Boehner's "fiscal cliff" progress report: No progress

If, like Krauthammer, you think Obama’s fiscal-cliff stance is more about driving a wedge in the House GOP caucus than in deficit reduction, then yeah, of course there’s no progress.

But maybe there’s “progress” to come?

House Republican leadership staffers have privately discussed — but mostly dismissed — the idea of passing two tax bills: one to extend all rates, even for families making above $250,000 annually; and a second to extend just middle-class income rates, along with a patch to the Medicare reimbursement rate and alternative minimum tax. Both would pass the House, the thinking goes, but only the Democrat-favored one helping the bottom 98 percent of earners would make it through the Senate…

Republican aides see the dual-tax bill proposal as a loser for GOP lawmakers committed to extending all the Bush tax rates, which are set to expire at year’s end. Pursuing the plan — absent major concessions from Obama on entitlement reform — would be akin to waving a white flag on the central issue of the lame-duck session, they argue.

“We’ve had two years of failed mechanisms and cliff-like dates. We don’t need another effort to kick the can down the road without accomplishing even the slightest of entitlement reforms,” one GOP aide said. “If folks aren’t willing to do the hard work now — immediately after an election and farthest from the next election — then we’ve got no hope of ever resolving this constant uncertainty. Frankly, we’re better confronting the cliff and going over than contemplating this proposal.”

Besides, Republicans say it’s far too early to even consider such a move. It’s a discussion for Dec. 26, not Dec. 6, one aide said.

Supposedly it’s just staffers who are talking about the two-bill fig leaf, not Boehner, Cantor, et al., but with Tom Cole having already called for compromising on tax hikes for the rich, somehow I think leadership’s aware of the idea. I do think Cole’s right that if they’re going to do this, they’re better off doing it sooner rather than later. If they’re so terrified of going over the cliff that they’d resort to the two-bill maneuver on December 26, Obama will capitalize on their panic and scale back any concessions. If they endorse the idea now, though, then they’d detonate his talking point about Republican obstructionism and could spend the next three weeks pressuring him to show the same sort of seriousness and bipartisanship on deficit reduction that they showed by reluctantly agreeing to his tax hikes. A senior Republican aide told Byron York yesterday, “There’s a growing sense that it is hard to imagine a scenario in which the top rates don’t go up somehow.” If that’s the case, where you’re staring at a fait accompli, then why not go the Coulter route and deprive Obama of his big party-of-the-rich talking point? He’s the one who’s fundamentally unserious about deficits, not the GOP; let’s spend three weeks talking about that instead of what the top bracket should be. (Tellingly, Boehner didn’t rule out tax hikes on the rich today.)

But then, all of this depends on the assumption that Obama has less to lose from going over the cliff than the GOP does. See Erick Erickson for an argument to the contrary. If you believe the polling, Republicans will get most of the blame if we reach January 1 with no deal. But Erickson’s right that midterm elections tend to be referendums on the White House. If rates go up across the board and we slip back into a recession because Obama and Boehner are deadlocked, will House Republicans be blamed for that two years from now or will The One be blamed? That’s question one. Question two is, if you go the Cole/Coulter route and publicly offer to raise taxes on the rich in exchange for serious cuts and then we end up in a stalemate because Obama refuses, will that affect the calculus on whom the public ultimately holds responsible?