I had this dream last night of a sane political debate. The way it started was with a congressional opposition that wanted to use the debt ceiling as leverage for spending cuts and a president who wanted to cement his legacy with an important “grand bargain.” What happened is that the president was happy to agree to substantial spending cuts, but insisted that they be paired with revenue increases. Members of Congress said they were willing to swallow tax hikes as the price to be paid for spending cuts, but they couldn’t go along with the president’s obsession with taxing the rich. Then the president said that he, personally, would be willing to make the tax increase a broad-based — even regressive — one, but there’s no way he was going to be able to sell his base on regressive tax increases plus entitlement cuts.
Then in from the darkness came the Ghost Of The 2008 Republican Party, a substantial minority of which believed that the negative externalities caused by greenhouse gas emissions were a problem and should be priced. Why not throw a little carbon tax or cap-and-trade into the mix? Then we’d be not just averting a short-term economic calamity, we’d be making progress on two important long-term problems.
It’s not going to happen, of course. But while it’s a little perverse that we’ve spent the summer of 2011 focused on the long-term budget deficit rather than the short-term jobs deficit, it’s absolutely insane that we’ve been talking about the long-term budget deficit without talking about carbon pricing as part of the solution. It would, of course, also be nice if more than zero DC reporters had noted that both the Waxman-Markey bill that passed the House last congress and the John Kerry Senate climate proposal were deficit reducers.
I'm periodically struck by the way the various insanities of the Debt Ceiling debate are nested inside each other. I start by thinking that it's crazy not to be increasing spending in the face of over 9% persistent unemployment, but Republicans fanatically oppose it for reasons that don't make sense, so I figure that the pragmatic thing to do is to crazily accept the existing level of spending. But it turns out that I have to contemplate cutting spending because Republicans are both substantively crazy enough to want massive spending cuts and tactically crazy enough to want to force them by taking the debt ceiling hostage. So I contemplate spending cuts, but then I figure that I shouldn't worry because not raising the debt ceiling would be enough of a catastrophe that the Republicans would never actually go through with it, so the Dems can safely call their bluff. But it also happens that Republicans are crazy enough to want massive cuts now, crazy enough to take the debt ceiling hostage to do it, and crazy enough to think that not raising the debt ceiling wouldn't be a big problem, so now I do have to negotiate with terrorists. "Well crap," I say, but if I'm going to negotiate with these people, I should at least get a little something. But then I discover that, even if they are offered mountains of spending cuts and the extension of the Bush Tax cuts, the R's are also crazy enough to torpedo the deal and sink the economy if it contains one red cent of tax increases.
The whole process is kafkaesque, and it becomes more so when the media continues to play its he said/she said dance and the professional deficit scolds continue to pretend that both parties are equally irresponsible. But until I read Yglesias's post this morning, I didn't realize that another side effect of all of this layered crazy is that you forget other ways in which the debate is insane. After all, global warming is distinct from the deficit in that, while both are looming problems that will be disastrous a few years down the road, AGW requires immediate action in a way that the deficit does not, and that AGW abatement also contains a solution to our revenue problems. Refusing to even discuss this is crazy, but its insanity pales in comparison to, say, Michelle Bachmann's claims that default wouldn't be a problem or Eric Cantor's "being Speaker of the House is more important than avoiding a Depression" routine, so it isn't even noticed in our present political climate.