The good news is Congress stepped back from the cliff and it didn’t make a grand bargain behind closed doors and pass it without public review.
But the day late, many dollars short fiscal cliff deal that passed the House last night is anything but inspiring. Instead of resolving a self-inflicted budget wound, Congress and the President went bungee jumping off the cliff and are going to be in the same position in a couple months. That’s when the machinations to avoid the debt ceiling will be exhausted and the delayed sequestration rears its ugly head.
The package did raise new revenues, which is good, and it installed a more realistic tax baseline. But that baseline would perpetuate massive deficits, and it also complicated the code by adding in new brackets. It eliminated the need for an Alternative Minimum Tax patch each year by making it permanent and indexing for inflation, but it didn’t permanently fix the Medicare Doctor Payment issue. Congress did refrain from including a five-year farm bill, going with a one year extension instead. But it added a whole passel of tax extenders dealing with everything from NASCAR tracks to rum taxes that didn’t belong in the bill and go the opposite direction of tax reform.
It’s pretty clear that Congress can’t do grand bargains. A series of policymakers have routinely gone behind closed doors to hammer out a deal and come out empty handed. Instead, lawmakers should tackle spending, entitlement reform, and tax reform separately through regular order. The public needs to see what Congress says it wants to pay for, what we can’t afford, and what we need. It seems that each time they shoot for the moon, they end up shooting themselves in the foot.
Pathetic. But at least by tomorrow, we can say good riddance 112th Congress, don’t let the door hit you on the way out.