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Is this really a raw deal for Democrats?

The deal put an end to the stalemate in Washington, but it did not actually do much in terms of policymaking

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I’m annoyed, too, but I’ve been annoyed with the Democrats’ (including most importantly President Obama’s) position on the Bush tax cuts for years. And I am more hopeful about the “second round” possibilities than Bill is. For one thing, Speaker Boehner spelled out his interpretation of the “no new taxes” pledge in his powerpoint presentation on “the deal.” It calls for tax reform that sticks to the “current-law baseline,” suggesting that that prevents taxes from being raised. But that only prevents revenue levels from coming up relative to current law, which has all of the Bush tax cuts expiring at the end of 2012. It certainly doesn’t rule out revenues coming up relative to current policy, which is fully-extended and deficit-financed Bush tax cuts. There’s a difference between the two standards that’s worth $2.5 trillion over ten years by the Bush tax cuts alone. So there’s a lot of room for a second round of deficit reduction–I mean deficit reduction relative to “current policy” only, not current law–that’s quite heavy on the revenue side of the budget, if this is where Boehner means to go with this.

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This would turn out to be quite a good deal for the Democrats who want revenues to be an important part of the solution. It would raise revenue and reduce the deficit even more than President Obama himself has ever proposed. So maybe we shouldn’t consider “the deal” as one where Democrats gave away everything to the Republicans. I think they’re genuinely negotiating with themselves, too. And Republicans will have to come to grips with what they as a party really mean by “no new taxes.” Perhaps the most important negotiations over the next few months leading up to the “next round” of policy agreements will be within each of the political parties rather than between them.

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