GOP 'fiscal cliff' endgame: Let big government sting the middle class?

If President Obama and Congressional leaders fail to avert the “fiscal cliff” of scheduled tax increases and spending cuts by 12:01 a.m. Tuesday, America’s 114-millon-strong middle class will take it hard on the chin – a $3,500 tax blow per family, on average.

Politicians make careers out of protecting the middle class, which is why the President has focused his solution on raising taxes just for richer Americans – those making $250,000 and more – while warning Americans in his weekly Saturday address that, “Every American’s paycheck will get a lot smaller” if the fiscal cliff isn’t averted, which specifically “would hurt middle class families.”

Republican leadership, too, has been forced into a corner, in part by Obama as well as the party’s own right wing, as members have failed to come to agreement over agreeing to some tax concessions for the rich in order to stave off what amounts to a wholesale middle class tax hike.

For some intractable Republican House members, political experts say, part of the political calculation ahead of the 2014 mid-term elections is whether going off the fiscal cliff would spell political disaster or whether it may be seen more broadly as a return to what many see as principled governance.

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As Wall Street indices got jittery on Friday, it began to look like some kind of piecemeal deal that would include a tax compromise and extension of unemployment benefits could be done by the drop-dead deadline, but it could be contingent on Republicans having to come back to fight for spending cuts at a later date.

That development puts the spotlight straight back on the kind of anti-tax, anti-spend tea party principles that helped to give the GOP the House in 2010, but which also left the party deeply fractured after Obama’s reelection this November.

To be sure, there may be a deeper logic than simple obstructionism at play within the GOP caucus, where some members, the theory goes, may be seeing an opportunity to avoid direct blame for a major middle class tax hike while making a deeper point about how America should be governed. How? By letting middle-class Americans start bearing the actual cost of electing a progressive president and a Democratic Senate, neither of which has seriously addressed entitlement spending.

“How can we expect people to care about the growth of government if it doesn’t cost them anything?” writes Marc Thiessen, a fellow with the American Enterprise Institute, in a Saturday Washington Post column. “Big government is great if you don’t have to pay for it. Well, now it’s time to pay the bill. Maybe when the costs of the stimulus, Obamacare and exploding entitlements are finally deducted from their paychecks, Americans will rediscover the virtue of smaller government.”

Liberals point to a counter-logic that they contend will drive even tea party Republicans to strike a last-minute deal to avoid the fiscal cliff.

“If the deal is reached … the Republicans have won: they have locked in a federal tax system that collects so little total federal revenue that government can afford almost nothing aside from the military, interest payments, retirement programs and health care,” writes Jeffrey Sachs, author of “The Price of Civilization,” on the Huffington Post.

To be sure, the GOP’s intransigence, political experts say, is primarily rooted in a political reality where newly-redistricted voting maps have made Republican districts more deeply red, putting the party largely at the whim of gung-ho conservative primary voters, and putting anyone who sways from the “taxed enough already” tea party principles on notice for potential electoral backlash.

“For Republican members – many of whom were propelled into office by the tea party uprising of 2010 – the next two years could become a race to determine who has the sharpest rhetoric in opposition to the president’s policies,” Alex Isenstadt writes on Politico.

In that light, motivation to strike a fiscal cliff deal may be waning among tea party Republicans in the House, especially since some tea party activists have welcomed the idea of bringing back higher, Clinton era tax rates for everybody as long as they’re tied to deep spending cuts. That sanguine attitude from some in the tea party is only ratcheting up pressure on House Speaker John Boehner to quickly string together some kind of coalition to stave off a massive tax hike.

Senate action is likely to come Monday, and Boehner, in a bid for a bipartisan solution, has agreed to break with tradition and allow the entire House to immediately vote on what the Senate produces without meddling by the GOP caucus.

Meanwhile, while saying that “inaction is not an option,” Missouri Republican Senator Roy Blunt, in the GOP’s weekly address, continued to attack Obama and the Democrat-led Senate in a bid to deflect blame if the fiscal cliff is reached, sending fuming middle class voters looking for someone else to blame. 

“At a time when neither party is looking competent, Republicans appear to be inoculating themselves for taking heavy blame if no fiscal cliff deal is reached,” Bill Lambrecht writes in the St. Louis Post-Dispatch this morning.

But with so much money at stake for the middle class and so much political capital in the balance for America’s two major parties, the very principles of Constitutional government also hang in the balance as Republicans plan their next moves, writes conservative columnist George Will.

A willingness to let the Bush tax cuts expire along with imposing mandatory spending cuts could have less to do with Obama’s charge of dysfunction in the House ranks and more a push by some in the Republican party to fundamentally examine “the nature of the American regime” at a critical time in the nation’s history, he suggests.

“When the Republican House majority acts as though it has a mind – and a mandate – of its own, this is not Washington being ‘dysfunctional,’ it is the separation of powers functioning as the Founders intended,” Mr. Will noted recently. “Their system requires concurrent congressional majorities – one in the Senate, with its unique constituencies and electoral rhythms, another in the House, with its constituencies and rhythms. And at least 219 of the 234 House Republicans won in November by margins larger than Obama’s national margin.”

2012 enters the record books. Were you paying attention? A news quiz.