Will Barack Obama take a page out of Ronald Reagan’s recovery in his next strategy to triangulate resurgent Republicans on Capitol Hill?  The New York Times reports that Obama and the White House may champion tax reform, aiming to lower rates while closing loopholes in order to generate a net revenue gain for deficit control:

While administration officials cautioned on Thursday that no decisions have been made and that any debate in Congress could take years, Mr. Obama has directed his economic team andTreasury Department analysts to review options for closing loopholes and simplifying income taxes for corporations and individuals, though the study of the corporate tax system is farther along, officials said.

The objective is to rid the code of its complex buildup of deductions, credits and exemptions, thereby broadening the base of taxes collected and allowing for lower rates — much like a bipartisan majority on Mr. Obama’s debt-reduction commission recommended last week in its final blueprint for reducing the debt through 2020.

Doing so would offer not only an opportunity to begin confronting the growth in the national debt but also a way to address warnings by American business that corporate tax rates and the costs of complying with the tax code are cutting into their global competitiveness.

Mr. Obama signaled his inclination in off-the-cuff remarks on Wednesday as he was defending the tax cuts deal negotiated with Congressional Republicans this week. “We’ve got to have tax reform,” he said.

A key part of Reagan’s recovery — although by no means the only reason for it — was tax-code simplification.  Loopholes got closed, but more importantly, rates were lowered and consolidated into three tiers.  That lowered costs for compliance, allowed businesses and individuals to plan for investment with more confidence, and (not coincidentally) took away some of Congress’ power to tinker with social engineering through the tax code as well.

Such a move would certainly go a ways towards “repair[ing] his strained relations” with the business community.  Would he call them “hostage takers” at the end of the process, though?  That approach didn’t work out very well in this last triangulation attempt.

Politico sounds skeptical that tax reform and lowering rates would take any prominent position in the White House agenda next year:

President Barack Obama has asked his economic advisers to prepare options for a comprehensive tax reform plan that would limit deductions, lower rates and cut the budget deficit, but the White House played down the idea that the president would put this high on his agenda next year. …

The president’s top economic advisers have yet to meet on tax reform, and the White House hasn’t placed a time frame on the decision to move forward. Changes in the tax code was among the general recommendations made last summer by the president’s Economic Recovery Advisory Board, a team of outside advisers, and three options for tax reform were presented to the president Nov. 30. in a draft report by the bipartisan deficit commission.

Politico also hints that the Times may have been chosen for the trial-balloon leak because of a recent David Brooks column, in which Brooks suggested that Obama seize this issue as a means to restore his standing in the middle.  Brooks even envisioned a scene from a State of the Union address in which Obama shows a stack of thousands of sheets of paper and dramatically says that he’s scrapping the tax code.  That certainly sounds good, and would be an arena of potential bipartisanship, but it would depend on exactly how Obama envisions tax reform.  The move would be welcome, and would also advance the GOP’s agenda of tax reform.

However, Obama will still have a long way to go to becoming Reaganesque.  First, tax rates are probably as low as politically possible at the moment, at least in terms of political feasibility.  If the tax reform ends up taking more money than present, it won’t be very stimulative, if at all.  In order to achieve real and significant growth, Obama will have to do what Reagan did, which is to reduce the regulatory burden on business, especially manufacturing, in order to make the US competitive for long-term investment.  Since Obama has done nothing but signal his desire to expand regulatory reach in order to achieve the goals that the midterms put out of reach legislatively — cap and trade and Card Check being among them — the mantle of Reagan will remain out of reach.