Notably, smart people like Bruce Bartlett seem to think that we ought to raise taxes on other income groups as well. Never mind that we are still suffering the effects of a devastating recession. Never mind as well that we might be able to cut the deficit by, you know, cutting spending.
There appears to be a strange dynamic in the crafting and implementation of fiscal policy. It is easy for politicians to campaign on the pledge of cutting spending, but when it comes time to actually cut spending, the political class gets skittish, because it doesn’t want to offend various constituencies.
By contrast, it is very hard to campaign on the pledge of raising taxes across the board. So politicians–Democratic ones, mainly–pledge only to raise taxes on “the rich.” This is rather easy to do, the danger that the definition of the word “rich” may be rather expansive notwithstanding. But raising taxes on “the rich” will hardly be enough to cut the deficit in most times, and as the New York Times points out, it will not be close to enough to cut the deficit in the Obama era.
If we could make it easier somehow to cut spending when the time comes to actually craft and implement the cuts, while making it harder for politicians to claim that they will be able to enact responsible fiscal policies by just taxing “the rich,” we might actually do a great deal to improve our fiscal lot.
Perhaps the time has come for some sort of BRAC-style procedure to cut spending for various items. If the political class cannot directly effect spending cuts for fear of the political consequences, maybe they need to be insulated from those consequences so that spending cuts can take place, and fiscal policy can be improved.