Democrats and Republicans on Capitol Hill blamed each other for the congressional “supercommittee”‘s failure to reach a deal on $1.2 trillion in deficit reduction. The latest National Review offers this analysis:
The Democrats claim that Republicans’ refusal to contemplate tax increases on the wealthy prevented any compromise. But the available facts contradict this claim. Republicans apparently offered to scale back tax breaks that disproportionately benefit high earners in order to get pro-growth tax reforms and spending cuts. The effect would have been a net tax increase.
Democrats refused to take yes for an answer. They wanted a larger tax increase. The Republicans say, and the Democrats do no deny, that the Democrats wanted $1 trillio in tax increases — the vast majority of the deficit reduction that the supercommittee was charged with finding. Democrats also wanted the tax increase to take the form of increased tax rates rather than just decreased tax breaks. So it did not matter that revenues would increase, or that most of the increase would come from higher payments by high earners. The top tax rate had to increase as well: the type of tax increase most likely to harm incentives to work, save, and invest, and therefore undermine long-term prospects for growth. This position makes no sense except as the stroking of an ideological totem.
