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Too Eager for a Fiscal Cliff Deal: Republican Leadership's $1 Trillion Tax Hike
Posted By Alison Acosta Fraser On December 17, 2012 @ 5:05 pm In Featured | Comments Disabled
The latest fiscal cliff  proposal by Speaker of the House John Boehner (R–OH) is infuriatingly frustrating to conservatives, again. In exchange for $1 trillion in tax hikes—including the President’s immediate tax rate hike on the wealthy—Boehner asked for just $1 trillion in spending cuts . And, to sweeten the pot for the President, Boehner’s proposal reportedly includes increasing the debt limit for another year. Here are just a few reasons this latest proposal is a stinker:
Grand Deal Perils to Avoid
Beyond unacceptable tax increases, there are many perils of a grand bargain. Beyond the usual budgetary shenanigans, lawmakers and the public should insist on details up front.
Lawmakers should not fall for anything short of substantive changes spelled out in any legislation they vote on. They must avoid gimmicks such as assigning savings targets to various committees for action some time down the road. Remember, that is one reason we are here today—the spectacular failure of the “super committee” spawned the “untenable” sequestration cuts in the first place, and the Senate failed to reach agreement with the House on preventing tax increases.
Past grand bargains failed to produce spending cuts , but the tax hikes still occurred, and deficits went up. The latest proposals by both sides do not seem to stray far from this model.
The nation is watching a standoff. As the clock ticks away toward the end of the year, it is clearer and clearer that Boehner’s seemingly desperate quest to solve the fiscal cliff through progressively capitulating on core conservative principles has yielded no concessions from the President and likely never will. Obama maintains he was returned to office to hike taxes on the wealthy. But Boehner and the House majority were returned to office to cut spending without raising taxes. The right things to do on the fiscal cliff  have been ruled unacceptable by the White House.
The basic choices left are to give in to the President’s demands of hiking taxes and further weakening an already weak economy, or to go over the cliff—and further weaken the economy. So the two sides should reject both of these bad choices, take a breather, and pass a simple extension of all current policy—all tax policy, all spending policy without sequestration cuts—until the end of March.
Why March? Because that is when the legislation funding the government expires, and it is near the time when the government will exhaust its capacity to circumvent the existing debt limit. This strategy means we avoid the cliff and the harm that would come from it. It also means Washington kicks the can again. But it keeps the pressure on to negotiate in good faith and to come up with a resolution, because some legislation will have to pass by the end of March to keep the government in operation.
Policymakers have intentionally and with careful forethought put us in this terrible position by creating the fiscal cliff themselves. Kicking the can a few months down the road is not a good solution. But, sadly, it is better than the only available alternatives.
Article printed from The Foundry: Conservative Policy News Blog from The Heritage Foundation: http://blog.heritage.org
URL to article: http://blog.heritage.org/2012/12/17/too-eager-for-a-fiscal-cliff-deal-republican-leaderships-1-trillion-tax-hike/
URLs in this post:
 fiscal cliff: http://www.heritage.org/issues/economy/fiscal-cliff
 just $1 trillion in spending cuts: http://www.washingtonpost.com/business/economy/boehner-offers-to-take-debt-limit-off-the-table/2012/12/16/8b369b7e-47c6-11e2-b6f0-e851e741d196_story.html?hpid=z5
 big fluffy bun: http://www.youtube.com/watch?v=Ug75diEyiA0
 government diktats like reductions in payments to health care providers: http://blog.heritage.org../../../../../2012/12/13/medicare-cuts-vs-medicare-reform/
 benefits of being bipartisan: http://www.heritage.org/research/reports/2012/11/six-bipartisan-entitlement-reforms-to-solve-the-real-fiscal-crisis-only-presidential-leadership-is-needed
 failed to produce spending cuts: http://www.heritage.org/research/reports/2012/12/the-fiscal-cliff-and-the-perils-of-grand-budget-deals
 right things to do on the fiscal cliff: http://www.heritage.org/research/reports/2012/11/fiscal-cliff-what-congress-should-do
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