Fiscal Cliff May Have a Silver Lining

Thursday, 06 Dec 2012 03:03 PM

By Lanny Davis

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There is no doubt that there will be serious adverse consequences to ordinary Americans if, on Jan. 1, 2013, the nation goes over the “fiscal cliff” — meaning, on that day, $1.2 trillion in cuts in federal domestic and defense spending will begin over the next eight years, combined with immediate substantial tax increases and less money in paychecks for all taxpayers, especially hurting the middle class, as the Bush tax cuts are rescinded.
 
Any Democrat who thinks there is a tactical advantage to going over the cliff is probably someone who isn’t about to lose a job or remain out of a job and whose family is suffering.
 
But just for the sake of it, if this awful thing happens, is there any good that could come out of it?
 
I would say yes — three things, with the first two leading (I hope) to the most positive third result.
 
First, if this calamity happens, it will prove the hypocrisy of many congressional Republicans. The so-called conservative Republican Party of tax cuts and economic growth will have proven that it is willing to crash the economy because of its unwillingness to retain the Bush tax cuts for 98 percent of all Americans who earn less than $250,000 a year while increasing taxes slightly for the 2 percent who earn more — President Obama’s proposal that, to date, congressional Republicans have rejected.
 
But there is also some hypocrisy among congressional Democrats. Many are now insisting that Social Security reform, an important component of the Simpson-Bowles commission’s across-the-board approach, is totally off the table.

That includes opposing gradually increasing the retirement age for Social Security from 67 to 69 between 2022 and 2070. (Few seem to realize the law already requires a phase-in raising the age from 65 to 67 by 2022.) That means Democrats oppose an increase in the retirement age of a little more than two weeks per year over 48 years. Oh, come on!
 
And yet the same Democrats want to continue using credit cards to pay for worthy social programs — leaving our kids and our grandkids (and maybe great-grandkids) to pay the tab. That is just flat-out wrong. What happened to the Democratic Party (my party) of morality and justice, not only for this generation but for future generations?
 
The effect of these first two consequences of going over the cliff could lead to a third positive result in the long run: a true political revolution by the substantial majority of Americans caught in the middle between purists on the left and the right.
 
If this were a football field, then those between the 20-yard lines — neither all red, nor all blue, but somewhere in between (purple!) — could constitute — dare I use the Nixonian expression? — the new “Silent Majority.”
 
It could happen as soon as 2014, when candidates from both parties could emerge to hold incumbents accountable for their recklessness in allowing the “over the cliff” scenario to occur.
 
The two winning slogans in such party primaries could be: “Throw the bums out — all of them” and “I’m mad as hell and I’m not going to take it anymore.” (Great movie!)
 
The Democrats and President Obama are actually in the best position to take advantage and leave most of the blame for the fiscal-cliff nightmare on Republicans. President Obama’s willingness to accept the Bush tax cuts for 98 percent of Americans and raise taxes on the other 2 percent has substantial support in the country. Obama and Democrats, therefore, are well-positioned to stand up to the party’s purist base and endorse the Simpson-Bowles across-the-board approach: cost savings and reform of Social Security and Medicare.
 
If Obama does that, then he and the Democrats will have truly cemented a sustainable new left-center political majority for years to come.
 
But if neither party steps forward in this way and both parties take us over the cliff on Jan. 1, 2013, then look out! We may see the true beginning of a viable national third-party movement — well beyond what Teddy Roosevelt won in 1912 and Ross Perot achieved in 1992.
 
Stay tuned.
 
Lanny Davis is the principal in the Washington, D.C., law firm of Lanny J. Davis & Associates, which specializes in strategic crisis management. He served as President Clinton’s Special Counsel in 1996-98. Read more reports from Lanny Davis — Click Here Now.
 
 
 
 

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