Ezra Klein says that the shape of a fiscal cliff deal is clear: only a 37 percent rate on top incomes, and a rise in the Medicare eligibility age.
I’m going to cross my fingers and hope that this is just a case of creeping Broderism, that it’s a VSP fantasy about how we’re going to resolve this in a bipartisan way. Because if Obama really does make this deal, there will be hell to pay.
And here’s Klein, from the article Krugman links to:
The fiscal cliff deal comes clearer: a 37% top tax rate and a higher Medicare eligibility age
… The other [negotiating] track includes the offers, counteroffers and red lines proposed by Boehner and President Obama. If you look at these closely, a deal is taking shape.
Recall the core fight on taxes: Republicans say they’re open to more revenue, but they want to find it by closing deductions and loopholes. Democrats say that any deal needs to include more revenue, and they want to find it by letting the George W. Bush tax cuts expire for the wealthy, which would mean the top tax rate snaps back up to 39.6 percent.
But what if you do a bit of both? … Talk to smart folks in Washington, and here’s what they think will happen: The final tax deal will raise rates a bit, giving Democrats a win, but not all the way back to 39.6 percent, giving Republicans a win.
About Medicare, Klein writes:
[T]he headline Democratic concession is likely to be that the Medicare eligibility age rises from 65 to 67.
Read the rest of Klein’s article to see why Obama is attracted to this offer. It’s stunning; look for the Jonathan Chait quote.
Grand Betrayal say I, if this is the actual deal. If I were you, I’d be calling some Dems. More here, including links to phone numbers (see point 4). Time to start being part of that “hell to pay” Krugman mentioned above.
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