Report: The Republicans’ “Doomsday Scenario”
If this report is true, the so much for all the reports indicating that after the November elections it was going to be somehow different and that the United States and poorer citizens wouldn’t find themselves pawn in a high stakes political power play. To wit:
Republicans are seriously considering a Doomsday Plan if fiscal cliff talks collapse entirely. It’s quite simple: House Republicans would allow a vote on extending the Bush middle class tax cuts (the bill passed in August by the Senate) and offer the President nothing more: no extension of the debt ceiling, nothing on unemployment, nothing on closing loopholes. Congress would recess for the holidays and the president would face a big battle early in the year over the debt ceiling.
Now what was that about the Republican Party somehow moderating a little so that the influence of hard line Tea Partiers and talk show hosts who live for polarization and confrontation would be tempered a bit?
Two senior Republican elected officials tell me this doomsday plan is becoming the most likely scenario. A top GOP House leadership aide confirms the plan is under consideration, but says Speaker Boehner has made no decision on whether to pursue it.
Under one variation of this Doomsday Plan, House Republicans would allow a vote on extending only the middle class tax cuts and Republicans, to express disapproval at the failure to extend all tax cuts, would vote “present” on the bill, allowing it to pass entirely on Democratic votes.
And then they would paint the vote as an entirely partisan measure.
This is one of several reports that bring about a sinking feeling of deja vu.
After President Barack Obama’s 2008 election there were a host of reports suggesting the United States might be head into a new post-partisan era. But then coinciding with Rush Limbaugh’s famous “I hope he fails” comment about Barack Obama GOPers began to make it clear their strategy was to be non-cooperation and non-compromise and the White House as the White House and Democrats began to try and plan to work without GOP help.
I’m getting the same feeling here. In recent weeks there have been initial reports about some Republican breaking with GOP No Taxes Godfather Grover Norquist. But in the past 24 hours there have been reports about Norquist regaining some of the perceived loss of control.
If this follows then a)we will be headed off the cliff b)some Republicans may follow the same strategy as before: by opposing and slowing down or checkmating Obama they’d make the Democrats look bad and could try and regain the upper political hand in 2014.
And it’s sad. Once upon a time in America consensus and compromise were considered ideals rather than signs of weakness. The real victims will be Americans who don’t have unemployment insurance or those impacted by the inevitable economic fall out America going off the financial cliff — not just Obama, and Democrats. But America. Which includes Republicans, too.
Meanwhile, House Speak John Boehner and the GOP have presented their plan which suggests they didn’t see the election results:
In a letter to President Barack Obama, House Republican leaders outlined the contours of a deal they said would achieve a net savings of $2.2 trillion. The plan, which is based on fiscal commission Democratic co-chairman Erskine Bowles’s proposal to the super committee, would achieve these savings through revenue from tax reforms, health savings and discretionary spending cuts.
…Dan Pfeiffer, the White House communications director, said the plan “does not meet the test of balance.”
“Their plan includes nothing new and provides no details on which deductions they would eliminate, which loopholes they will close or which Medicare savings they would achieve,” he said. “While the president is willing to compromise to get a significant, balanced deal and believes that compromise is readily available to Congress, he is not willing to compromise on the principles of fairness and balance that include asking the wealthiest to pay higher rates … Until the Republicans in Congress are willing to get serious about asking the wealthiest to pay slightly higher tax rates, we won’t be able to achieve a significant, balanced approach to reduce our deficit our nation needs.”
The counter-offer coincides with Democratic demands that Republicans produce their own proposal to match the deal offered last week by the administration. That plan, presented to Republicans by Treasury Secretary Tim Geithner, called for $1.6 trillion in new revenues, savings from entitlement programs and new spending on unemployment insurance and investment projects. GOP leaders rejected the plan out-of-hand.
Still, the GOP proposal on Monday appears to move no further toward compromise on Obama’s central demand that tax rates be allowed to increase on the wealthiest Americans. While Republicans have agreed in principle that richer Americans can shoulder a greater share of the tax burden, they insist this must be achieved through ending loopholes and deductions, rather than raising rates.
Now, House Speaker John Boehner is using Bowles’ back-of-the-envelope budget math as a counteroffer in negotiations with Obama to avoid automatic tax increases and across the board spending cuts early next year.
Boehner outlined the proposal in a Monday letter to Obama in which he said the GOP will not support any plan that increases tax rates.
The Bowles plan, which would gradually increase the Medicare eligibility age from 65-67, and implement a less generous formula for calculating cost of living adjustments in Social Security, is the most specific proposal the GOP has offered, and resembles, in many ways, the framework Obama and Boehner nearly agreed to in debt limit negotiations last summer.
Democrats were wary of that plan then, and are warier now in the wake of their victory in November.
At the Super Committee hearing last year, at a time when Republicans were unwilling to entertain the idea of raising revenue through the tax code, co-chair Rep. Jeb Hensarling (R-TX) dismissed the suggestion out of hand.
“You’ve certainly created some excitement for the press I think,” Hensarling told Bowles. “I would say don’t necessarily believe everything you read and hear about the proceedings of this committee.”
Bowles called for $800 billion in new revenue, without resorting to using “dynamic scoring,” but not specifically from raising tax rates. He proposed raising the Medicare eligibility age, and changing government tax and spending formulas to use so-called chained CPI, reducing benefits in programs like Social Security and raising tax revenues over time by hastening workers ascent into higher tax brackets as they climb the income ladder. He proposed $300 billion in further cuts to discretionary spending, $600 billion in cuts to health care programs, and $300 billion in other mandatory spending programs, but did not spell out entirely how the cuts should be designed.
The GOP’s offer provides no further specificity about those cuts either. It is silent on how to raise $800 billion in revenue, other than to call for closing loopholes and lowering marginal rates. It says nothing about when the higher taxes would kick in.
House Republicans on Monday introduced a counter-offer to President Barack Obama’s proposed solution to the so-called fiscal cliff, trumpeting that the proposal would not raise tax rates on personal income. The plan does, however, include a sizeable tax hike.
House Speaker John Boehner (R-Ohio) would allow the payroll tax cut to expire at the end of this year, an aide in his office told The Huffington Post. That would save the government an estimated $110 billion over 10 years, his office projected.
Because the payroll tax cut was already scheduled to expire at the end of this year, that $110 billion saving isn’t counted by House GOP leadership as contributing to the $800 billion in revenue that it projects will come from its fiscal cliff proposal. The Republican plan calls for capping deductions, closing loopholes, and lowering tax rates. It also may give Republicans a technical out from anti-tax advocate Grover Norquist’s pledge, which demands that signatories oppose tax hikes. Lawmakers, after all, aren’t supporting a raise in the payroll tax; they would be letting it happen as scheduled under current law.
But that logic also applies to the Bush tax cuts on personal income, which are set to expire at the end of this year. And Republicans in Congress have been loathe to see those rates rise, arguing that it would constitute a tax hike and would be irresponsible in a weak economy.
Norquist has said in the past that he would be okay with the payroll tax cut expiring, provided it is replaced with a tax cut of similar size. His office did not return a request for comment.
doomsday graphic via shutterstock.com