Congressional Republicans seem to be tying themselves up in knots in their negotiations with Barack Obama and the Congressional Democrats regarding ways to avoid the so-called ‘fiscal cliff.’ The fiscal cliff is of course the dramatic drop in economic and job growth that is supposedly going to occur if the country faces a combination of tax rate increases and government spending cuts. Whether anyone believes the fiscal cliff will actually occur is a moot point. What the Republicans should do at this point is give Obama and the Democrats everything they want in any fiscal cliff deal.
That is right – the Republicans should simply lie down and surrender the fight. Why? The reason is very simple - it is a fight that they cannot win. If they negotiate a deal with the Democrats and the economy goes into the tank anyway, then the Democrats and their accomplices in the so-called mainstream media will blame the problems on the parts of the deal for which the Republicans advocated. For example, if Republicans agreed to no spending cuts in exchange for no tax increases, then the continuing trillion-dollar deficits and accompanying sluggish economic growth would be blamed on Republicans for not allowing enough additional revenue to bring down the deficit.
So the Republicans instead should let Obama and the Democrats pass whatever plans they want to avert the fiscal cliff with only one stipulation in the deal – that Obama and the Democrats must accept 100% responsibility for whatever the results are. There could be no more blaming Bush, blaming ATMs, blaming airport kiosks, blaming the weather, blaming the Arab Spring, etc. And since the Republicans will have effectively washed their hands of the deal, the so-called mainstream media could not blame them for the results either.
Instead what the Republicans are doing now seems to be very close to asking for exactly what is supposed to cause the fiscal cliff in the first place. They seem to be leaning toward a deal that will cause taxes to be raised on the top 2% of taxpayers or maybe more if they get a deal that limits deductions for all taxpayers while also asking for major spending cuts in exchange for the revenue increases. Increased taxes and spending cuts are the exact ingredients which will cause the fiscal cliff, and those are what the Republicans are advocating. This is political suicide if there was ever a case of it!
Obama and the Democrats have stated what they want is higher taxes on the wealthiest Americans (by their definition), no reforms to Social Security or Medicare, no spending cuts except maybe in defense and no changes to Obamacare. So let them have it – all of it.
After all, anyone with a brain knows that the stated reasons of what will cause this so-called fiscal cliff are bogus anyway. Allowing tax rates to go back to the levels they were 12 years ago, when times were pretty good, is going to cause a fiscal cliff? Most people remember the 1990s as a pretty good time for economic growth. It is true that much of that growth was driven by the tech boom, and clearly Bill Gates was more responsible for the economy of the 90s than Bill Clinton ever was. But there was no lack of investment, spending and risk-taking taking place in the 90s with those tax rates.
And the ‘massive’ spending cuts that are the other ingredient in the fiscal cliff soup are a grand total of $1.2 trillion to be spread over a 9-year period. That is $133 billion per year out of a budget which is currently over $3.6 trillion. That is less than a 4% spending cut. And even then spending levels would be much higher than they were back in 2006, again when unemployment was low, economic growth was solid and the economy was generally doing pretty well – aided this time by the housing boom, of course.
The real fiscal cliff is looming but it has nothing to do with tax rates or spending levels. Instead it has everything to do with Obamacare. So regardless of what victories the Republicans can win in negotiations with Obama and the Democrats, the economy is still basically doomed because Obamacare is still looming as the biggest job destroying and tax increasing legislation ever passed by the federal government. Companies are already scaling back and shedding jobs because of Obamacare, and it has not even been fully implemented into law yet.
So for all those dejected Republicans who are wondering how they can ever win on a national level again the answer is simple – do nothing, literally. Let the next two years belong to Obama and the Democrats. Make a big deal about it even. John Boehner and Mitch McConnell should have a joint news conference in which they state that they have decided to accept the will of the American people and allow Obama and the Democrats to pass any fiscal cliff plans that they choose. And then they can just sit back and continually state that they have no responsibility for any carnage that occurs as a result of those plans.
Right now the Republicans are in a no-win situation. If they participate they will get full blame for the economy when it tanks. And if by some alternate world of economics the economy actually improves despite Obamacare and continuing massive deficits then they will get no credit for it. By removing themselves from the process, they then move to a no-lose situation. If the economy improves, they still win because they can say that they allowed the Democrats’ plans to pass and if the economy tanks then they can say that they had nothing to do with it.
But the most likely scenario is that the Democrats’ massive deficits and Obamacare provisions will continue to weigh down the economy and job growth. Within two years the results may already start becoming evident which will allow the Republicans to make gains in the congressional elections of 2014. And by 2016, they should be well poised to retake the presidency as long as they put forward a viable candidate.
Of course, this hands-off approach is not likely to occur. First, the Republicans are too proud to take themselves out of the game. And it would take great commitment to do nothing knowing the damage it will inflict on their country and their fellow Americans. But just like the homeowner with the bad yard, sometimes he has to just burn it up and replant new seeds to make it healthy and full again.
Plus, it is not likely that the Obama and the Democrats will allow the Republicans to institute their hands-off approach. Deep down the Democrats know that their plans do not work. As Obama likes to say, “They have never worked.” Massive government spending, massive government entitlements and massive tax hikes have never worked in any country that has tried them (see Greece, for example). The Democrats will not be willing to accept responsibility for the results of their plans. Obama has never done that and he still will not do it even though he is no longer running for re-election and he will have already achieved his goal of weakening the United States. While he will be revered among his friends like Bill Ayers and Valerie Jarrett, he still wants a legacy. And his will be a legacy of failure unless he has someone else to blame for his failures.
So in the end there will likely be some sort of watered down fiscal cliff deal, or no deal at all but just another ‘bridge’ to kick the proverbial can farther down the road. The Republicans' pride and love of country will keep them from allowing the nation’s yard to be burned before being replanted. And Obama and the Democrats will never accept sole responsibility for the fate of the nation when they can use the so-called mainstream media to their advantage in continuing to blame all our nation’s ills on the Republicans.
But if the Republicans really want to play it smart and make a political calculation like the Democrats are so good at doing, they will pull their punches, take a dive, declare the Democrats the victors and then sit back and watch the results from the sidelines. Doing anything else would be to commit the ultimate act of political suicide.
UPDATE (12/04/12): This article should have stated that the Republicans should give Obama and the Democrats everything that they proposed prior to the November elections. For Obama that would mean giving him his so-called 'balanced approach' plan of restoring tax rates on high-income earners coupled with some reductions in spending, or at least some reductions in the rate of growth in spending. By no means should the Republicans agree to Obama's new proposal to increase taxes by $1.6 trillion and actually increase (not decrease or even hold steady) future levels of government spending. The Republicans should simply state that they are willing to give Obama and the Democrats whatever they proposed during the campaign, and apparently what the American people wanted, but nothing more than that and nothing less. And again, in exchange for doing that, they should then lay full responsibility for the results of those proposals at the feet of Obama and the Democrats.