If you’ve been party to the on-going discussion in the US about the apparent “fiscal cliff”, you’re primarily aware of two separate takes on the issue. The expiration of numerous tax cuts either signifies an unparalleled shock the still fragile economy or a return to the Clinton era’s tax policies. If you hold to the former, you probably want an uncritical extension of the tax cuts, especially for those at the top out of some misguided faith in Reaganomics. If you hold to the latter, you actually don’t want the opposite of that – of very cautious and deliberate examination of what different plans would extend – but rather total government inaction. That is, those appear to be the options the that media is primarily presenting.
Much as it pains me to say it, but this is largely on the centrist segments of the media, although there’s plenty blame to find for the conservative factions as well. Yes, Fox News has been hyping this since the election and unapologetically demanding that we renew the tax cuts especially for the most wealthy Americans in spite of all the arguments about how now is precisely the time to return to Clinton era tax rates. In short, they’re not arguing anything based on facts. It’s about protecting their faith in inegalitarian wealth distributions as somehow being more efficient, even if that’s contrary to all the evidence.
Unfortunately, the rest of the media has gotten sucked into the vortex of debating those facts. That’s why the clear narrative has been about stressing how tax policy isn’t going to drastically change, and to the extent that it does, it’s not unambiguously negative. The problem is that fiscal cliff is about more than simply tax policy. The Reid Report has excellently covered the tensions going on within the Republican Party because of this issue, but only through coverage of the tax discussion. Charles P. Pierce’s opinion piece on the issue isn’t as factually challenged as much of the Republican analysis of the issue, but it’s still myopically attached to the issue of taxes. The Republican fixation on income taxes policy to the exclusion of all other issues has been unintentionally imported into the political mainstream, and because of it, we’re only looking at half the “fiscal cliff”.
The Congressional Research Service’s report on the “fiscal cliff” isn’t even all that concerned either, as they’ve left discussion of the numerous other expiring tax credits to a final, short section. It’s honestly a horror story of how disastrously mismanaged government in the US has been over the past decades. Education is so chronically underfunded, we simply provide deductions to grade school teachers who purchase supplies for their classes. Investment in cleaner energy sources is so devalued, we simply offer a few tax holidays to wind energy production. Community renewal in the District of Columbia, American Samoa, and other chronically impoverished areas is so politically toxic that the government has simply provided small incentives to private charities and community organizers to help sort out the myriad issues facing those communities. We are suffering from a maddening lack of governance on these and other issues, and now each of those tax credits are set to expire. Even what little good has been done through willful inaction is likely to be reneged.
(The real victims of the fiscal cliff? From here.)
Yes, the argument that we must do everything possible to avoid a return to Clinton-era income taxes is silly, and largely dependent on counterfactual beliefs. But almost every major voice in discussion on this issue is refusing to talk about the rest of tax policy, in spite of their being so much to say. Inaction on the questions those additionally expiring credits raise is precisely the problem that created them as “solutions”. Now, that same cavalier attitude towards governance is legitimizing ignoring them once again.
So far, Lucia Graves seems to be the lone voice in the wilderness on any part of those other expirations.