House Tax Chief Pitches No-New-Revenue Plan to Wary Voters

Representative Dave Camp’s summer- recess ritual of visits with constituents at a retirement home, the Rotary Club and an airport construction site was punctuated this past week by voters’ misgivings about the deficit fight in Washington in which Camp plays a central part.

As he crisscrossed his hometown district of Midland, Michigan, on Aug. 25, the chairman of the House Ways and Means Committee repeated to residents -- some of whom he has known since childhood -- his promise not to raise taxes to cut the deficit. The 11-term Republican House member encountered voters who supported him while expressing doubt that Congress can tackle a $1.3 trillion budget deficit.

“They need to grow up and get together,” John Church, a retired Midland retailer, said of Congress. Camp, he added, “has a lot of work ahead of him.”

Camp, who turned 58 in July, discussed the delicate balance he faces in the months ahead on the panel and as leader of the tax-writing committee. He insists a tax overhaul shouldn’t emerge from the supercommittee, though he wants to use his spot on that panel to keep the issue prominent in 2012. He supports tax policies being advanced by House Republican leaders while keeping his focus on a comprehensive rewrite of the U.S. tax code.

Representative Dave Camp meets voters before giving a speech at a Rotary Club meeting in Midland, Michigan on August 25, 2011. Photo: Adam Bird/Bloomberg Close

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Representative Dave Camp meets voters before giving a speech at a Rotary Club meeting in Midland, Michigan on August 25, 2011. Photo: Adam Bird/Bloomberg

Rotary Club Speech

Among the stops on Camp’s appointment-packed day with constituents was one to listen to representatives from companies including Hewlett-Packard Co. (HPQ), Qualcomm Inc. (QCOM) and International Business Machines Corp. (IBM) press for a tax code more in line with other countries. At a lunchtime speech to the Midland Rotary Club, he explained how the supercommittee will work and also stumped for a tax code overhaul that wouldn’t include revenue increases.

After the speech, he was asked by a voter whether Congress should get an overhaul to become more responsive. Camp said he is optimistic that the supercommittee might emerge as a model for tackling big issues.

“The question is really how can we reform the process,” Camp said. “The creation of this joint committee might be a path forward.”

In a series of interviews over the course of the day, Camp said his optimism about the panel stems in part from the power given it to write legislation and that its work is guaranteed a vote on the House and Senate floors, bypassing committee hurdles and procedural maneuvers that can hobble most legislation.

’Something New’

As Congressman Dave Camp crisscrossed his Michigan district and hometown of Midland on Aug. 25, the chairman of the House Ways and Means Committee reiterated the point that he wouldn’t support tax increases as part of deficit-cutting efforts. Photo: Adam Bird/Bloomberg Close

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As Congressman Dave Camp crisscrossed his Michigan district and hometown of Midland on Aug. 25, the chairman of the House Ways and Means Committee reiterated the point that he wouldn’t support tax increases as part of deficit-cutting efforts. Photo: Adam Bird/Bloomberg

“We’re trying something new here,” he said.

The supercommittee is a product of the legislation that allowed the debt ceiling to increase and includes automatic spending cuts that are triggered in 2013 if a majority of the panel doesn’t reach agreement.

Camp’s constituents in Midland, a town of about 40,000 residents and the headquarters of Dow Chemical Co. (DOW), said they look to Washington with skepticism, though they expressed support and respect for their hometown congressman.

“They view Congress as being way off and just concerned with what happens in the Beltway and not what happens in the hinterlands,” said Sid Allen, the president of the Midland Area Chamber of Commerce.

As he wrapped up a visit to a retirement home late in the day, Camp was stopped by a woman who asked whether Social Security was going to run out in 2015, a prospect that Camp promised won’t happen. Entitlement programs “are always key on people’s minds, even more so today,” he said later.

Dow Diamond

Dow is Midland’s largest employer, with a staff of 5,300 in the county, according to Midland Tomorrow, a local economic development group. The company’s presence is hard to miss. It donated land for an imposing minor-league baseball stadium, called Dow Diamond, near downtown. A few miles away, visitors can browse Dow Gardens, a botanical garden founded in 1899 by the company’s founder, Herbert Dow.

Congressman Dave Camp discussed the delicate balance he faces in the months ahead on the panel and as leader of the tax-writing committee at a Rotary Club meeting in Midland, Michigan on Thursday, August 25th, 2011. Photo: Adam Bird/Bloomberg Close

Congressman Dave Camp discussed the delicate balance he faces in the months ahead on... Read More

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Congressman Dave Camp discussed the delicate balance he faces in the months ahead on the panel and as leader of the tax-writing committee at a Rotary Club meeting in Midland, Michigan on Thursday, August 25th, 2011. Photo: Adam Bird/Bloomberg

Camp’s largest campaign donations between 2009 and 2010 came from Dow’s political action committee and company employees, with contributions totaling almost $46,000, according to the Washington-based Center for Responsive Politics, which tracks campaign-finance data.

“It’s obviously important to have a large employer, a large international company here,” Camp said.

On tax issues, Camp said he usually hears from Dow through coalitions or trade groups. He said Dow doesn’t get more attention from him than other businesses in his district.

1990 Election

Camp grew up in Midland, which lies near Lake Huron, about 120 miles northwest of Detroit. The district, which Camp won with 66.2 percent of the vote last year, stretches through rural areas up to Traverse City in the northwestern corner of the state.

He was first elected to Congress in 1990, entering the House of Representatives in the same freshman class as John Boehner of Ohio, who is now the speaker of the House.

Camp, a lawyer, rose up through the Ways and Means Committee and became its top Republican in 2009. He took over as chairman this year, following the House’s shift to Republican control in the 2010 elections.

In Congress, Camp generally takes pro-business positions. He strays occasionally from the majority of House Republicans. For instance, last year he was one of six House Republicans who voted for a bill that provided a tax break to companies for hiring long-term unemployed workers.

’Conservative Community’

Jon Lynch, Midland’s city manager, said residents are paying close attention to Camp’s work on tax policy. They recognize that he faces calls from Democrats to raise revenue to reduce the deficit and aren’t overtly opposed to that if a case can be made that the money is being put to good use, Lynch said.

“This is a relatively conservative community,” Lynch said. “I don’t think you hear a strong ‘no taxes for any reason’ message but people want to know that the resources are being provided for reasonable services and are being used wisely.”

Camp is pressing for a tax code overhaul that would lower the top tax rate for businesses and individuals by 10 percentage points to 25 percent. He is tightly focused on reaching that goal. Camp wouldn’t say which tax benefits he would eliminate to offset the cost of lowering rates by that degree.

Repatriation Holiday

Other Republicans, including House Majority Leader Eric Cantor, a Virginia Republican, have called for more immediate measures, including a repatriation holiday that would allow companies such as Pfizer Inc. (PFE) and Google Inc. (GOOG) to return as much as $1 trillion in overseas cash to the U.S. at a lower tax rate. Cantor also said on Aug. 23 that the House would repeal a law that imposes 3 percent tax withholding on government contracts.

Camp said he supports each of these policies. He isn’t leading the Republican effort for them, however, because he wants to stay focused on a comprehensive tax overhaul, he said.

“I don’t want to get engaged in all these individual tax provisions because I think the goal ought to be reforming our fundamental tax system,” he said.

Camp said he is open to including language in the legislation that emerges from the supercommittee to require Congress to pass a tax overhaul within a specific time frame. He said he could see a scenario where the panel calls on Congress to act in 2012.

Tax Overhaul

“That’s certainly possible,” he said. “You could certainly have some sort of approach that would have a date certain for tax reform that would be outside of the 100-day window” for developing deficit reduction legislation.

Camp rejected the idea that it would be impossible to restructure the tax system during an election year and noted that President Bill Clinton revised welfare laws in 1996 as Clinton waged a re-election bid. Clinton vetoed two versions of the welfare overhaul before an agreement was worked out with Republicans in Congress, providing Camp with a lesson he relies on as he presses for a new tax code today.

“Don’t give up,” he said. “I don’t think you stop trying to do the right policy.”

To contact the reporter on this story: Steven Sloan in Washington at ssloan7@bloomberg.net

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

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