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It’s Time For Some Game Theory!


I don’t find proposed “grand bargains” in which Democrats trade spending cuts for tax increases very appealing even in the abstract. But in the current partisan context, they’re transparently indefensible because they fail even on their own terms: you can’t actually make deficit reduction deals with a party that doesn’t care about deficits. Any deal will be immediately blown up by the next unified Republican government, which will inevitably pass defense increases and a massive upper-class and corporate tax cut, all almost entirely debt-funded. Unilateral fiscal responsibility is just being a massive sucker — a more generously subsidized ACA would have been more immediately popular, for example, and having it pay for itself did not actually gain any political rewards, and the deficit has now been completely blown up anyway.

Fortunately, some of our Democrats is learning:

But now that Republicans have blown up the deficit with a $1.5 trillion tax cut and other high-cost policies, many Democrats feel freed.

In recent months, Democratic lawmakers and candidates have endorsed plans allowing anyone to buy in to Medicare, to make college effectively debt-free, to replace the payday loan industry with small government banks and to provide a “job guarantee” that would spend to put people to work.

“Democrats have put ourselves at a longtime, strategic disadvantage,” said Sen. Brian Schatz (D-Hawaii), who has introduced a bill that would make most college free but has waved off questions about the cost. “We have to pay for progressive priorities, and they borrow money for theirs. After the tax cut, there’s almost no enthusiasm for worrying about how to pay for new proposals.”

More of this, please. Democrats cannot let their agenda be constrained by Republican bad faith.

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