Political writer and author John Fund tells Newsmax TV in an exclusive interview that President Barack Obama’s “single-minded agenda … to grow government” is going to drive the nation over the fiscal cliff at the end of the year.
“Republicans want to avoid tax hikes,” Fund, a columnist for the National Review, tells Newsmax. “What they’re saying is, at some point, if we get enough entitlement reform, maybe we’ll consider having a tax increase as part of that. Well, the problem with that is that Sen. Lindsey Graham wants nine entitlement spending cuts for every one dollar in tax increases. That’s not going to happen.
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“So the deal the more naïve Republicans think they can cut with the Obama administration isn’t going to happen,” Fund concluded. “President Obama seems to have a single-minded agenda, and that is to grow government. He doesn’t really want a deal that includes real spending restraint because that goes against the essence of his agenda.”
Fund also is not amused by Senate Majority Leader Harry Reid’s statements on Tuesday that Democrats are not going to offer spending cuts despite House Speaker John Boehner’s call for more specifics in the fiscal cliff talks.
“This is the same Senate Majority Leader Harry Reid who hasn’t passed a budget for three years because he hasn’t wanted his party to be accountable for actual proposals that will get us out of our fiscal mess,” Fund said. “So it doesn’t surprise me at all that Harry Reid is now saying we’re not going to negotiate by putting our own offer on the table.
“Negotiation, the old saying goes, requires two parties. In this case, we have one party that’s running from negotiating and one party that’s trying to offer something. It’s pretty obvious that Democrats — starting with President Obama and the White House all the way down to Harry Reid and the Democrats in the House — don’t want a deal. They want to go over the cliff, because that gives them a whole bunch of advantages.”
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Those benefits spring from two scenarios, Fund said.
“First, you force the Republicans into a deal where they raise taxes, they break the ‘No New Taxes’ pledge that they made to the American people through the Americans for Tax Reform group,” he said. “That way, the Republican base will be alienated. It will be demoralized even more so after Mitt Romney’s defeat in November — and you will have gotten a substantial part of the Bush tax cuts peeled away.”
Or, “if the Republicans don’t play along with that game, you go over the cliff — and what that means is you’re going to have three things happen: a flood of new revenue comes into the government because all of the Bush tax cuts are repealed.
“For example,” Fund continued, “the alternative minimum tax will apply instead to three million people, instead of 32 million people, and you can then start giving some of that back to people to the middle class in dribs and drabs — and you can play Santa Claus in January and hope that the Republicans will continue to get blamed for it.
“The second thing that will happen is that defense cuts will occur. You can manage those. Some of them you can probably walk back later in the year with a supplemental appropriation. Some of them, if you’re President Obama, you probably think are fine.
“Then they’re domestic cuts,” Fund added. “The domestic cuts can be always be brought back again with supplementals, or they can have the payments stretched out. That’s not really a big problem.
“But the way the White House will win that second strategy is with an enormous expansion of government, which is what Obama has been about for the last four years,” Fund said.
And, it appears, Fund said, that the GOP is being led down this road.
“If you move the goalposts enough, the Republicans can’t engage in unilateral surrender. So, at that point, President Obama will try to use his megaphone in the media to say: ‘Well, you know, we could have done something, but the Republicans didn’t come to an agreement, a balanced agreement and, therefore, it’s their fault,’” Fund said.
But in this case, “The White House is misreading the American people, because while they may support the president now, if it becomes clear that he doesn’t really have a real negotiation strategy, that could change,” he added. “And, ultimately, the president owns the economy — and if we go over the fiscal cliff, the short-term ramifications will be an immediate recession in the first quarter, economic slowdown. And that’s never good for a president.”
Urgent: Will Raising Taxes Help or Hurt America?
As the fiscal cliff deadline nears, however, Republicans must “demonstrate how President Obama is playing this for his own benefit, not for the country’s benefit,” Fund said.
“He won’t have the talks transparent. He won’t hold them out in the open. By not being open and transparent, he’s able to hide the fact that he’s not really offering a specific plan,” Fund said. “The Republicans can also recognize that, while in the short term they may take a hit, the longer it becomes clear that President Obama does not want to address the spending part of this federal problem because he doesn’t have a plan.
“In the long run, the people who have a plan beat the people who don’t have a plan.”
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