It's Time for Democrats to Accept Spending Cuts
Posted at noon on Nov. 28, 2012
A growing number of Republican lawmakers are expressing an openness to increasing tax rates as part of a “fiscal cliff” deal. Now it is Democrats’ turn to put spending cuts on the table, according to Sebastian Mallaby.
“Precisely because the election has buoyed Democrats, most seem unwilling to restrain health and pension costs. Given that these will swamp tax policy in the long run, this is a ruinous error… the trouble with higher taxes is that they are not enough to plug the deficit… Federal health and pension promises cost 10.4 per cent of GDP today; the CBO projects that they will cost 16.6 per cent in 2037. No plausible tax rise can offset that leap. If Mr Obama cares about his legacy, he must acknowledge this arithmetic.”