ep. Bill Archer from Texas uses his position as House Ways and Means Committee chairman to stake out an image as a strong opponent of presumably Democratic tax-hike policies and as the ultimate defender of business interests within the pro-business Republican party.

Archer has led GOP attacks on President Clinton whenever the Administration has proposed a tax increase, even one used to offset the revenue loss from proposals that are generally viewed as favorable to business interests.

For instance, when the President recently proposed a revenue-neutral tax simplification package containing reforms and initiatives designed to make complying with the tax code easier for business owners and individuals, the chairman objected to the tax increases that offset the cost of the package. Instead of making the plan revenue-neutral through the use of revenue-raising measures, the chairman suggested the tax hikes be dropped and that spending cuts instead be used to pay for the plan.

Even within the tax-fighting Republican party, Archer has staked out a reputation as a legislator whose zeal for battling taxes is unsurpassed. When House Budget Committee Chairman John Kasich, R-Ohio, expressed support for ending "corporate welfare," it was Archer who took the lead on both jurisdictional and philosophical grounds and tried to push Kasich from the limelight.

Despite the chairman’s rhetoric, Archer’s only two significant tax actions so far this year were to favorably advance tax increase bills. In the beginning of the year, the House Ways and Means Committee approved legislation extending the 10% airline ticket tax until Sept. 30, 1997.

In his only other major action in 1997, Archer introduced a revenue-raising bill, H.R.1365, that would cut off tax-free corporate spin-offs under Section 355. Businesses for decades have used this technique to restructure their operations in a way that minimizes taxes. Now, Archer, who says the current system of double taxes on corporate income is wrong, has introduced a bill to make sure corporations do not avoid that double tax system he opposes.

With the bill, which closes down both aggressive leveraged and plain-vanilla non-leveraged corporate spin-offs using Section 355, Archer has angered many practitioners for going at least one step further than Clinton, who included a similar measure in his budget request.

The apparent conflict between Archer’s rhetoric and his actions should not be a great surprise. While maintaining his opposition to tax hikes, the chairman expressed support for closing some loopholes. Any "anachronistic" provisions in the tax code should be hunted down and eliminated, Archer said. (Politicians often use terms such as "loophole closers," or "base broadeners," as euphemisms for tax increases.)

One example offered by Archer is the tax credit for the production of ethanol. Although producers of conventional fuels may see the credit as a loophole, ethanol producers probably would see repeal of the credit as a tax increase.

Although it is tempting to agree with a portrayal of Democrats as evil tax increase addicts and Republicans as defenders of our pocketbooks, the truth is less clear. The job of committee chair brings with it the tasks of budget balancing, abuse prevention, loophole closing, and, in many cases, justifying the inevitable tax increases with appropriate rhetoric.

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