The tenor of public commentary about politics in Washington suggests continuing despair about the possibility that rational lawmaking is possible in Congress. But here is a case for at least a mild infusion of optimism.
The optimism is based on the fact that President Obama has gotten a whiff of the advantages of holding firm against Republican intransigence. Liberals might not view Obama’s compromises on the fiscal cliff negotiations as a sign of firmness, but signals of Obama’s apparent willingness to plunge over the cliff were an effective ploy. It appears that he was bluffing — it is said he was extremely worried about the consequences of failing to reach agreement. But the threat worked, and for the first time in a generation some Republicans agreed to modest tax increases.
Obama followed up on the congressional vote with another threat. He said there would be no negotiations over raising the debt ceiling, an issue that Congress will have to confront in two months. He said it would be unacceptable for Congress to refuse to pay the bills it had incurred, jeopardizing the world economy in order to exact political gains. It will be Congress’ job to raise the debt ceiling. It is not a matter of debate.
Others, such as Newt Gingrich, are warning Republican leaders that debt ceiling threats will not be a useful weapon. More and more people are catching on to the destructiveness of the Republicans’ methods. But that doesn’t mean that all will be sweetness and light as the new session gets under way and Obama begins his second term.
Major budget decisions await Congress and the president, and Obama will not be able to avoid negotiating over those. Senate Minority Leader Mitch McConnell has already laid down a marker on budget negotiations, as Obama has done on the debt ceiling. McConnell said the fiscal cliff bill, which raised income taxes on those earning more than $400,000, had dealt with the issue of revenues. The question now is where to cut spending.
In other words, the Republicans are in no mood for raising additional taxes. In fact, Obama did not help his case when he said after the fiscal cliff vote that we had now taken care of our revenue problem.
In fact, the revenue problem remains. And so does the spending problem. Getting the long-term financial trends of the nation under control remains the overarching goal for both parties, though a grand bargain to achieve that goal remains elusive.
The case for optimism arises from the recognition by Republican leaders that compromise is a better option than destroying the nation’s economy. House Speaker John Boehner allowed the formation of a coalition of less than fanatical Republicans joining with Democrats to pass the fiscal cliff bill. When faced with the dangerous possibility of shutting down the government, that same coalition might be able to adopt a reasonable budget.
What is reasonable? Slowing the growth of Medicare will be key to solving the entitlement spending problem. Democrats will have to face up to that. Stimulus spending for an infrastructure bank to get the economy moving would be a constructive step. Republicans will have to face up to that. Working people have just seen their payroll taxes rise. Upper-middle-class taxpayers ought to see a similar increase by raising the income level subject to the payroll tax. Once the economy gets moving again, taxes for everyone ought to go up — taxes remain at the lowest level since the Eisenhower administration, even as Republicans complain about the deficit.
Shredding the federal budget — the discretionary spending that includes infrastructure, education, environmental protection, research, housing, foreign aid, transportation — will not yield much savings. Republicans must recognize that. Containing health care spending is the way to achieve big savings. Democrats must recognize that.
More and more people are recognizing that politics by blackmail is unworkable, which means that Republicans may be willing to take up the hard work of governance.
If optimism is warranted, that is why.
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