Harry Reid, citing Romney case, says fixing tax code ‘has become an emergency’

By Karoun Demirjian

Wednesday, Jan. 25, 2012 | 3:27 p.m.

WASHINGTON — White House advisers insisted that President Barack Obama’s State of the Union address Tuesday night was not an attempt to answer his critics or draw distinctions between himself and the Republican candidates trying to unseat him in 2012.

But lines between politics and policy these days are pretty mushy, and Wednesday morning, Democratic Senate leaders said that the Republican presidential candidates are precisely why there’s urgency behind moving some of the president’s policy proposals — especially the ones that have to do with taxation.

“The Republican presidential front-runner is a perfect example of what’s wrong with the tax code,” Sen. Harry Reid said. “An individual who makes $43 million and pays a tax rate of 15 percent suggests that maybe things need to be changed a little bit.”

In his speech, the president defined the so-called Buffett rule, named after the billionaire who came out last year to say the rich ought to be paying more in taxes, as such: Anyone earning over a million dollars ought to have at least a 30 percent tax rate.

Democrats have been trying for months to embrace the spirit of the Buffett rule, which they define as getting millionaires and billionaires to “pay their fair share.” They tried to work it into the debt ceiling and deficit reduction agreement this summer. They tried to weave it in as surtaxes to off-set the cost of pieces of the president’s jobs bill.

It hasn’t yet worked — so why would it now?

When asked Wednesday morning, Reid gave one reason: Mitt Romney.

“All you have to do is look at the former governor of Massachusetts’ tax return — and that’s why this has become an emergency,” Reid said. “Too many families in Nevada and across the country wake up every morning wondering why the opportunities for them and their children are so scarce. Then they look at the top 1 percent and find that they have a tax rate lower than what they pay.

“The system seems to be rigged in their favor ... it’s only fair to ask why people making millions shouldn’t pay their fair share.”

Sen. Charles Schumer, appearing with Reid, warned reporters “don’t be surprised” if Republicans started cooperating more with Democrats’ proposals because of election-year pressure.

It’s a taste of what’s sure to come from Democrats if Romney wins the Republican nomination. He’s currently battling it out with former House Speaker Newt Gingrich in Florida; the caucus contest then comes to Nevada on Feb. 4.

This week, though, it’s still about the State of the Union, as Obama takes his message on the road. He’ll be talking about energy in Las Vegas Thursday morning.

But there’s a warm-up act today: Housing Secretary Shaun Donovan will be appearing in Las Vegas Wednesday afternoon to talk about consumer credit counseling. It’s all leading up to a housing bill the president said he’ll be transmitting to Congress soon.

The plan “gives every responsible homeowner the chance to save about $3,000 a year on their mortgage ... no more red tape, no more runaround from the banks,” in his speech Tuesday night.

Reid didn’t give any more details about the forming plan Wednesday morning, nor indicate what he planned to do with the bill once he received it from the White House. But he said he was looking forward to the results of Donovan’s visit, which includes meetings that Reid helped set up.

“I’m tremendously interested (to see the bill),” Reid said Wednesday, adding that he’s spoken to Donovan several times in the past few days. “I told him that I hope something is coming very quickly.”