Through the first eight months of the Trump presidency, the White House and Congressional Republicans have yet to score a major legislative victory. In the lead up to the 2018 midterm elections, the target for such a victory appears to be tax reform. However, there are significant obstacles impeding a successful tax reform effort. The Republicans face major procedural roadblocks, all of which can generate “hostage-taking” by groups within the Democrat and Republican parties, who will seek to exploit the narrow Republican majorities to achieve their own ends. In addition, ever since the “Big Six” scrapped the idea of a border adjustable tax (which would have potentially raised over $1 trillion
in revenue) in its recent joint statement
, it is unclear where the revenue will come from to finance the costs of the tax cuts Republicans are planning. Despite these hurdles, the authors believe that President Trump and Republicans in Congress will do everything they can to make tax reform happen, given the potential electoral payoff for success and the potential downside of failure.