One of the left’s favorite parlor games to play on Republicans is to ask them, hypothetically, if they would accept $1 in tax hikes for something like $9 or $10 in spending cuts. The game is designed to show that Republicans have some kind of unreasonable opposition to higher taxes. Republicans, however, realize it’s a trick. The tax hikes are always real, while the promised spending cuts never materialize. This year, however, the slow-moving train wreck dubbed the “fiscal cliff” offers an even worse bargain. Unless a deal is struck, the “fiscal cliff” will deliver $4.75 in tax hikes for a measly $1 in spending cuts.
The “fiscal cliff” is simply the confluence of the expiration of several tax measures and mandatory spending cuts put in place during last year’s negotiations on the debt ceiling. The across-the-board spending cuts, i.e. sequestration, take effect if Obama and Congress fail to identify specific spending reductions. The media uses scary words like “draconian” and “severe” to describe the cuts, but in reality they are a paltry $109 billion a year. That’s just around 3% of this fiscal year’s spending. Even with this cut, federal spending will still increase next year by around $16 billion.