Through a series of circumstances that Shaw observes -- an unorthodox idea from some Democrats to temporarily allow the government to go over the fiscal cliff to give the party more bargaining leverage, combined with polls that show the majority of voters still wanting Bush-era tax cuts to expire for top earners, as well as Republicans shouldering the brunt of the blame over Democrats and the President if those tax rates expire for everyone -- he basically thinks it works out to a win-win for Obama.
Yes, he could look like the great peacemaker and try to strike some sort of grand bargain with Boehner. And if he did, he would likely get some of what he and the Democratic majority want in exchange for taking a slightly less than maximum raise on taxes for the most wealthy. But why?
If he takes a very hard line and forces the showdown to a collapse in discussions, several potentially positive (for him) results are baked into the cake. He can claim that Republicans refused a “balanced approach” and it’s their fault that everyone’s taxes went up. He then has the Democrats force a vote on a bill to only lower taxes on the middle class and the poor and just dares the GOP to vote against it. (They won’t.) At this point he has the tax / revenue increase he promised without giving up a single thing. Now the negotiations start anew to talk about “spending cuts” but the GOP’s major bargaining chip is gone. Obama gets to put up a far more shallow version of cuts, and if the Republicans don’t like it, they can choose to reject the deal and just let the deficit continue to skyrocket.
What Republican in their right mind could go for this? Perhaps more than we might think. ... Just as I’ve been saying since earlier this year, if you needed congressional action to raise taxes it would never happen. But in this case, to raise tax rates all you need is for Congress to do nothing. And when you need nothing done, there’s no better crack team than Congress. And once the taxes are up, even the GOP reps who have signed the Norquist pledge are free to sign a bill that lowers taxes… even if that doesn’t apply to the wealthy. They get to remain covered on their voting record in their home districts and blame the fallout on the Democrats.
The thing with that scenario, though, is that the top earners (the entrepreneurs, the real job creators) are then given a larger opening to pull up stakes and seek less taxing business environments in other parts of the world. Also, as an aside, why is it always lost in the messaging that the Bush-era tax cuts are actually the current rates and have been for the past decade?! So, extending them for all, except the top earners, simply keeps them the same for us, while raising taxes on the job makers. Another incentive to relocate...and take the economy and employment with them.
ADDENDUM: Ed Morrissey adds to the conversation, supplying numerous sources pointing to Republicans folding to an increase in taxes on top earners in exchange for the promise of tax and entitlement reform mechanisms next year. Rinse, repeat, Republicans...
In the current political line-up, that’s probably the best the GOP can do without playing chicken all the way to the cliff with Democrats. If voters wanted a better deal, they would have replaced more of the players two weeks ago.
On the other hand, Marc Theissen approaches the fiscal cliff differently: let's go over it!
WaPo: Here’s an idea for how to start the New Year in a bipartisan fashion: Let’s go over the fiscal cliff!
Today, the only ones in Washington who advocate fiscal cliff-diving are liberal Democrats. It’s time for conservatives to join them. Letting the Bush tax cuts expire will strengthen the GOP’s hand in tax negotiations next year, and it may be the only way Republicans can force President Obama and Senate Democrats to agree to fundamental tax reform.
At least going back to the Clinton rates would put more people on the tax rolls, and give more Americans a stake in constraining government spending. It would also force all Americans — including the middle class — to pay for growing government services, instead of borrowing the money from China and passing the costs on to the next generation.
Americans had a choice this November, and they voted for bigger government. Rather shielding voters from the consequences of their decisions, let them pay for it.
He's got a point.
