The left was convinced Compassionate Conservatism was simply a case of another Republican president saying "nice doggie" until he could find a rock. So they spent much of the first term screaming about Bush's heartless policies, even as he was increasing spending almost across the board. Now, he's heading toward lame duck territory and his most exciting reforms on social security and taxes are moldering.
But that was the case before the new spirit of compromise!
In my ideal world, I'd never agree to a hike in taxes. But the simple fact is that a huge chunk of the public thinks it's the job of the rich to pay more than their share for government they don't use. I'd much prefer a flat tax or, even better, a consumption tax, which would tax everybody at the same rate and not punish people for working harder (aka making more money). For those who think this is outrageous, consider the fact that nobody ever called church tithing immoral, even though everybody's expected to pay the same percentage. But we shouldn't make the perfect the enemy of the good.
So even though this country's fiscal problems have to do with overspending, not undertaxing, the fact remains that major, serious spending cuts are probably politically impossible without some tax increases. What I propose - for conversational purposes in this new age of bipartisanship - is that for every 2 percent cut in spending we increase taxes by 1 percent on the top 1 percent. I know there are all sorts of economic arguments against this, but the political argument is the one that concerns me.
The moralizing watchword since the war on terror began has been "sacrifice." Americans need to share more of it. Cutting spending alone would inevitably fall on the backs of the poor because they rely on entitlements more, and you can't seriously cut spending without cutting entitlements. In effect, my hope is that the tax dollars of the wealthy would buy the cuts for the poor.
I'm sure I will hear plenty of screams from both sides about this. But do keep in mind that in my own Memorandum of Understanding, this deal must work both ways. For every 2 percent increase in spending, the top 1 percent get a one point tax cut. The idea is to make government growth not just fiscally but politically expensive. And the way things are going now, the rich would end up living tax-free under my plan.
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