Some Wisdom Regarding The Fiscal Cliff

Marc Thiessen posted an article at the Washington Post on Monday which provided a way forward for the Republicans in the budget debate.

Mr. Thiessen states:

So what should Republicans do? Resist the call for a down payment, and insist on real tax reform as the price for any new revenue from limiting deductions. If both sides can’t agree on such reforms this year, they can do it next year. The Post reports this morning that “with tax rates set to rise automatically in January . . . Democrats say they have little incentive before then to cut a deal that falls short of their revenue goals. That means going over the cliff, at least for a short time, remains a possibility, they say.”

If Obama and the Democrats want to take us over the fiscal cliff, let them lead the way. Once the Bush tax cuts expire, every American will pay higher taxes — which means the pressure for tax reform on both sides will be even greater. By contrast, if Republicans give away the revenues from deductions and loopholes today, they will alleviate that pressure and have no revenues left to pay for a simpler, fairer, pro-growth tax code next year.

Guy Benson at has a different approach that also might work:

Short on good options, here’s one play GOP leaders might be able to make to regain some of the high ground and throw the White House back on its heels: Embrace Simpson/Bowles.  President Obama established a bipartisan debt commission with great fanfare in 2010.  Its leaders were Alan Simpson, a former Republican Senator, and Erskine Bowles, President Clinton‘s former Chief of Staff.  The panel was tasked with engineering a solution to right America’s fiscal ship.  In the end, they produced a set of recommendations that received the blessing of a majority of its members.  The commission’s blueprint drew a fair amount of criticism from conservatives, but was roundly blasted by liberals.  Liberal malcontents like Paul Krugman torched the plan with noteworthy ferocity.  The president shelved the recommendations, and they’ve been collecting dust ever since.

Bringing back Simpson/Bowles is not a great idea, but it is a good starting point for the debate.  Simpson/Bowles calls for a 3-to-1 ratio of real spending reductions to tax increases and caps federal spending as a percentage of GDP at 21 percent. This is a great place to start.

The thing to remember here is that it is not in the interest of Washington bureaucrats to cut spending at all–their power comes from growing the budget. Unless the Congress and the President are backed into a corner with no escape route, they will not cut spending. They will pledge to cut spending down the road, but it will never happen. Going over the fiscal cliff or passing Simpson/Bowles may be our best options at this time. Elections have consequences. Until we elect people who actually want to cut spending, spending will not be cut.

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