The Revenue Trigger

There is one, in the deal Reid appears to have now made with the White House and the GOP. Ezra puts it this way:

On Dec. 31, 2012, three weeks before the end of President Barack Obama’s current term in office, the Bush tax cuts expire. Income tax rates will return to their Clinton-era levels. That amounts to a $3.6 trillion tax increase over 10 years, three or four times the $800 billion to $1.2 trillion in revenue increases that Obama and Speaker John Boehner were kicking around. And all Democrats need to do to secure that deal is…nothing. This scenario is the inverse of the current debt-ceiling debate, in which inaction will lead to an outcome — a government default — that Democrats can’t stomach and Republicans think they can. There is only one thing that could stand in the way of Democrats passing significant new revenues on the last day of 2012: the Obama administration.

But what if Obama does not get re-elected? And what if he is forced to campaign on those looming tax hikes? I don’t really see the advantage here.

The truth is that the GOP has successfully held the debt ceiling hostage to drastic cuts in discretionary spending, without any concession on revenue. If they’ve done it once, they can do it again. Will an imminent future tax hike be enough to produce support for a balanced revenue-and spending package in the super-committee? I just cannot see the House Republicans being that adult. And given Obama’s record on revenues, why would they? Each time they have called his bluff.

But the one thing that does seem to have emerged from the clusterfuck is that defense spending has proven less sacrosanct than low taxes for the current GOP. We may finally begin to have defense cuts that are somewhat proportionate to the level of collective bankruptcy we are in. That’s my silver lining.