The Agenda

Peter Orszag on Why Democrats Should Embrace Entitlement Reform

Peter Orszag senses that if congressional Republicans make a strategic concession on taxes, they will gain the upper hand for yet another debt limit fight come February or March:

So the question for the Democrats is: Even if you win higher marginal tax rates, how do you plan to get the debt limit increased? The Republicans, after all, could cave on raising taxes but still be unwilling to include a debt-limit increase in the agreement, absent any changes to entitlements. In that case, the fiscal-cliff victory would be Pyrrhic, with another crisis arriving in February or March.

This is exactly what I assume Rep. Tom Cole (R-OK) has in mind in calling on congressional Republicans to allow the high-income rate reductions to expire.

Reihan Salam — Reihan Salam is executive editor of National Review and a National Review Institute policy fellow.

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