Friday, November 30, 2012
Editorial: Stop short of the fiscal cliff
The president and lawmakers in Washington need to switch from campaign to compromise mode.
From the RoundTable blog
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The election is decided, but don't think that Campaign 2012 is over. Not with Campaign 2012: The Fiscal Cliff in full swing.
President Obama has been playing host to small business owners at the White House this week and planning a campaign-style visit to Pennsylvania to rally support before meeting again with Republican congressional leaders on a budget compromise.
Without a deal, stiff tax increases and spending cuts would kick in Jan. 1. And that, many analysts warn, would throw the economy back into recession. Democrats and Republicans should be clear in recognizing that as a disastrous outcome and head for common ground.
Yet Republican lawmakers, too, have been holding small-business events and issuing talking points on Democratic plans for a job-killing, small-business tax increase: i.e., allowing Bush-era tax cuts to expire on income above $250,000 a year.
Liberal Democrats in the Senate are busily taking entitlements off the negotiating table, in odd alignment with House Republicans, who are glad to defer the discussion till next year, when they plan to double down on huge structural changes in Medicare and Medicaid contained in Rep. Paul Ryan's House-passed budget plan.
Despite voters' rebuff of the Romney-Ryan presidential ticket, GOP hard-liners are acting like this year's election changes nothing. And Senate Democrats, now with a stronger hand, risk overplaying it.
Enough. Elections do have consequences, and a compromise should include an increase in the marginal tax rate on higher incomes, as well as reforms that close loopholes and cap deductions. But Republicans are right in saying these alone will not close the gap between revenue and spending — especially on health care.
Senate Republicans sound like they're ready to make a deal on changes to Medicaid and Medicare that won't devastate the programs. Democrats must include a down payment on putting these entitlements on a sustainable path.
They're right, though, in saying Social Security should be off the table for now — it is not driving the budget deficit — as well as the Affordable Care Act, which will bend down the cost curve, if it works.
That leaves plenty to talk about to avert impending doom.
Leaders of both parties would do well to pay attention to Congress's low standing with the public. Wednesday's Lunchtime Politics poll from CNN/ORC asked respondents for their best guess on whether elected officials will behave mostly like responsible adults or mostly like spoiled children in talks to avoid the fiscal cliff. The unsurprising result: spoiled children, 67 percent; responsible adults, 28 percent.
The challenge is to prove them wrong.