A basic test of fiscal credibility

A BASIC TEST OF FISCAL CREDIBILITY…. We talked early yesterday about right-wing uber-activist Grover Norquist and his claims that Republicans will, under no circumstances, allow tax increases as part of a deficit-reduction compromise. As Norquist tells it, he’s received pledges from House Speaker John Boehner (R-Ohio), Senate Minority Leader Mitch McConnell (R-Ky.), and all of the Senate Republicans involved in the Gang of Six’s search for a “grand bargain.”

The report has caused quite a stir, and for good reason. If Norquist is telling the truth — he may not be — and the revenue side of the federal ledger is simply untouchable, the prospects of a major budget compromise are dead.

But as Norquist’s remarks bounced around the political world over the last 24 hours, actual information has proven elusive. Republicans didn’t deny what he’d said, but they didn’t go to any real lengths to confirm the claims, either. Democrats took note, but made no effort to push back against GOP irresponsibility. It was as if the relevant players chose to pretend Norquist hadn’t said anything at all.

That’s fine, I suppose. Those hoping for some kind of larger deal, and especially those involved directly in talks, don’t want to see one prominent conservative bring the entire process to a screeching halt with chest-thumping boasts that may or may not be true.

But while the relevant players try to figure it out, Ezra Klein’s comments this morning ring true.

Not to steal Bill Maher’s schtick, but new rule: if you’re not willing to consider tax increases, you’re not serious about deficits. Full stop. Just as rigid pacifists aren’t credible on national defense and dogmatic Christian Scientists are rarely consulted on health-care policy, a politician who has made an ideological vow to refuse to even consider tax increases is not interested in reducing deficits — and that’s true no matter how often they say the word “deficits.”

So if Grover Norquist has really gotten ironclad assurances from both Speaker John Boehner and Senate Minority Leader Mitch McConnell that they will not permit tax increases as part of a deficit deal, then the only sensible conclusion is that Boehner and McConnell are not interested in deficits.

It’s hard to overstate how correct this is. This year’s deficit will be around $1.5 trillion. The debt is about $14 trillion. The right would have us believe that these two figures are not only horrifying, but could cause the collapse of Western civilization. Reducing the numbers isn’t just a priority, they say, but a moral imperative.

And in the next breath, those same conservatives then add, “Oh, and by the way, tackling this problem by increasing revenue from anyone at any time by any amount is unacceptable.”

That’s just crazy. Anyone who’s seriously pushing that line has no credibility on fiscal issues.

This isn’t even especially complicated. If deficit reduction is the goal, simply doing away with Bush-era tax cuts — which failed as an economic policy anyway — and returning tax rates to the levels when the economy was great would make a huge difference in bringing the budget closer to balance. To say this can’t even be part of the conversation is ridiculous.

Now, the angle to keep in mind going forward is the debate over the definition of “tax.” As we discussed yesterday, some Republicans may try to slice their promises pretty thin — they’ll keep tax rates the same, but increase revenue by tweaking eligibility, exemptions, and deductions. The amount of money paid in taxes would go up, even if the taxes themselves stayed the same.

That’s possibly what Republican leaders are thinking right now, as they talk about a compromise — they’re not raising taxes; they’re expanding the field of those paying taxes. It’s something to keep an eye on.