The just-re-elected president had promised to slash the deficit in his first term. That didn’t happen, but there’s talk of back room deals being made right now, saith Politico:
Taxes will go up just shy of $1.2 trillion. . . . Entitlement programs, mainly Medicare, will be cut by no less than $400 billion — and perhaps a lot more, to get Republicans to swallow those tax hikes. There will be at least $1.2 trillion in spending cuts and “war savings.” And any final deal will come not by a group effort but in a private deal between two men: Obama and House Speaker John Boehner. . . .
However, the cuts all come in the far, Star Trekkie future. Nick Gillespie of Reason not unreasonably asks if Boehner is really “Dumb enough to take $400 billion in cuts a decade from now in exchange for $1.2 trillion in tax hikes that start ASAP?” Gillespie defines “dumb” in the context of history:
[T]here’s a clear pattern: Republican presidents ratchet up spending and Democratic presidents consolidate the increases. This reality is at almost complete odds with political rhetoric. . . . Perhaps the near-total disconnect between rhetoric and reality is the reason why we can’t get anywhere — taxpayers are constantly being misdirected by the powers that be.
Still, Republicans have stood for lower tax rates. Are Republicans alone in “standing by principle”? No.
There’s another: the 77-member Progressive Caucus “will not support any deal that cuts benefits for families and seniors who rely on Medicare, Medicaid and Social Security to put food on the table or cover their health costs.”
So, realistically, there is no insider constituency for reducing spending. If enough congressional Republicans vote to increase taxes, they’ll be bilked. Meanwhile, debt overhang strangles the economy, and increased taxes will also cut into the investments that make jobs.
Thus stalemate spells stagnation.
This is Common Sense. I’m Paul Jacob.