We're Probably Not Getting A Deal

A blog about business and economics.
Dec. 4 2012 4:22 PM

We're Probably Not Getting A Deal


These New York Times headlines help illustrate that all the negotiating around the fiscal cliff doesn't yet appear to be making any progress. John Boehner's caucus isn't unified around the idea of raising $800 billion in revenue through base-broadening rate cutting tax reform. And Boehner doesn't even have a concrete proposal to raise $800 billion through base-broadening rate cutting tax reform—a goal that I think is probably mathematically impossible. Meanwhile, even as John Boehner talks about reducing tax rates the White House is insisting on raising them.

So no deal.


But as I've been saying, this all gets much easier starting in the new year. Taxes will go up, but there's no cliff-like disaster. Just a situation where Barack Obama and John Boehner agree that tax rates on 97-98 percent of Americans. Then you need a bill reducing those tax rates. Easy as pie. In addition, you'll have a situation where Boehner thinks rates on the top 2-3 percent of taxpayers are too high, while Obama insists that he won't agree to reduce the amount those people pay in taxes. It should be easy enough to come up with some kind of legislation that cuts the high-end rates a bit and makes up the difference with some deduction-capping.

Deal! It's win-win. The difference is just that when the baseline shifts from December to January, the framework changes from one in which Boehner and Obama have starkly opposed preferences to one in which they have weakly aligned preferences. In January, Obama won't agree to cut rates as much as Boehner wants but he'll agree to cut rates some. In December, there's a huge tension between Obama's desire for higher rates and Boehner's desire for lower ones.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.



Crying Rape

False rape accusations exist, and they are a serious problem.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

The Music Industry Is Ignoring Some of the Best Black Women Singing R&B

How Will You Carry Around Your Huge New iPhone? Apple Pants!

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.


The Other Huxtable Effect

Thirty years ago, The Cosby Show gave us one of TV’s great feminists.

Lifetime Didn’t Find the Steubenville Rape Case Dramatic Enough. So They Added a Little Self-Immolation.

No, New York Times, Shonda Rhimes Is Not an “Angry Black Woman” 

Brow Beat
Sept. 19 2014 1:39 PM Shonda Rhimes Is Not an “Angry Black Woman,” New York Times. Neither Are Her Characters.
Sept. 19 2014 1:11 PM An Up-Close Look at the U.S.–Mexico Border
  News & Politics
Sept. 19 2014 9:15 PM Chris Christie, Better Than Ever
Sept. 19 2014 6:35 PM Pabst Blue Ribbon is Being Sold to the Russians, Was So Over Anyway
Inside Higher Ed
Sept. 19 2014 1:34 PM Empty Seats, Fewer Donors? College football isn’t attracting the audience it used to.
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Slate Picks
Sept. 19 2014 12:00 PM What Happened at Slate This Week? The Slatest editor tells us to read well-informed skepticism, media criticism, and more.
Brow Beat
Sept. 19 2014 4:48 PM You Should Be Listening to Sbtrkt
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Medical Examiner
Sept. 19 2014 5:09 PM Did America Get Fat by Drinking Diet Soda?   A high-profile study points the finger at artificial sweeteners.
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.