NEGOTIATIONS ON the “fiscal cliff” are not going well. Republicans have accepted the theoretical need for new revenue but presented an offer that Democrats can’t afford to accept. President Obama’s team countered with a similarly unacceptable proposal to Republicans. Perhaps this is the necessary maneuvering before the real event. But there are fewer than a dozen legislative days left in the 112th Congress. As a practical matter, a deal to avert the fiscal cliff will need to be in place before Christmas. That leaves remarkably little time for the posturing to stop and the real work of finding acceptable middle ground to begin.
Rather than point fingers and assess relative degrees of intransigence, we’d like to take this moment to note the possibility that agreement can still be accomplished. Republicans are willing to support new revenue; House Speaker John Boehner (R-Ohio), in his negotiations last year with the White House, offered $800 billion. Mr. Obama is asking for $1.6 trillion with a down payment of about $1 trillion. It strikes us that there are reasonable, achievable meeting points between those two amounts. Likewise, as much as the matter of top tax rates appears to be a sticking point, the reality is that this issue, too, ought to be bridgeable. Mr. Obama has made clear that the Bush tax cuts for the wealthy must be allowed to expire, but he has refrained from asserting that the top rates in effect during the Clinton administration must be restored. Neither 39.6 percent, the top rate under President Clinton, nor 35 percent, the top rate ushered in under President George W. Bush, are engraved in stone on the commandments of their respective parties. There is a mathematical solution that involves a blend of higher rates and curtailed deductions.