Some are wondering why I appeared to change my
tune from urging
no deal on Monday to a very, very grudging but clear acceptance
of the deal on Tuesday.
First, when I wrote on Monday, the Senate hadn’t acted yet, and
certainly not with an 80-vote majority. The political calculations,
and the cost of inaction by the House, shifted once the Senate
acted.
But that’s the least important reason. The second lies in the
Senate deal actually meeting (or almost entirely meeting) my
specifications on Monday:
Any deal that delays the spending cuts under sequestration
(without replacing them with other cuts) should be
anathema. If this deal re-raises spending (on anything other than
defense), it should be an absolute non-starter.
Now, if it delays sequestration, but replaces it with other,
specified spending cuts instead of an across-the-board bludgeon,
then that is actually BETTER policy than sequestration.
Well, the end result was indeed that the
sequestration cuts were replaced with other cuts. Or at least they
were offset with an equal amount of “savings.” Now, it is true that
small portion of the offset comes from a change in Roth IRA
accounting rather than from spending cuts. And it is true that the
cuts aren’t “specified” as I had hoped. But the
offsets do come in the form of law — in budget
“caps” going forward that, while hardly foolproof, do actually
provide several important hurdles in the way of those who would
exceed them. Moreover, by keeping intact under law the exact same
budget targets as under the original sequestration deal, and by
keeping 5/6ths of those savings in the form of the very
hard-to-evade bludgeon of sequestration (if Congress doesn’t act,
sequestration is automatic; the GOP need not do any more bargaining
to achieve those savings), fiscal conservatives are
no worse off than they were a week ago. Tactically,
in fact, they are better off, because they preserved sequestration,
but without the threat of higher taxes that will kick
in for everybody and automatically, if
they don’t act.
There are several other techical and tactical considerations,
but space and time don’t allow a full exploration of them
— except, except, except!
— for the great victory conservatives achieved
on taxes that was beyond anything I think anybody hoped for. That
victory comes in the form of keeping the full $5 million exemption
against death taxes ($10 million for couples!), plus
the additonal benefits, never anticipated, of being permanent and
being permanently indexed for inflation. The second victory
comes in the permanent, indexed-for-inflation fix for
the Alternative Minimum Tax.
Considering that the right was facing a possible hike
on all taxes being blamed on us, and that the
alternative was a hike on all income about
$250,000 without any conservative gains on the AMT
and the death tax (and possibly a big loss on the latter), the end
result was far, far better than had seemed possible after seven
weeks of misplaying the conservative hand. Indeed, on tax policy,
we nearly achieved a draw. On spending, we achieved at least a draw
(with the added benefit of buying time to save defense). And in
terms of politics, conservatives bought themselves two months to
regroup and improve tactics, strategy, communications, and
mood.
For all those reasons, the “over-the-cliff” advice I offered
turned into the “cough-cough, splutter-splutter, well, okay, it’s
not awful” conclusion I reached a day later. Both the policy and
the politics of the situation argued slightly more in favor of the
deal than before. On such a close call, considering the political
reality that applied, I don’t see how anybody could be really angry
at anybody who voted either way on the deal. If David
Vitter, Jeff Sessions, Pat Toomey, Tom Coburn, and Ron Johnson(aong
other solid fiscal conservatives) thought it was on ever-so-slight
balance better to pass it than to defeat it, it’s just not fair to
accuse those who voted for it of being “squishes” or “spineless”or
“RINOs” or any other such epithet. This was no abandonment of
principle; at worst, it was an improper weighing of conflicting
pluses and minuses in terms of both principle and politics.
Now is the time to stop cannibalizing ourselves, and instead to
move on and take the political advantages that are afforded by the
next two budget-related battles. More on those advantages
later…..
