I’ve never been part of a formal negotiation before, but from what I hear it’s usually a fairly hellish ordeal. Hilariously unreasonable — even insulting — demands are presented under the guise of “starting positions,” emotional abuse is openly used to weaken resolve, and apocalyptic outcomes are predicted as the consequence of every minor concession. At the best of times, the process lags weeks simply due to mutual intransigence; a story in the Canadian headlines at the moment involves the Alberta government’s six-month effort to negotiate a contract with a new legal team — and that bid was supposedly rigged.
All this is a long way of saying that if you’re finding the current negotiations over the American “fiscal cliff” to be scary, vicious, immature, or pointlessly stubborn — well, that’s kind of the idea.
What exactly the “fiscal cliff” even is seems to be somewhat disputed, but in the easiest-to-digest sense, it’s simply a collection of deadlines and “triggers” set to occur on the date most normal people call “New Year’s Day” of 2013.
Most notably, January first heralds the formal expiration of the so-called “Bush tax cuts” (which “temporary” lowered rates for Americans of all brackets way back in 2001, but have been repeatedly renewed since) and initiates the mean-spirited, all-program spending cuts introduced in that “sequestration” deal both parties cobbled together in 2011 in an effort to scare themselves into being more productive in 2012 (and how well it worked!).
Added on top of those two biggies are some other expiration dates for a bunch of more minor tax credits and benefit programs, most of which are either related to the stimulus initiatives of the early Obama term, or are simply routine pieces of budget management legislation that are ordinarily renewed every year without controversy.
Anyway, economists have long argued that the threats posed by all these various things expiring and triggering at once would be severe, even from a pro-austerity perspective. Tax hikes and spending cuts may be reasonable deficit-and-debt fighting tools in theory, but like so much else in life, there are right and wrong ways to wield them in practice. The general consensus is that across-the-board tax hikes at the present moment would badly reduce consumer spending while simultaneously hiking unemployment, while vicious program cuts would similarly yield a harsh blow for all workers and industries dependant on government commerce — particularly the defense industry.
Now, for the last year, the conventional wisdom was that the threat posed by all this stuff happening at once would be so severe it would force the creation of some sort of bipartisan Congress-White House alterna-deal to avert it, and, as predicted, that’s exactly what’s happening now — sort of. Both the GOP-led House of Representatives and the Obama administration are indeed talking deals at present — the only problem is they’re mostly talking past each other.
President Obama’s fiscal cliff alternative, as he touted endlessly during the last election, is for the wealthiest Americans to “pay a little more” while simultaneously approving the renewal of the Bush tax cuts for everyone else, and implementing some vaguely-defined but supposedly “smarter” spending cuts rather than the draconian sequestration ones.
The Republicans, led by Speaker John Boehner, on the other hand, want a far more spending-centric approach, with the Bush tax cuts preserved for everyone, even the richies, and the revenue problem addressed through some equally vague changes to the tax code that would close loopholes and limit write-offs.
Both negotiation positions are thus a fairly predictable mix of stubbornness on matters of ideological principle coupled with a much more indifferent attitude towards actions philosophically unpopular with the two parties’ respective bases. Topped off, of course, with a great deal of hypocritical bluster that the “other side” is being maddeningly dogmatic.
The GOP has repeatedly asked, to no avail, to see the White House’s “ideas” for spending cuts, while the Dems have pressed in equal vain for greater Republican specifics on revenue. “No substantive progress has been made” said Speaker Boehner the other day.
With only a month to go before D-Day, it all seems rather depressing. That is, unless you read nonpartisan inside-the-beltway gossip sites like Politico, which insist the public war of words is really just so much Kabuki, and the two sides are actually vastly closer to a deal than their Sunday morning talking points claim.
In a recent piece rife with anonymous sources, Jim Vandehei and Mike Allen claim that shortly before Christmas, what’s almost certainly going to hashed out is some sort of compromise whereby Republicans agree to a tax hike on the wealthy (there’s “no chance taxes are not going up for people making north of $250,000″ they say) on the condition that the hike is balanced by a numerically equal cut in spending. The latter, in turn, appears most likely to take the shape of “entitlement reform,” which is to say, cuts to Medicare “through a combination of means-testing, raising the retirement age and other ‘efficiencies’ to be named later.”
It is a supremely logical, adult solution, but of course politics is not very adult or logical these days, and part of the reason things are dragging on as long as they are is simply to slap some veneer of partisan credibility on a deal that’s would otherwise be (shudder) too bipartisan for either side.
Speaker Boehner, for his part, has to do some delicate salesmanship to his own caucus in order to win over the so-called “majority of the majority” in the House of Representatives, including more than a few Tea Partiers and Norquistites for whom any sort of tax raise will be a poison pill. President Obama’s game is obviously a bit easier, since he enjoys a more uncontested position as party boss, but he could easily lose that status in short order if Democrats in Congress are made to swallow a deal that seems too GOP-friendly — a la the widely unpopular debt-ceiling deal of last August.
There’s thus something more than a little darkly hilarious about a deal-making process that’s being protracted largely because two reasonable players are trying so hard to appear unreasonable.
But that, I suppose, is all part of the filthy art of negotiation.