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The Week

(Roman Genn)



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THE BUDGET
Cliffsmanship

Faced with a scheduled tax increase that had already been written into law, and a president and Senate majority determined to keep part of that tax increase, congressional Republicans split. Almost all Senate Republicans and Speaker of the House John Boehner voted for a deal that moderated the tax increases. President Obama wanted higher statutory income-tax rates on everyone making more than $250,000; he got them only on individuals making more than $400,000 and couples making more than $450,000. He also got a phase-out of deductions for couples making more than $300,000.

Most House Republicans voted against the deal in protest of the direction of budget policy. It is certainly worth protesting: Taxes are going up, and so is the federal debt. Republicans who opposed the deal did not, however, have in common an alternative strategy to cutting it, and many of them were happy to see it pass so long as they did not have to vote for it and thus appear to endorse tax increases. Boehner appears therefore to retain the confidence of most House Republicans, which is why nobody challenged him for the speakership. A few Republicans voted against him, but their effort to unseat him fizzled for the same reason the opposition to the deal was so weak: There was no alternative.

We don’t fault either set of Republicans for their votes. The deal had to be passed, and Republicans had to make their lack of enthusiasm for it clear. We do fault both sides for other things, though. No group of Republicans called for extending the payroll-tax cuts enacted at the end of 2010. For that matter, neither did any Democrats. (The Internet has registered the shock and anger of working-class Democrats who have found that their take-home pay has dropped even though they are not among the rich their leaders keep talking about.)

There is a chance that the next fiscal battles, over next year’s budget and over the debt ceiling, will go better for conservatives. The president needs Republicans to cooperate to raise the debt ceiling. They should provide that cooperation, since there is no realistic path to eliminating the deficit in a few weeks. They should, however, pair any increase in the debt ceiling with spending cuts. Tax increases should and, we trust, will be off the table. For Republicans to support a deal that concedes that they lack the power to prevent a tax increase is one thing; to vote affirmatively for new tax increases on top of the ones that have already gone into effect would be another. Around the world, deficit-reduction efforts have been more successful the more they have relied on spending cuts rather than tax increases.

The Democrats say that it is irresponsible for the Republicans to place conditions on raising the debt ceiling because, without an increase, the government would have to default on its debts, and the threat of a default will imperil consumer confidence, credit markets, and the economy generally. They also say, some of them, that for this reason the Republicans will never go through with it. In reality, the government has substantial authority to cover its debt service even if it hits the debt limit. Congress can and should expand that authority, both to reduce the risks to the economy and to nullify a Democratic argument for letting the debt ceiling rise. With that expanded authority, hitting the debt ceiling will mean a cut in government programs but no risk of default.

Republicans should also take heed of the lessons of the government shutdowns of 1995 and 1996. During the months preceding those shutdowns Republicans had boasted that they would get their way by forcing a shutdown. When they passed budget bills too lean for President Clinton, he vetoed them. The shutdowns turned out to be very unpopular. Republicans tried to blame Clinton for them — his vetoes were their proximate causes — but their prior boasting undermined that attempt. For Republicans to talk now about welcoming a partial government shutdown would repeat this mistake. They should say instead that they are eager to avoid a shutdown and hope that the Democrats’ zeal for higher spending does not cause it.

Conservatives have more leverage in the debt-ceiling negotiations than they did in those over the automatic tax increase. They would be foolish not to use it, or to squander it by overestimating it.


Contents
January 28, 2013    |     Volume LXV, No. 1

Articles
  • Too many Republicans wanted us to take the plunge.
  • A lesson learned, unlearned, relearned, painfully.
  • Republicans should reclaim the 37th president.
  • Our mental-health system is failing those most at risk.
  • How Robert H. Bork galvanized a movement.
  • Personal attacks and cultural collapse did not reduce his joie de vivre.
Features
Books, Arts & Manners
  • Daniel Johnson reviews The Barbarous Years: The Peopling of British North America: The Conflict of Civilizations, 1600–1675, by Bernard Bailyn.
  • Elizabeth Powers reviews John Keats: A New Life, by Nicholas Roe.
  • Andrew Roberts reviews The Blood of Free Men: The Liberation of Paris, 1944, by Michael Neiberg.
  • Thomas S. Hibbs reviews The Invisible Hand in Popular Culture: Liberty vs. Authority in American Film and TV, by Paul A. Cantor.
  • Ross Douthat reviews Django Unchained.
  • Richard Brookhiser on the urban pigeon.
Sections
The Long View  .  .  .  .  .  .  .  .  
Athwart  .  .  .  .  .  .  .  .  
Poetry  .  .  .  .  .  .  .  .  
Happy Warrior  .  .  .  .  .  .  .  .