Preparing Another Surrender?

Over at TPM, Brian Beutler, reports on how the economic slowdown is reshaping Congressional thinking on the budget. He writes:

Complicating the parties’ strategy-making is the obvious X-Factor of the election. A Democratic sweep, a GOP sweep, and everything in between each portend different legislative outcomes, and so each party needs to devise multiple contingency plans. But a new, enormous unknown is making the difficult planning even trickier. For the idea that Congress will avoid the so-called fiscal cliff and replace it with some other, smaller, more considered deficit reduction package was premised on the notion that the economy would grow steadily — if not at a rapid clip — the entire year.

Fast forward to June, that no longer seems like a safe assumption. And given the nature of the fight, a weak economy will help Republicans more than Democrats to secure key policy objectives, no matter who wins in November.

….
For Republicans, the big goal is straightforward no matter how the economy fares: extend all the Bush tax cuts for as long as possible, and replace the automatic cuts — particularly the automatic cuts to defense programs — with cuts to safety net programs, federal employee pay, and other liberal priorities. The GOP-controlled House has passed legislation to accomplish the latter, and next month will vote to extend all the Bush tax cuts for one year — supposedly to buy the next Congress running room to overhaul the entire tax code.

That’d normally be a tough political sell, particularly given that Democrats are proffering a more popular alternative in which the Bush tax cuts benefiting only million-dollar a year earners are allowed to expire. But the GOP position takes on a kind of logic if you assume an extremely fragile economy in that it staves off most of the austerity headed our way next year.

“Takes on a kind of logic,” is wonk speak for, “I’m not confident I can defend this politically.” And that is the first step in surrendering on the issue of tax cuts on the wealthy.

Look, the single biggest issue… Indeed, the ONLY real issue is that is government revenue. As long as the federal government collects 15% of GDP, we’ll have deficits and we’ll also have inevitable pressure to cut social programs.

See, the Republicans are playing the long game. Starve the beast is alive and well, and in the guise of just being responsible in the face of a slowing economy, Democrats are beginning to float trial balloons about surrendering on even a small step toward rebuilding the federal revenue base. Which means that even if Obama wins in the fall, Dems are poised to lose the policy debates for the next four years.