3 reasons the next round of budget talks might be easier
Tough issues remain but there have already been some key concessions from both sides
Although Matthew Yglesias says we’ve entered "an era of semi-permanent fiscal policy crisis," there’s still hope to think the next round of budget negotiations — in two months when the U.S. Treasury is unable to borrow money and automatic spending cuts kick in — just might be a little bit easier.
1. The big reason for optimism is that the issue over tax rates is settled. Republican resistance to ever raising taxes on anyone was finally broken earlier this week. Taxes were raised on the wealthiest Americans and will bring in about $620 billion in new revenues over the next decade.
2. House Republicans have already signaled to Democrats that they would consider an overhaul of the tax code — mainly by closing loopholes and limiting deductions — as a way to raise additional revenues to reduce the deficit.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
3. President Obama has already offered a major concession on how the government calculates cost of living adjustments to Social Security and other entitlement programs. By moving to a "chained CPI" calculation, analysts predict the government would save more than $100 billion over the next decade.
There are certainly many more complicated and controversial issues to be hashed out, but the seriousness of reaching an agreement in two months might also spur greater cooperation. The "fiscal cliff" was a creation by politicians, not markets, and going over it — as we did for more than a day — really didn’t amount to much. But the next deadline involves the full faith and credit of the federal government. Reneging on our debts would have an immediate punishing effect by the financial markets and possibly throw the entire global economy into crisis.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Create an account with the same email registered to your subscription to unlock access.
Taegan D. Goddard is the founder of Political Wire, one of the earliest and most influential political websites. He also runs Wonk Wire and the Political Dictionary. Goddard spent more than a decade as managing director and COO of a prominent investment firm in New York City. Previously, he was a policy adviser to a U.S. senator and governor. Goddard is also co-author of You Won — Now What? (Scribner, 1998), a political management book hailed by prominent journalists and politicians from both parties. Goddard's essays on politics and public policy have appeared in dozens of newspapers across the country, including The Washington Post, USA Today, Boston Globe, San Francisco Chronicle, Chicago Tribune, Philadelphia Inquirer, and Christian Science Monitor. Goddard earned degrees from Vassar College and Harvard University. He lives in New York with his wife and three sons.
-
Baltimore bridge disaster: Who is going to pay and how?
Today's Big Question Politicians, legal experts, and the insurance industry are all grappling with the financial fallout of America's worst infrastructure tragedy in years
By Rafi Schwartz, The Week US Published
-
Melting polar ice is messing with global timekeeping
Speed Read Ice loss caused by climate change is slowing the Earth's rotation
By Peter Weber, The Week US Published
-
The Week contest: Stick guitar
Puzzles and Quizzes
By The Week US Published
-
Trump, billions richer, is selling Bibles
Speed Read The former president is hawking a $60 "God Bless the USA Bible"
By Peter Weber, The Week US Published
-
The debate about Biden's age and mental fitness
In Depth Some critics argue Biden is too old to run again. Does the argument have merit?
By Grayson Quay Published
-
How would a second Trump presidency affect Britain?
Today's Big Question Re-election of Republican frontrunner could threaten UK security, warns former head of secret service
By Harriet Marsden, The Week UK Published
-
'Rwanda plan is less a deterrent and more a bluff'
Instant Opinion Opinion, comment and editorials of the day
By The Week UK Published
-
Henry Kissinger dies aged 100: a complicated legacy?
Talking Point Top US diplomat and Nobel Peace Prize winner remembered as both foreign policy genius and war criminal
By Harriet Marsden, The Week UK Last updated
-
Trump’s rhetoric: a shift to 'straight-up Nazi talk'
Why everyone's talking about Would-be president's sinister language is backed by an incendiary policy agenda, say commentators
By The Week UK Published
-
More covfefe: is the world ready for a second Donald Trump presidency?
Today's Big Question Republican's re-election would be a 'nightmare' scenario for Europe, Ukraine and the West
By Sorcha Bradley, The Week UK Published
-
Xi-Biden meeting: what's in it for both leaders?
Today's Big Question Two superpowers seek to stabilise relations amid global turmoil but core issues of security, trade and Taiwan remain
By Harriet Marsden, The Week UK Published