Matthew Yglesias, over at Slate, is trying to make the case that it would be better if the two sides in the US budget standoff failed to make a deal before the end of the year, forcing the US economy over the dreaded "fiscal cliff". As Yglesias points out, legislation already in place imposes tax hikes for most Americans on January 1 -- in large measure, that's what the cliff is. What President Obama and Speaker Boehner are dickering about is how much taxes should be cut from levels Congress has already mandated -- but that's surely not the way the debate is currently being framed.
It's an interesting way of looking at it, and it casts the collapse of Boehner's "Plan B" in an interesting light. If the Republicans in the House had at least rallied around their supposed leader for long enough to let Plan B come to a vote, they would have been in a better position to blame the President if and when the tax hikes take effect. However, just as Henry Kissinger once said of Yasser Arafat's PLO, the Republicans "never miss an opportunity to miss an opportunity".
Yglesias feels that come January, with the tax hikes in effect, the context of the fiscal debate will shift. It will become clearer that the debate is about cutting, and not hiking, and that may make it easier to achieve a reasonable compromise. Of course, the vexed issue of spending would still have to be dealt with, and looming not much further ahead is another round of haggling over the ludicrous debt ceiling, a feature of fiscal governance that the US shares only with Denmark. To filch from Yglesias once again, now that the GOP has weaponized the debt ceiling, US economic policy debates stand to be rancorous for years to come.
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