Top White House advisor: Hey, how about a stiff new carbon or energy tax?

Candygram from Obama economic advisor (and Reagan fed chairman) Paul Volcker, whom you’ll remember as being the only man in D.C. currently willing to talk about a VAT. His logic couldn’t be simpler: We can’t sustain The One’s levels of federal spending without new revenue, and the tried and true methods of tax hikes just won’t be enough. Enter the VAT, or some sort of “stiff” new energy tax. This is actually a de facto answer to David Brooks’s argument this morning that voters will eventually tire of ideological hardliners when gridlock in Congress gets worse and will turn to moderates who can get things done. Is that true, though, or is it more the case that the looming entitlements crisis will force hardliners to compromise when it finally hits full force? To some extent, the gridlock at the moment feels to me like lawmakers luxuriating in ideological purity while they still can, knowing that it won’t be possible before long. It’s like going to the beach to tan because you know a major storm’s in the forecast for tomorrow. The future isn’t gridlock; the future is TARP, with people like Paul Ryan and his counterparts on the left forced by emergency circumstances to take painful votes on tax hikes and major spending cuts. Everyone laughs now at Volcker’s prescription for higher taxes, but doubtless there were plenty of laughs in Greece in the last few years at the idea of an austerity budget.