In which I get behind the Grand Bargain — well, a Grand Bargain
by digby
I love this idea from Ryan Cooper. (And I think they should definitely call it a Grand Bargain, too):
Robert Costa has an interview interview with Mitch McConnell, in which he describes his position on new tax revenues as follows:
“When the speaker has had conversations with the president over the last three years, they have always insisted on a $1 trillion tax increase — revenue scored by the Congressional Budget Office. That’s their demand for any major entitlement reform. But we don’t think we should have to pay a ransom to do what the country needs.”
Setting aside the ludicrousness of calling increased taxes a “ransom,” every single budget negotiation over the last three years has fallen apart over this point. Taxes have taken on almost totemic significance within the Republican party. They quite plainly will not agree to any rise in revenue (at least on the rich, which is what Democrats want), even if by making every millionaire pay an extra nickel they could somehow resurrect Ronald Reagan.
However, it might be possible to move past this point. The way to do it would be for Dems to ask for a different concession from Republicans, such as a huge boost in infrastructure spending to get the economy going again, and give them tax cuts in exchange for it.
Wouldn’t Republicans howl that this would increase the deficit? Maybe, but it’s also obvious that Republicans’ anti-deficit stance is 99 percent BS posturing. What’s more, the deficit really isn’t that big of a deal right now, as Ezra Klein says. In fact, the biggest problem with the deficit is it’s coming down too fast. All this austerity since 2011 has been a palpable drag on the economy, and if doubling the budget deficit would bring unemployment down a couple points, I’d make the trade in a heartbeat. What’s more, the US has a lot more fiscal running room than even three years ago — future budget projections have improved sharply, due to slowing health care cost growth.
This is exactly what we need!
I realize that a lot of Democrats have ludicrously convinced themselves that getting higher taxes will somehow “break” the GOP’s anti-tax spirit and (as with so many Democratic delusions) once we can get that done we’ll be able to enact our agenda with little resistance. Yeah. That’ll happen. (Just like Clinton’s surplus would lead to the whole country acknowledging that Democrats are the one true Fiscally Responsible party.)
Although his analysis is spot-on, I disagree a little bit with Atrios’s take on this in one small way. It’s true that they have proved over and over that they only care about deficits to the extent they can use them as a cudgel to make Democrats do their wet work for them. But it’s not that Republicans don’t care about killing Social Security and basically just want tax cuts and nothing more. I think they just want tax cuts more than anything else. I believe they truly would love to privatize Social Security. It would make money for their richie riches and destroy a program that proves government is both efficient and necessary to virtually every citizen. At this point they’re happy to do whatever it takes to make old people suffer so they can prove their point. But no, they don’t want to trade higher taxes for that.
This idea of Cooper’s is a real win-win. The last thing we need in this economic environment is more austerity. This way, the GOP gets their tax cuts, which are stimulative — and that’s good! Democrats get infrastructure which is not only stimulative and directly creates jobs, it has a lasting value — which is good! It’s all good.
I sure wish someone with a bully pulpit would get behind it.
.