You are hereForums / Issues / The Economy / Republicans reject own debt-reduction deal

Republicans reject own debt-reduction deal


By John Martin - Posted on 30 June 2011

This from Ezra Klein:

By the end of the debt-ceiling negotiations, the Obama administration had agreed to a deal that would reduce the deficit by $2.4 trillion, with $2 trillion of the total coming from spending cuts and $400 billion coming from tax increases. Taxes, in other words, would be about 17 percent of the final deal. Republicans rejected it. But as little as four months ago, it was the Republican ideal.

Mike Konczal points us to “Spend Less, Owe Less, Grow the Economy,” the March 2011 report released by the Republicans on the Joint Economic Committee. The report, which tried to argue that fiscal austerity would lead to short-term growth, was as methodologically unsound, and quickly forgotten. But for our purposes, that’s irrelevant. What is relevant is the report’s golden ratio: “successful fiscal consolidations averaged 85% spending cuts and 15% revenue increases, while unsuccessful fiscal consolidations averaged 47% spending cuts and 53% revenue increases,” it concluded. There was even a graph:

So when the GOP’s economic policy team sat down to make the strongest case they could for growth-inducing deficit reduction, they recommended a mix an 85:15 mix, not a 100:0 mix. And then, when the Obama administration agreed to an 83:17 mix, the Republican leadership walked out of the room and demanded that taxes be excluded from the deal altogether. How do you negotiate with that?

Add this to the long list of Republican ideas that are then taken up by Democrats, and which are then in turn rejected by Republicans because they feel the need to distinguish themselves further from the Democrats.
I think the package offered by the Dems came to 83% spending cuts, 17% revenue increases.   It seems that being that close, surely a deal could be worked out.  Instead, the Republicans walked out.

The Republicans are not interested in negotiating tax/revenue increases and, to their considerable credit, they have given no indication in the last six months or more that they would.  They are either playing chicken to the last minute or they are  going to take the risk and force Obama to surrender or go over the cliff with them.

I don't admire their position but I admire they way they have approached it. From December 2010 through today they have been on this  "America doesn't have a revenue problem, it has a spending problem" jag.   Democrats in congress wake up every morning, a la Bill Murray in  GROUND HOG DAY, seemingly shocked to discover anew that Republicans feel this way. 

With control of two of the three branches of government, Democrats fumble every day figuring out how to approach Republicans, who have put out their very simple position and have not wavered on it for months. If you are playing poker against someone  who always keeps his cards open on the table, you  ought to be able to figure out how to win a hand or two now and then.
I don't think the Dems are going to cave on this one (it will not be 100% spending cuts, and 0% revenue increases). Dems have learned the lesson that the GOP will not compromise and call their bluff. When the voters in 2012 blame the GOP, maybe they will learn then. 
I hope you are right. I would be pretty d&Mn disappointed if the final deal, if there is one, were any worse than 85% (cuts) : 15% (new taxes/real tax break eliminations) which is pretty disappointing in and of itself.

Conservative columnist David Brooks says Republicans lack "moral decency" and are "unfit to govern" if they reject Democrats 83:17% and hold out for 100%:0% on debt ceiling debate. 

http://www.nytimes.com/2011/07/05/opinion/05brooks.html?hp

PS So called "real" conservatives have been dissing Brooks for going on two years now since he had the audacity to suggest that Sarah Palin may lack the temperment and self-discipline to be President. I guess that position, along with this one, officially makes him a socialist. :-)

What's sad about the way the Republicans are behaving is that I don't think this is a negotiating tactic-- I really think they won't accept ANY revenue increases, no matter what they're given in return.

Brooks narrows down their irrationality perfectly-- these people would rather have the U.S. default on its debt than to concede on taxes slightly, even though a default would have much more severe repercussions on the economy. Makes you wonder if these kooks love their fringe ideology more than they love their country.

 

At the fringes, people equate their fringe ideology with love of country (return to America's Founding  principles, bla bla bla).  And some number of the new Congressional republicans campaigned on a platform of absolutism (NO TAX INCREASES), and might  fear re-election backlash at home irrespective of their better judgments.

Brooks also  underscores how weak the Democrats have been, throwing 2+trillion on the table before getting anything in return ("Deal of the century" or something he called it). I emailed the White House (through Biden's page) exhorting them to give Cantor et. al. 24 hours to return to negotiations with a serious attitude toward new taxes/loophole closing or Dems will start drawing back the concessions at a rate of  1/4 trillion dollars a day. At least that way the  administration will be viewed as having an active, rather than a passive/reactive, role to play in the negotiations/message war/ (I am sure whatever summer intern picks up my email will get right on it. LOL)

I've spent several hours over the last two nights watching "The Revolution" on the History Channel.  So I say, yes, let's return to founding principles.  The newly formed government, amid much objection, levied taxes to pay off the debts incurred by our quest for independence.  The precedent has been set for taxes to pay debt...by our Founding Fathers, no less.

You obviously don't understand reality, Suzi.

No increase in taxes at any time, no matter what the situation. That is the GOP mantra, and they will stick to it, come hell or high water.

Look up inflexibility in Mirriam-Webster's. It has a picture of an elephant next to the definition.

LOL wc....I forgot all of that is off the table, no matter what.  The Founding Fathers?  They are only to be quoted when it fits their agenda.  Silly me.

Follow RFO:

TwitterCafe PressFacebook

RSS

 

 

RFO Gear

Subscribe to General RFO Newsletter

General news and announcements for republicansforobama.org. We will never share or sell your email address.