Speaking of the GOP’s governing problems, you’d think a federal government completely dominated by the same political party — Republican House, Republican Senate, Republican White House — would be able to get together and pass a federal budget.
They have tried sweet-talk and dire warnings, insults and bluffing tactics. None of it has worked, which is why a growing number of Republicans are beginning to despair about agreeing on a budget plan for next year.
Embarrassing as that would be for the party that controls both houses of Congress, many Republicans are concluding they would be better off with no budget plan than with one that would require them to pay the cost of permanently extending last year’s tax cuts.
Senate Republican leaders, back from their Memorial Day recess, showed little sign on Wednesday of persuading a small band of rebels within their own party to drop their insistence on “pay as you go” rules.
The four Republican dissenters, joined by most Democrats, are demanding rules that would force Congress to pay the cost of any new tax cuts either with spending cuts or tax increases in other areas.
Those riskily radicals who are looking for some semblance of fiscal discipline; how’d they even get elected?
It probably didn’t help budget negotiators that the Center on Budget and Policy Priorities, the most reliable and credible budget experts in DC, released a report yesterday morning showing that making Bush’s tax cuts permanent — the main sticking point that is ultimately holding the budget process up — would be a fiscal disaster.
Popular discussions about the advisability of recent tax cuts have frequently ignored a simple truism: someone, somewhere, at some time will have to pay for them. The payment may be in the form of increases in other taxes, reductions in government programs, or some combination of the two; the payment may occur now or later; it may be transparent or hidden. But iron laws of arithmetic and fiscal solvency tell us that the payment has to occur.
Some tax-cut advocates try to deny the fundamental fact that the tax cuts will need to be paid for. For example, some claim the cuts will generate enough economic growth to “pay for themselves.” As discussed below, the evidence not only does not support such claims, it implies precisely the opposite result — that sustained deficit financing of tax cuts will end up reducing long-term economic growth, thereby raising the cost of the tax cuts. Others claim the repayment can be postponed indefinitely. But given the nation’s large underlying long-term fiscal imbalance even without the tax cuts, such indefinite postponement of paying for the tax cuts is simply not possible — it eventually would spark a serious fiscal crisis.
The handful of Republican hold-outs, including Sens. McCain, Snowe, Collins, Chafee, are no doubt aware of the consequences the CBPP pointed out. Fortunately, for all of our sake, they’re not budging.
But from a purely political perspective, the idea that the GOP can’t get its act together is terribly amusing.
[T]he biggest issue for Republicans may simply be the embarrassment of not being able to pass a basic budget plan even though they control both chambers of Congress and the White House.
“It’s optics,” said one Republican aide. “The issue is, can the Republicans do the most basic of things, which is to pass a budget?”
I think the answer to that one is pretty obvious.