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View Diary: Daily Kos Elections New Year's Open Thread (220 comments)

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  •  I suspect in the end it'll work out like this deal (5+ / 0-)

    Let's face it: we've now had four rounds of this kind of fiscal battle: December 2010, March 2011, July 2011, and now December 2012. Each time you get frantic rounds of negotiating and teeth-gnashing, Republicans screaming about spending cuts, Democrats freaking out about entitlement cuts... and in the end, you end up getting least-common denominator deals that just punt most of the bigger questions till later.

    It's a terrible way of governing, but there is logic to it. We have highly polarized parties, a political system with a huge number of veto points, which means that the default state of action (with divided government) is gridlock. But gridlock doesn't mean that the government doesn't still have to fund things. And so you get these punctuated crises, and with each side trying to win a decisive battle, it never seems to happen. Instead, each crisis ends with a deal that everyone hates, but which actually addresses almost none of the bigger issues, and then punts on everything else.

    I'm annoyed by the deal as much as anybody, but I suspect the next round - which is going to start up almost immediately - is going to end up with something like a 1-year lifting of the debt ceiling, a partial offsetting of the sequester, and some small revenue increases (through closing deductions) in the neighborhood of $200-300 bil., and some similarly-sized cuts to Medicare providers. Then we'll go through another debt-ceiling/government shutdown debate in 2014 with similar results.

    •  Pressed "ok" to quickly... (7+ / 0-)

      ... but just to conclude things (though this may be redundant), it essentially means that we're locked into a cycle of tit-for-tat, last-minute, least-common denominator deals. It won't make anyone happy, and it's hugely suboptimal. But it's arguably better than nothing. In the end, we've actually gotten fairly little austerity at the federal level (in contrast to Europe) because of constant punts on cuts and stimulus tax policies expiring. We'll slowly see the deficit whittled down. And military spending will fall.

      The flip side is we won't see real -- and necessary -- revenue increases for quite some time. What the experience basically shows is that contrary to the myth of the Grand Bargain, the only way you're going to get a balanced, "centrist" entitlement-reform and revenue-raising tax reform bill is going to be when Democrats again hold the trifecta. Both the 1993 Budget Reconciliation Act and the ACA are the relevant precedents.

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