Since early December I have been urging, in vain, Republican leaders to kick the can past January 1 on taxes so that everything is on the table, rather than giving Obama the tax increases he wants without a deal on spending and entitlements.

I called it the Christmas Plan, and the concept was to preserve the status quo pending further negotiations and to remove the contrived January 1 crisis:

I say call his bluff.  If a deal which tackles deficits from both revenue and spending can be reached this month, great.

If not, pass a 90 day extension of current tax rates and whatever else is needed to postpone the “cliff,” and go home for Christmas to give time for a Grand Bargain which puts Democratic sacred cows on the table.

Let Harry Reid refuse to bring it to a vote, and Obama refuse to sign it.  Their inaction will be the reason for taxes rising for everyone.

The Christmas Plan is better than a bad deal:

Sure a temporary extention of everything is not going to make anyone happy — and creates its own mess of uncertainty and complexity next year. But it is explanable to the public:

We’ve made progress, we just need a little more time to make sure we tackle the nation’s national debt and budget deficits, not just taxes.

It keeps everything on the table for negotiation. Otherwise, with the artificial deadline of December 31, Obama gets the tax rate increase he wants while allowing him to evade indefinitely the spending cuts and entitlement reforms he fears.

Joe Manchin has just introduced something along a similar concept of taking the cliff out of the fiscal cliff.  While it’s not my Christmas Plan, it stalls the effects of a tax rate increase long enough for future negotiations in which everything is on the table.

Via The Hill:

Sen. Joe Manchin (D-W.Va.) on Sunday introduced a bill he said would “soften the landing” if the nation went over the “fiscal cliff.”

Manchin said his bill, the Cliff Alleviation at the Last Minute Act, — the CALM Act — would slowly phase in the tax rate increases and allow the Office of Management and Budget (OMB) to propose substitute cuts to replace sequestration….

The bill would phase January’s tax rate increases over the course of three years. In addition, it would grant OMB “the flexibility to recommend what agencies and accounts to cut,” he said.

Manchin said that if OMB failed to do the job then the slated sequestration cuts would go into effect. Furthermore, Congress would have the “final word” on any changes to sequestration. “OMB’s decisions can be overridden by a joint resolution,” he added.

The devil, of course, is in the details, but the key thing is that the cliff ceases being a cliff, it’s more of a step down, which keeps the contrived crisis and emergency from happening while spending and entitlement reform is negotiated.

The key thing is to remove the crisis — depriving Obama of the drama he needs to get his way.

It’s not perfect, and I still prefer the Christmas Plan, but maybe it’s a viable alternative.

 
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