The Great Debate

Fiscal crisis? What fiscal crisis? The stock market is up, unemployment is down and the deficit is shrinking.

The fiscal crisis is in Washington, and it’s a crisis of Washington’s own devising. All those deadlines! January 1: the fiscal cliff. March 1: sequesters. March 27: a possible government shutdown. Sometime in August:  the debt ceiling, again.

The unending fiscal crisis could take up the entire year. President Barack Obama desperately wants to end it. For one thing, more spending cuts could bring on a recession. For another, an unending fiscal crisis would monopolize the agenda. No time for Congress to take up immigration reform or gun control or the minimum wage or preschool education.

What can Obama do? Here are the options:

1. The permanent campaign

Beginning in mid-February, the president tried to rally the public against the impending sequesters. He barnstormed the country, warning of the consequences and imploring voters to pressure Congress to resolve the impasse.

It didn’t work. Most voters had no idea what a sequester was. The cuts are not happening all at once, like a government shutdown. The public is also OK with across-the-board spending cuts (by a 2-to-1 margin in a recent Washington Post-ABC News poll). Just don’t cut any specific programs.

There are glimmers of light in our battle to put America’s finances in order. New hope for a long-term budget deal has come in the form of two ideas, both from outside Congress, that many of our elected officials have embraced:“No Budget, No Pay” and “No Deal, No Break.”

The critical matter now is whether these two initiatives will lead to serious negotiations, or just be rhetorical weapons in Washington’s political warfare.

Both these campaigns speak to substantive needs we have as a nation. “No Budget, No Pay” is a signature campaign of No Labels, a national coalition of Republicans, Democrats and independents advocating that Washington should focus on progress not partisanship. I am a co-founder of this group.

The Gang of Eight: (Top Row, L to R) Senator Mark Warner (D-Va.), Senator Saxby Chambliss (R-Ga.), Senator Tom Coburn (R-Okla.) Senator Kent Conrad (D-N.D.) (Second Row, L to R)) Senator Mike Johanns (R-Neb.), Senator Mike Crapo (R-Idaho), Senator Dick Durbin (D-Ill.), Senator Michael Bennet (D-Colo.)  REUTERS/File

There is growing momentum in Washington and around the country in the fight to restore fiscal sanity. So get ready for the counter-attack by the special interests and ideologues.

A growing number of Republicans have now stood up to Grover Norquist’s organization, Americans for Tax Reform, and disavowed the pledge they signed to not raise taxes. We should all commend legislators like Senator Saxby Chambliss (R-Ga.), Senator Lindsay Graham (R-S.C.) and Representative Peter King (R-N.Y.), who have recently joined in refusing to put ATR’s pledge ahead of the nation’s interests.

Republican leaders such as Grover Norquist and Senate Minority Leader Mitch McConnell (R-Ky.) continue to strike a hard line on taxes and revenues, “warning” President Barack Obama that the GOP will not negotiate or compromise when it comes to tax policy and deficit reduction.

From an electoral politics standpoint, the Democrats should “have at it.”

As the election made clear, this policy is out of step with voters. Obama made raising taxes on people making more than $250,000 a year a centerpiece of his economic message – something he emphasized in his recent press conference – and he was rewarded with a resounding victory. Voters also handed Democrats an increased Senate majority, where the tax debate played out front-and-center in many campaigns.

This theme echoed through state politics as well. Voters in California, for example, passed Governor Jerry Brown’s plan to fund K-12 public schools through a revenue increase that comes from the highest earners.