created Americans for Tax Reform in 1985 from the network of activists working to help President Ronald Reagan pass a tax-overhaul law.

Norquist denied that the commitment from lawmakers is making it harder for them to negotiate.

The pledge makes it difficult or impossible to raise taxes,” he said. “It doesn’t make it difficult to cut spending. That’s kind of the point, isn’t it?”

Some Republicans, including Illinois Senator Mark Kirk, Georgia Senator Saxby Chambliss and U.S. Representative Frank Wolf of Virginia, say any solution to the debt issue will have to involve a revenue increase, probably the elimination of tax breaks for certain industries or activities. Under Norquist’s definition, that would be a violation, and he’s ready to make them regret it.

“Taxes are when the government takes away what you create with your own work effort and time,” he said in an interview. “That reduces your liberty.”

13.2% a Year

A Bloomberg Government study in March showed that, without tax increases, lawmakers would have to cut spending by $4.9 trillion, or an average 13.2 percent a year, by 2020 to meet the debt panel’s goal of reducing government debt to 60 percent of gross domestic product. The reductions would include $225 billion from discretionary spending in the peak cutting years of 2016 and 2017. That’s about the equivalent of zeroing out the departments of Education, Energy, Housing and Urban Development, Homeland Security and Justice two years in a row.

If spending were lowered and taxes raised in equal measure, the cuts would average 6.6 percent a year, the report said.

Norquist has attacked Senator Tom Coburn, a onetime member of the Gang of Six, because the Oklahoma Republican raised the possibility of eliminating tax breaks. Norquist said if Coburn agreed to a tax increase “he was elected on a lie.”

That Norquist is taking on Coburn -- who last year blocked 120 spending measures in the Senate -- has some Republicans shaking their heads.

‘Fly on the Wall’

“Tom Coburn is an excellent conservative,” said Simpson, 79. Norquist, he said “is a zealot and a perfectionist, a 100 percenter.”

Coburn dismissed Norquist last week as “a fly on the wall. All noise and no substance.” Still, he has said he doesn’t plan to run for re-election in 2016. House members who will have to vote on any deal will face voters in 2012, and they’ve seen what Norquist can do.

“I spent $7.5 million in the 2010 election season talking about who has and hasn’t taken the pledge,” Norquist said.

When Abel Maldonado, a pledge-signing state senator in California, voted for a tax increase proposed by former Governor Arnold Schwarzenegger to help close the state’s budget gap, Norquist took revenge.

‘Closed for Business’

He issued a press release saying that because of Maldonado “California is closed for business.” He followed that up with a video distributed on YouTube, wrote opinion pieces in California newspapers and blogs, and just before the primary election in 2010 when Maldonado was running for lieutenant governor, Norquist distributed a list of state legislators who had broken the pledge, including Maldonado, to local papers.

Maldonado, who had been appointed by Schwarzenegger in 2009 as interim lieutenant governor, lost his bid for a full term. Maldonado didn’t respond to calls and an e-mail seeking comment.

In Virginia, Norquist distributed 90,000 posters with the pictures of pledge-breakers, and ran similar campaigns in North Carolina and Oregon.

Norquist has built up a following over the last 25 years that he says includes about 250,000 people who receive his group’s mailings and e-mail communications. And he hosts a weekly meeting that serves as a hub for conservatives to share information.

Activists ‘Speed-Dating’

On a recent Wednesday morning, he stood by the coffee urn in the gathering room at his 12th Street offices surrounded by young men and women from a range of organizations who were eager to catch his ear. Lobbyists, strategists and representatives from corporations milled about munching bagels.

Norquist has presided over this “center-right” meeting since 1993, when he set out to help defeat then-first lady Hillary Clinton’s health-care-overhaul plan.

About 30 people a week get 3 minutes to speak, updating the group on the progress of their cause. On this Wednesday, presenters included a Senate hopeful, lobbyists, Hill aides and some activist groups. The meetings are off the record, though reporters are occasionally invited to observe.

“It’s speed-dating for political activists,” said Douglas Holtz-Eakin, the president of American Action Forum, a Washington group that pushes for limited government, and a former economic adviser to John McCain’s presidential campaign.

Norquist has some rules. There’s no debate and no “emoting,” he said. “You say what you’re doing, not what you’re feeling.” These rules have allowed the meeting to thrive because people who disagree on some issues can come together on others, he said.

Helping Reagan

Norquist, raised in a wealthy Boston suburb and holder of a bachelor’s degree in economics and an MBA from Harvard University, created Americans for Tax Reform in 1985 from the network of activists working to help President Ronald Reagan pass a tax-overhaul law. The following year he wrote the Taxpayer Protection Pledge.

He believes in coming together: He sits on the board of the National Rifle Association and is an adviser to GOProud, an organization of gay conservatives. He’s married to a Kuwaiti- born Muslim woman.

Norquist, who peppers his conversation with comic voices, Chekhov quotes and references to the movie “Grease,” is big on numbers. He knows what year his meeting reached an average of 80 people and when it grew to 100. He keeps charts on how much coffee and how many bagels are consumed, and his staff counts the attendees every 15 minutes so he can graph the flow.

Abramoff Ties

He’s replicated the meeting in 45 states, building himself a loose national network.

Said Holtz-Eakin: “He finds promising politicians at the state level and has them sign the pledge, so when they arrive in Washington, they’re already committed.”

Norquist -- who opposed the 1992 re-election bid of Republican President George H.W. Bush for breaking his own “Read my lips, No new taxes” vow -- probably reached the pinnacle of his influence when George W. Bush was president. White House visitor logs released in 2006 showed he had visited 74 times over five years.

That was also the period when his less-savory associations, including ties to lobbyist Jack Abramoff, who pleaded guilty in connection with a corruption scandal in 2006, came to light.

Norquist was accused by the Senate Committee on Indian Affairs, which was led by McCain, of serving as a conduit for Abramoff to move money from the Choctaw Indians to other groups, in an effort to disguise the source of the funds.

Politically Inspired

Norquist said the accusations were drummed up by political opponents. He said he was never accused of breaking a law and that the Internal Revenue Service never investigated his group.

“Jack was an old friend who unfortunately got involved in some bad things,” Norquist said. “Fortunately, he did me the favor of never inviting me into any of that.”

With Obama in the White House, Norquist remains a player on Capitol Hill. He, along with representatives of the U.S. Chamber of Commerce and other business groups, meets a few times a month with the Senate’s Republican Policy Committee. Senator John Thune of South Dakota, who heads the committee, goes to the groups’ offices or sends his staff there to learn about issues and get their input, Thune said in an interview.

Robert Bennett, a former Utah senator who lost his bid for renomination for a fourth term last year at the state Republican convention, said he would sometimes run policy positions by Norquist before going public. An adviser to another Republican senator, who asked not to be named, said that practice wasn’t uncommon.

‘Pain in the Back’

Senator Orrin Hatch, another Utah Republican, said he agrees with Norquist that the problem in Washington is too much spending, rather than not enough taxation.

“He holds people’s feet to the ground,” Hatch said. “I love the guy because he works at it, and he is very dedicated about trying to get spending under control.”

Tom Ingram, who ran the successful campaigns of Tennessee Senators Lamar Alexander and Robert Corker, said he advises his clients to avoid Norquist’s pledge. They usually don’t listen.

“Grover is kind of like a pain in the back,” Ingram said. “You’re very aware of him, but you kind of wish he’d go away.”

Norquist won’t say where ATR gets its money, other than that about half comes from wealthy people and corporations and half from small, individual donations.

Its goal is to cut the size of government -- including federal, state and local -- in half over the coming decades. Federal spending now stands at almost 25 percent of GDP.

Elegance in Simplicity

Budget expert Maya MacGuineas said Norquist’s pledge only deals with one side of the equation.

“It’s just so elegant in its simplicity,” said MacGuineas, president of the Committee for a Responsible Federal Budget at the New America Foundation, a nonpartisan research group in Washington. “It’s like saying no paying your credit card bill.”

Still, MacGuineas said, history may be on Norquist’s side in the current budget debate, at least in part.

“The problem is now, legitimately, a spending problem,” she said.

While most budget experts and economists agree that to reduce the deficit for the long term will require both spending cuts and higher taxes, Norquist doesn’t see it that way.

“If it’s not mentioned in the Constitution, that is a strong argument that American taxpayers should not be paying for it.”

To contact the reporter on this story: Alison Fitzgerald in Washington at afitzgerald2@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.