Are Republicans preparing to cave in their “fiscal cliff” talks with President Obama? That’s what some media reports now suggest. Wednesday’s New York Times, for instance, says senior GOP leadership aides are contemplating whether to abandon their opposition to higher tax rates for the wealthy. Conservative political correspondent Byron York of The Washington Examiner says flatly that retreat will happen. The only questions are when and what sort of reductions in Medicare, Medicaid, and other big entitlement programs Republicans might demand in return.
Republicans and Mr. Obama have been at loggerheads over the taxes-for-the-rich question almost from the moment the latter took office. After all this time, and so much rhetoric, why would the GOP give up now on the central issue in the fiscal cliff talks?
In arms control terms, one reason might be that the administration has conveyed a credible threat of escalation. In other words, Obama has threatened to go ahead and plunge off the “cliff” and allow automatic tax increases and spending cuts to occur if the rich’s tax rates don’t rise – and top Republicans believe him.
They believe him not because they think he’s a tough hombre but because they understand that the White House fears the “cliff’” less than they do. Many Democrats would be happy to see the Bush-era tax cuts expire, while many Republicans would see that as a catastrophe. Plus, if Obama and House Speaker John Boehner plunge arm-in-arm over this fiscal Reichenbach Falls, more voters would blame the GOP for intransigence than the administration. That’s what polls show, anyway.
Conservative analyst William Kristol frames it this way in an essay for The Weekly Standard: “Might it be prudent for Republicans to acquiesce, for now, to a modified version of Obama’s proposal to keep current income tax rates the same for 98 percent of Americans, while also insisting on maintaining the reduced payroll tax rate of the last two years ... and reversing the dangerous defense sequester? That deal would be doable, wouldn’t wreck the country, and would buy Republicans time to have much needed internal discussion and debates about where to go next.”
But before Democrats start planning their tax-rate victory parties, we’ve got a couple of comments. The first is that it’s one thing for the GOP leadership to give in. It’s another for such a compromise deal to pass the House. As Mr. Kristol notes in the essay cited above, many rank-and-file House Republicans have pledged to never vote for a tax increase, and they might not be in the mood to start now.
Speaker Boehner, in a press conference Wednesday, made something of the same point.
“If you look at the plans that the White House has talked about thus far, they couldn’t pass either house of the Congress,” he said.
Second, all the stories about Republicans preparing to fall back might be coming from a few Republicans who think that’s the party’s best course of action and are trying to convince their colleagues of that fact. They call this “floating a trial balloon,” and the current run of tax stories might be a big, helium-filled rubber sphere vulnerable to tea party adherents with darts.
After all, with a few exceptions, the Republicans who speak on the record about raising tax rates on the rich are either moderates (Sen. Olympia Snowe of Maine), lawmakers who have promoted this for some time (Sen. Saxby Chambliss of Georgia), or pundits (Kristol).
In public, the Republicans who count still deny they’re thinking of retreat. “An obsession to raise taxes is not going to solve the problem. What will solve the problem is doing something about the entitlements, taking on the wasteful spending in Washington,” said House majority leader Eric Cantor at Wednesday’s GOP press conference.
While that effort ultimately proved in vain – the treaty was defeated by conservative Republicans – Mr. Dole’s appearance in some ways served as a timely symbol of the larger battle going on within the GOP.
The former GOP majority leader, who has recently been hospitalized, just so happened to visit at a time when his party is struggling with a sharp, public rift over the “fiscal cliff.” Lines have been drawn between traditional “establishment” members – call them Dole Republicans – who tend to be more pragmatic and inclined to compromise, and tea party types determined to hold the line on taxes and spending.
Dole was a key player in Washington’s last big, bipartisan deficit-reduction deal: He helped construct the 1990 agreement in which President George H.W. Bush famously broke his “no new taxes” pledge in return for promised concessions from Democrats on spending and entitlement reform. That bill proved to be instrumental in reducing the deficit in coming years – though Mr. Bush never got credit, since he lost reelection to Bill Clinton, a fate conservatives have linked ever since to Bush’s tax heresy.
Since then, the party has shifted further to the right, with most Republican lawmakers signing on to Grover Norquist's pledge to never raise taxes. But lately, there have been signs of a possible countershift, as more Republicans appear open to the notion of tax hikes in some form.
As Washington wrestles with dire choices on taxes and spending, the big question is whether, in the current GOP, old-school dealmakers like Dole are little more than a dying breed – or if they may, in fact, become ascendant once more.
Certainly, in recent years, it has seemed more like the former. One after another, members of the old guard – like outgoing Sen. Richard Lugar of Indiana and former Sen. Bob Bennett of Utah – have been ousted by challengers on the right, largely over fiscal matters. But in some cases (such as Senator Lugar’s), those primary challengers wound up leading the GOP into embarrassing losses – which has lately led to new cries for the reassertion of a stronger pragmatic wing.
In an opinion piece in Monday’s New York Times, former Republican National Committee research director David Welch wrote: “Republicans must now identify those who can bring adult supervision back to the party.... Dare I say it, or should I just whisper the word? We need 'the Establishment.' "
While conservative groups like the antitax Club for Growth are still threatening to fund primary challenges against lawmakers who don’t hold the line on taxes, those representing the more establishment wing – like GOP strategist Karl Rove – are now indicating they may play a bigger role in primaries as well, Mr. Welch notes.
House Speaker John Boehner’s decision Monday to strip several conservative House members of plum committee assignments may also reflect a new assertion of strength in the party’s pragmatic wing.
The intraparty battle is far from over, of course, and the ultimate winner may not be known for some time. But at the moment, there seems to be at least some political wind at the back of the Dole Republicans. And that in itself is not insignificant.
It’s true: Kentucky Democrats are talking up actress/activist Ashley Judd as a possible candidate for Senate in 2014. Ms. Judd, an eighth-generation Kentuckian, was a delegate to the Democratic National Convention this summer and is a big fan of President Obama, so it’s not like this is a completely wacky idea. So far, Judd isn’t saying “yes” to a run, but she isn’t saying “no,” either.
“I cherish Kentucky, heart and soul, and while I’m very honored by the consideration, we have just finished an election, so let’s focus on coming together to keep moving America’s families, and especially our kids, forward,” Judd told Us Weekly last month.
Charlie Cook’s Political Report website lists Judd as a possible Democratic nominee in the Kentucky race, so the D.C. punditocracy is paying some attention to this scenario as well.
If she runs, the GOP opponent would be none other than Senate minority leader Mitch McConnell, one of the top Republican lawmakers in the United States. Democrats would love to knock off Senator McConnell, in part because in 2010 he said the most important thing the GOP could achieve would be “for President Obama to be a one-term president.”
Would Judd have a chance against such an experienced and hard-nosed politician?
Well, she’d certainly attract a lot of attention. As a genuine star who has portrayed Marilyn Monroe (in 1996’s “Norma Jean & Marilyn”) and costarred in a Cole Porter biopic (2004’s “De-Lovely”) and a movie about the tooth fairy (2010’s “Tooth Fairy”), she’d have little trouble raising money from Hollywood liberals. Plus, this is a plot that’s played out on the national stage before. Two words: Al Franken. Senator Franken (D), a professional comedian, knocked off incumbent Norm Coleman in Minnesota in 2008.
So Democrats can dream, can’t they?
Yes, they can. But eventually they’ll have to open their eyes and see that Judd’s prospects of beating McConnell aren’t good.
First, it’s Kentucky, not Minnesota. It’s a Republican state. Mitt Romney took 61 percent of the vote there a month ago to Mr. Obama’s 38 percent. The aforementioned Charlie Cook Political Report already judges the 2014 Senate contest to “lean Republican.”
One reason Judd’s name is coming up is because other prominent Kentucky Democrats don’t want to run and get beat.
Second, Judd’s not just a Democrat, she’s a Hollywood Democrat. Her own grandmother recently called her a “Hollywood liberal.” The GOP has long experience in painting such folks as out-of-touch celebrity nitwits who want to nationalize health care while forcing everyone to drive electric cars with a top speed of 55 miles per hour.
(Yes, Judd is married to a race-car driver. But he’s Scottish and thus foreign, so that might be a wash, electorally speaking.)
Last, there’s the matter of bluegrass allegiance. It’s true that Judd’s family has deep Kentucky roots. But the state from which she was a delegate to the 2012 Democratic National Convention wasn’t Kentucky. It was Tennessee! She and husband Dario Franchitti split their time between a Tennessee farm and a home in Scotland. We’d bet that in Kentucky, the former domicile would be a much bigger political problem for her than the latter.
The back-and-forth over the so-called 'fiscal cliff' sounds a lot like "Groundhog Day" right now, as, day after day, each side accuses the other of failing to bring a serious proposal to the table, leaving the impression of a process that’s basically stalled.
And while we still tend to think that a deal will be struck before year’s end (Congress being essentially like newspaper journalists, needing the threat of an imminent deadline to get anything done), we’ve also been struck by the small-but-growing chorus of so-called “cliff divers” – partisans on both sides arguing that going over the cliff might actually be the most palatable option.
In many cases, of course, this kind of talk may just be part of the game of chicken, designed to scare the other side into making concessions.
But increasingly, some seem to be genuinely concluding that going over the cliff would in fact be the best choice – better than what they fear is shaping up to be a disastrous, hastily constructed deal on taxes and spending that would then be much harder to undo.
Initially, it was mostly those on the left voicing this argument – in part because that would actually accomplish one of their chief goals: ending the Bush tax cuts for the wealthy (and, the thinking goes, Democrats could then come back and reinstate the middle-class tax cuts in 2013). As far back as last summer, Sen. Patty Murray (D) of Washington said in a speech at the Brookings Institution: “I will absolutely continue this debate into 2013, rather than lock in a long-term deal this year that throws middle-class families under the bus.”
Lately, a number of voices on the right have been making essentially the same case. “Our preferred strategy here would be to accept the sequester now, knowing that Congress is not going to do something more rational – they’re not going to take on more fundamental spending reforms – and push off increasing taxes,” Matt Kibbe, president of the conservative advocacy group FreedomWorks, told MSNBC Monday morning.
Likewise, outgoing GOP Rep. Joe Walsh of Illinois, who has close ties to the tea party, told Bloomberg last week: “The thing that would be much worse would be to craft a bad deal that would do anything that raises taxes. Doing what’s right over the next couple weeks is more important than doing something that would harm our economy in the name of meeting a silly deadline.”
One other indication that the once “unthinkable” option may be becoming more widely “thinkable” is the shift in the language describing it. There’s been a deliberate effort in recent weeks to rebrand the fiscal “cliff” as more of a fiscal “slope,” with a number of lawmakers, as well as prominent investors like Warren Buffett, arguing that, counter to all the doomsday predictions, the US economy wouldn’t go off the rails in January if Congress failed to act. “It’s not like something cataclysmic happens on Dec. 31,” Sen. Bernie Sanders of Vermont told Politico last week.
That’s because many of the automatic cuts wouldn’t actually go into effect for another few months at least – giving lawmakers additional time to work out a solution in the new year. Likewise, the Internal Revenue Service would have some flexibility about when to implement the new tax rates, and could even retroactively reverse any tax hikes, if a deal is reached later on.
Of course, no one knows exactly how the markets would react if Congress did allow the country to go over the cliff (and most analysts agree the immediate consequences would not be good). But the rise in those arguing that any broad economic effects would likely be gradual – and more changeable – than has been often represented may be helping to make such an outcome more likely.
What’s the point of President Obama’s new proposal to end the “fiscal cliff” financial crisis? This question arises because Republicans seem genuinely startled and annoyed by the details of the plan. In their view, it’s a Democratic wish list instead of a starting line for serious negotiations.
Senate minority leader Mitch McConnell of Kentucky told The Weekly Standard he “burst into laughter” after hearing Treasury Secretary Timothy Geithner outline the plan. “Nothing good is happening” in the fiscal cliff talks, Senator McConnell said.
Let’s back up and examine Mr. Obama’s offer. As expected, it calls for $1.6 trillion in tax increases over 10 years. The president has long said that’s his dollar goal for new revenue and that raising rates on the top 2 percent of taxpayers is the only way to raise enough cash to get there.
But the proposal also calls for $50 billion in immediate stimulus spending, according to the GOP. This would pay for some new national infrastructure, the continuation of extended unemployment benefits, and a deferral of looming reductions in Medicare physician reimbursements.
(We’ll note that this last detail, the “doc fix,” is something that both parties have agreed to for years. Whether it counts as new stimulus spending is thus open to interpretation.)
Obama’s plan also calls for eliminating congressional votes to raise the debt ceiling – a shift in institutional balance of power that lawmakers of both parties might resist.
But what really appears to peeve Republicans is the lack of specificity on spending cuts. The White House proposal identifies some upfront reductions in some programs, but only in vague terms, they say. It does propose $400 billion in long-term savings from Medicare and other entitlement programs, but only as a goal. Specifics are deferred for later negotiations.
“Unfortunately, many Democrats continue to rule out sensible spending cuts that must be part of any significant agreement that will reduce our deficit,” said House Speaker John Boehner after Thursday’s meeting with Secretary Geithner.
Democrats say the other party is just acting the diva. Obama has talked publicly about pretty much all this stuff, they say, so nobody should pretend to be surprised.
But even some liberals say the list is loaded up with most of their favorite proposals. In this sense, it’s a compendium of many things the administration has been pushing. This could mean the White House is not trying to woo the GOP with upfront concessions. Instead, Obama appears to believe he’s entering these talks in a position of strength.
“This opening bid will cheer liberals – it strongly suggests the White House is willing to push Republicans very hard, in the belief that it has all the leverage,” writes left-leaning Greg Sargent in his Plum Line blog at the Washington Post.
Some on the right say all this means Obama has also decided he’s not that worried about actually reaching a deal. Instead, he’s decided that allowing automatic spending cuts and tax increases to kick in on Jan. 1 will only increase his leverage. The logic of this view runs this way: Polls show a majority of voters will blame the GOP if the United States dives over the cliff. The administration can then say any resultant weakness in the economy is Republicans’ fault, and Democrats would do better in the 2014 midterms than they would have otherwise.
Obama is “either indifferent about going over the cliff or now actively wants it to happen, and since he knows he can count on the press to scapegoat Republicans when it does, he’s decided to shoot for the stars with his ‘offer’ and see how desperate Boehner is,” writes conservative blogger Allahpundit on the Hot Air website.
However, our favorite guess here stems from game theory, which focuses on strategic decisionmaking. Perhaps the administration is trying to enter fiscal cliff talks in a position to both reach a deal and get most of what it wants.
One way to do this might be to lard up opening positions with lots of stuff you’d be willing to discard. This way, the other side gets “victories” when you agree to strike them, allowing it to save face in the final deal.
Opening positions are just that – openings. In that sense, the administration’s proposal could be both unrealistic and the opening to a solution.
Why did Vice President Joe Biden go shopping at Costco Thursday morning? He’s got a day job, after all. We’d have thought he might have spent the a.m. holed up in his White House office plotting strategy for “fiscal cliff’ talks. Or maybe preparing a greeting for Mitt Romney, who’s lunching Thursday with President Obama.
But no, Mr. Biden was out setting an example for holiday shoppers by priming the pump at the grand opening of the first Costco in Washington, D.C. Among other things, he bought cookies, children’s books, an apple pie, fire logs, and a 32-inch Panasonic TV. He tried some food samples. He declined to purchase a new set of tires.
“Hey man, I don’t need tires,” he said, according to the pool report. “I don’t drive anymore.”
QUIZ: Are you a smart shopper?
No, we’re not making that tire thing up. Sometimes reality needs no improvement.
Anyway, we can think of several serious reasons that a man who’s a heartbeat away from the most powerful job in the world might spend a few minutes checking out pallets of dress shirt three-packs.
The first is an obvious one: He’s rewarding a supporter. Costco co-founder Jim Sinegal endorsed the Obama ticket, held a fundraiser at his New York home, and even spoke at the Democratic National Convention. Mr. Sinegal was present Thursday as Biden appeared at Costco’s door. Undoubtedly he was pleased at all the free publicity about the new store he’s getting because of his administration friends.
But this wasn’t just an economic/political quid pro quo. Our second point is that the administration tries to promote Costco as an example of how US businesses should treat employees. Costco’s people are well paid (for retail), and the firm offers good health insurance. Sinegal himself took home $350,000 in the last year he served as CEO, which sounds like a lot but is about one-third of the average for firms of Costco’s size.
That’s why the DNC got him onstage in Charlotte, N.C. His speech didn’t get that much attention, as he’s not exactly a rousing orator, and it went on late. Maybe Biden’s visit is a way of trying to raise those issues again.
“At our company, we recognize that job creation requires time and investment and commitment to the long term,” Sinegal said in his convention speech.
Last, Biden may just have been boosting D.C. Or an area of the city underserved by retail, in any case. The new Costco that the VP visited looms on a cliff in the northeast part of the city near the Anacostia River and the border with Maryland. It’s a lower-income area called Fort Lincoln, where local officials have put together a new shopping area named the Shops at Dakota Crossing. Costco is the first big tenant to open. Shoppers Food Warehouse and Marshalls are supposed to follow.
D.C. officials have long lamented that city residents who don’t live in the prosperous northwest quadrant have few retail options and must drive to Virginia or Maryland to shop. In visiting Costco, Biden brought attention to a place where D.C. residents can spend their bucks in D.C. – keeping jobs and tax revenue within the city.
QUIZ: Are you a smart shopper?
As Republicans on Capitol Hill continue their public flogging of Susan Rice, the US ambassador to the United Nations, it’s hard not to notice that a more senior administration official – who, arguably, might bear more responsibility for what went wrong in Benghazi – has largely escaped criticism.
We’re referring, of course, to Secretary of State Hillary Rodham Clinton.
True, a handful of right-wing news outlets have raised questions about why Ms. Clinton’s department failed to heed earlier warnings about security concerns in Benghazi. But the top Republican senators driving this story have so far chosen to leave Clinton largely out of the discussion.
It’s a remarkable turnaround for a woman who, not too long ago, was seen as such a lightning rod that she could have easily been called “GOP Enemy No. 1.” Today, the secretary of State is the de facto Democratic frontrunner for the 2016 nomination (though she has not made a decision about whether to run) and seems almost – as Saturday Night Live’s Darrell Hammond once famously called her husband – “bulletproof.”
The lack of criticism directed at Secretary Clinton over Benghazi may be in part a reflection of her years in the Senate – a still-clubby institution that instinctively protects its own. Clinton only served two terms, but she made the most of her time there, reaching across the aisle and developing close relationships.
In particular, Clinton’s friendship with Sen. John McCain appears to be paying dividends. As Politico’s Scott Wong writes Wednesday, in a detailed examination of the warm relationship between the two, Clinton’s “decade-old bipartisan friendship with McCain appears to have helped shield her from GOP fire – even as her agency finds itself in the thick of a partisan battle over Benghazi.”
It may also indicate how sharp Clinton’s own political instincts have become. Notably, it was not Clinton who went out on the Sunday shows with those now-infamous talking points. As New York Times columnist Maureen Dowd wrote recently, Rice should have been “savvy enough to wonder why the wily Hillary was avoiding the talk shows.”
But Clinton also seems to be benefitting from a larger rehabilitation of her reputation that began even before her husband left office. She earned praise during her time in the Senate for buckling down and seeming to eschew the spotlight (“a workhorse, not a showhorse” was the oft-repeated phrase).
And as secretary of State, Clinton’s status has been elevated even more – in part because, for the first time in decades, she’s been front and center in a decidedly nonpartisan role. Her above-the-partisan-fray image probably also got a lift from the fact that she gamely went to work for a former rival who arguably took the presidency away from her.
In the job, she has earned kudos, again, for hard work – most recently, for her role in brokering a cease-fire between Hamas and Israel. And she’s shown a fun side, boogieing in South Africa, partying at a nightclub in Cartegena, and playing along with the “Texts from Hillary” blog on Tumblr.
Indirectly, Clinton may also be profiting from the warm public embrace that her husband – like many former presidents whose time in office has receded sufficiently into the past – has been receiving of late (that same Gallup poll found that Mr. Clinton was No. 3 on the list of most admired men).
Of course, a 2016 presidential run would likely bring Hillary Clinton’s reputation back down to earth. As Dee Dee Myers, Bill Clinton's former press secretary, recently told the Daily Beast: “Once she was running for office as a partisan – as a Democrat – again, as opposed to being the global figure she is, she’d lose a little bit of that luster.”
For now, however, that luster is proving awfully powerful.
Stilted conversation over scallops, anyone? President Obama has invited Mitt Romney to lunch at the White House on Thursday, and while we’re sure the food will be delectable, we’re not sure how much genuine communication will occur.
But is that really the point? Instead, both parties might just want a public burying of mutual animosities. It could be good for them, and the country. Perhaps this will become a US tradition, along with the presidential turkey pardon and the lighting of the White House Christmas tree. Every four years, the combatants in the just-past election will gather in the private dining room next to the Oval Office and air their grievances. (Yes, that’s a “Festivus” reference. If you don’t know what that means, look it up.)
But let’s back up a bit. The White House announced the meal Wednesday in a statement released by spokesman Jay Carney.
“It will be the first opportunity they have had to visit since the election,” said Carney, adding that there would be “no press coverage of the meeting.”
He means no press coverage of the actual words they exchange, of course. That’s because they don’t matter nearly as much as press coverage of the mere existence of the event.
Following his reelection Mr. Obama said nice things about his ex-opponent, including that he’d like to sit down with him and hear Mr. Romney’s ideas about how to improve economic prospects for middle-income Americans.
“He presented some ideas during the campaign that I actually agree with,” said Obama in his postelection press conference.
It behooves Obama to be gracious, of course. With large margins of Americans telling pollsters they want Democrats and Republicans to work together, the lunch offer is a big flashing light of a signal that Obama intends to do just that. Or look like he’s doing that, at least. It could set a tone of civil discourse that the administration may want to continue to project in the months ahead.
For Romney the lunch must now loom as a necessary but emotionally difficult task. Only weeks ago he thought the Oval Office would be his workspace. Now it’s just an exclusive cafe that’s deigned to admit him for a visit. It would be churlish for him to turn down the offer – good losing is part of sportsmanship, as anyone who ran the Olympics must know. But he would not be human if he didn’t look around and think how his own family portraits would have looked on that desk.
By accepting Obama’s offer Romney, too, shows that he understands Americans want their politicians to work together. The running-for-office part of his own career may be over, but he bolsters the Republican brand by appearing, which could help in “fiscal cliff” negotiations. And Romney needs to rebuild his status within the GOP, as well as within the country – lots of Republicans have complained about his campaign, and his postelection analysis that Obama won by giving people “gifts.”
A photo of the two 2012 opponents deep in conversation over fennel and endive salad could provide a better coda for Romney’s losing effort, perhaps counteracting some of the bitterness evident in the “gift” remark.
Sixty percent of Americans support raising levies on those with incomes over $250,000 a year, according to the survey. Meanwhile, reducing the deductions that people can claim on their income taxes was a much less popular move, opposed by a plurality of 49 percent of respondents. And raising the age of eligibility for Medicare? That’s a downright downer, with 67 percent of respondents rating that “no thanks.”
So this clarifies the political situation, right? President Obama’s solution wins, Speaker John Boehner needs to cave, taxes on the rich rise, Republicans and Democrats walk arm in arm out of the Capitol to a bipartisan catered lunch at the Hawk and Dove.
Nope. In fact, the data within this poll and similar recent surveys shed some light on why it’s so hard for the two parties to agree on solutions to the major money problem now facing Uncle Sam.
Dig into the Post/ABC data, and you find that Democrats and independents by large margins back raising rates on the wealthy. But Republicans oppose it. Fully 59 percent of self-described members of the GOP think this move would be a bad idea.
A new YouGov survey on attitudes toward the Grover Norquist Taxpayer Protection Pledge shows a similar partisan split. (You know what the Norquist pledge is, right? It’s supposed to bind signees to vote against any and all revenue increases. Virtually all House Republicans are adherents.)
Among Democratic respondents to the YouGov poll, a plurality of 35 percent say that any lawmaker who breaks the pledge to vote for tax hikes in the current situation should be commended. Republicans are just the opposite: A plurality of 40 percent say such a move should be criticized.
What does this mean? That as politicians elbow one another for position prior to hard negotiations, both sides may be representing the opinions of their constituencies at the moment, as opposed to being obstreperous for the fun of it.
And the public is watching the politicians closely here. A recent Gallup survey found that more than 80 percent of Americans think it is extremely or very important for Washington to agree on a plan to head off automatic budget cuts and tax increases prior to Jan. 1.
As to other proposed solutions, there are some where the differences between Republican and Democratic voters are not huge. Limits on the home mortgage deduction, for example, won 52 percent approval among Democrats and 43 percent approval among the GOP in a recent Pew Research Center survey. Forty-three percent of Democrats and 50 percent of Republicans support gradually raising the Social Security retirement age, according to Pew.
But those numbers don’t exactly represent ringing approval. And other fixes are far more controversial. The bottom line is that US voters are demanding their politicians solve a problem while remaining resistant or divided on actual solutions.
“If the deficit and related entitlements are to be addressed, it may well be in spite of public opinion, not in response to it,” concludes a Pew analysis.
What might Democrats give up in “fiscal cliff” talks? That question arises Tuesday as Republicans complain that they’ve acceded to increases in government revenue but Democrats haven’t detailed any spending cuts they’d accept.
President Obama has talked about his preference for a “balanced” solution to the crisis, with about $1.6 trillion of new revenue as part of a $3 trillion deficit-reduction package spread over 10 years. He’s been largely silent on the spending reduction side of this balance, however, and some Democrats have indicated they’ll fight if Mr. Obama tries to slash entitlement programs, as the GOP wants.
“In the past, Democrats have demanded tax hikes now for spending cuts that never happened. Not this time. A balanced approach means real cuts, now,” said Senate minority leader Mitch McConnell of Kentucky on the Senate floor Tuesday.
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Of course, to some extent GOP lawmakers have also fuzzed their proposed fiscal cliff solutions. While House Speaker John Boehner and others have talked vaguely about “new revenues,” they’ve haven’t said how those new revenues might be produced. Plus, they’ve continued to resist allowing Bush-era tax cuts to expire for the very wealthy, as Obama wants.
But Republicans say that they’ve stepped out of their comfort zone by even discussing revenue hikes, and that in return Democrats must talk about sweeping entitlement changes. What sorts of changes? Consider the provisions of a 10-year, $4.5 trillion deficit-cutting plan that Sen. Bob Corker (R) of Tennessee is currently circulating. He calls for a gradual increase in the Social Security retirement age to 68 and in the Medicare eligibility age to 67, plus a less generous mechanism for adjusting Social Security outlays due to inflation, among other things.
The GOP also wants provisions of the Affordable Care Act, aka “Obamacare,” revisited.
“It’s ridiculous to suggest that we make changes to Medicare and Medicaid, while leaving $1.6 trillion in new Obamacare spending untouched,” said Senator McConnell on Tuesday.
The White House, for its part, continues to make noises about the big entitlement programs, saying they’re on the table as part of a multipart deficit solution that also includes increased revenue.
In past fiscal negotiations with Congress, Obama has indicated he might be open to a gradual increase in the Medicare eligibility age, as well as some limits on future Social Security checks. But in recent days White House spokesman Jay Carney has said the administration believes Social Security shouldn’t be part of the current talks, since by itself it isn’t adding to the deficit. And some core Democratic constituencies, particularly liberals and unions, would fight hard to keep the age of Medicare eligibility from rising.
Unions and progressive groups met Tuesday with administration officials and reported themselves satisfied as to where the president currently stands.
“One person at the meeting ... came away convinced that the White House would ultimately prove willing to go over the fiscal cliff if necessary, rather than give ground on core demands,” writes liberal Greg Sargent Tuesday on his Plum Line blog at the Washington Post.
The left might be open to more means-testing of Medicare, however. Sen. Richard Durbin (D) of Illinois, an adamant foe of raising the age of eligibility, said Tuesday during an appearance on MSNBC’s "Morning Joe" that one solution is to have higher-income people pay more toward their government-run health plans.
As to Medicaid, the joint federal-state health program for lower-income Americans, the administration might resist large reductions. Under terms of the Affordable Care Act, Obama is trying to entice states to join in expanding the program to many more people. Big reductions in federal subsidies would not help in this effort.
One last issue that’s sure to come up is Obamacare itself – specifically, the subsidies the government will offer beginning in 2014 to help the uninsured buy health coverage.
The Obamacare bill that emerged from the Senate Finance Committee contained less generous aid than the final legislation authorized. It’s possible the two sides might agree to scale back this cost.
“I don’t see how the subsidies [for people earning] up to 400 percent of poverty could remain in this environment,” said G. William Hoagland, senior vice president at the Bipartisan Policy Center and a longtime Senate staffer, at a recent symposium sponsored by The Alliance for Health Reform.
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