Washington is atwitter about Paul Ryan’s latest give-no-quarter budget. It is an absurd document, of course. But is it relevant? Probably not.
President Obama has indicated that he is intending to try a different deficit-reduction strategy this year. He is trying to bypass the Republican leadership and forge an alliance with the Republican Sanity Caucus–i.e. those who understand the message of the last election and are willing to marry entitlement cuts with revenue increases to create a balanced plan. That’s why he’s been shmoozing certain Republicans so assiduously these past few days.
The plan is: Do the Senate first (as opposed to experiencing the endless emptiness of John Boehner’s negotiating team). Pry off a chunk of Republicans to pass a balanced plan–and, I would imagine, if the support of some Democrats is lost because of the entitlement cuts, that’s not so bad: it makes the bipartisanship of the bill more credible.
Then go to the House. Again, pick off a sufficient number of GOP Congresspeople to forge a bipartisan majority–sort of like the coalition that passed the tax increases for the wealthy in January–and voila: there is a grand bargain, achieved without Boehner, the Tea Party or Paul Ryan.
Is this possible? Probably not. It is wise to bet on paralysis in Washington these days. But is it worth a try? Absolutely. At the very least, it will be interesting to see if those Republicans who’ve been clucking about a Simpson-Bowlesian solution really mean it.
Ah, Simpson-Bowles: there’s the rub. I think Paul Krugman–who really is beginning to resemble an Old Testament prophet–is right about the big stuff: deficits are among our tiniest worries right now. The top priority should be to get the economy moving in a more robust fashion, which means major spending on infrastructure and other long-term investments. The best argument for a budget deal, to my mind, is that it might buoy and stabilize the markets, remove uncertainty, and lead to greater private sector investment. Indeed, the best argument for entitlement reform is to make Medicare and Medicaid better, more humane (and less wasteful) systems–and to begin the process of incorporating Obamacare, Medicare, Medicaid and private insurance into a seamless system. I suspect, though, we’re not going to get to that conversation until we settle the piddling arithmetic at the heart of the current budget impasse.