If all your friends jumped off a fiscal cliff, would you go over after them? Apparently some congressional Democrats are considering it, reasoning that failure to deal with the nation’s “perfect storm” of spending and revenue problems would be politically more damaging for Republicans than themselves.
The question of whether the US should procrastinate or finally confront the tangle of expiring tax breaks, unfunded entitlement programs, sequestration cuts, and Obamacare expenses we call “the fiscal cliff” seems like a no-brainer – until you introduce politics to the mix.
The Democrats’ calculus is based on last cycle’s election results, which saw GOP hopes at retaking the Senate and White House go up in smoke. While much of that can be attributed to a slate of weak candidates and ham-fisted messaging, liberals also view the returns as a mandate on their style of budget control. For example, a CBS poll released recently shows support for President Obama’s plan to raise taxes on the wealthy, with 58% of Americans (including 52% of self-described “upper income” respondents) saying the rich should pay more. That kind of public support has emboldened Democrats like Rep. Peter DeFazio of Oregon, who said:
“If the Republicans can’t see their way to significant additional revenues targeted toward the people who are best off and targeted toward passive income and other things like that, then we’re better off going over the cliff and readdressing this with a better Congress in January. And we would have plenty of time to fix it.”
DeFazio joins a loud chorus of congressional liberals when he says he’d be willing to leave the debt problem unsolved. For example, Washington Senator Patty Murray has indicated that since it would be easier for Democrats to raise taxes after the deadline for dealing with the cliff expires, they may as well wait until then to do anything.
Murray and others are gambling, of course, that failing to deal with taxes, welfare reform, and defense spending yet again will have little impact on the economy. We can chalk that assumption up to ignorance, because it’s simply wrong – Fitch has already promised to downgrade the US credit rating again if no action is taken, and weak markets would freeze up when slapped with across-the-board tax increases. But more unsettling is the indication that Democrats would rather play politics with our nation’s major financial problems than actually solve them.
Republicans are finally beginning to offer a compromise to close the gap between taxes and spending, and prominent members of both chambers have indicated that they’re willing to walk away from the “no-tax Norquist” pledge they signed earlier in exchange for a serious swing at entitlement reform. This is the exactly kind of posturing Democrats have been seeking for almost two years.
It seems strategically stupid for Democrats to ignore the compromise they’ve so prized to tar the GOP two years away from the next election. That’s why I think some of these comments are just hot air, and that we will see some kind of agreement before January to at least put a dent in the debt. The benefits for both parties would be immense if they could achieve a deal in which each side got something they wanted – far greater than the left dragging the country over the cliff and blaming the right for leaving the parachutes at home.