Democrats Should Offer to Extend the Bush Tax Cuts

In my column for The Week, I argue that Democrats can get a deal on the debt ceiling if they offer to bring back to the Bush tax cuts:

Here's one Democratic compromise that could move the debt ceiling talks further along: Extend the Bush tax cuts for four more years.

Arguably, the Bush tax rates may be the single most important deal-maker on the table.

Here's why:

Both parties, Democrats and Republicans, have agreed that now is the time to take action on the federal deficit. Personally, I don't happen to agree: I think the time to act will be when unemployment drops below 8%, or interest on federal bonds rises past 4%. But who listens to me?

Regardless, both parties agree: This is the time to shrink our ballooning deficit, as Washington tries to hammer out a deal to raise our $14 trillion debt limit, lest the federal government default on its debt in early August.

's pretty obvious how Barack Obama and the Democrats would like to resolve the problem: (1) Slow the growth of federal social programs, especially Medicare; (2) Cut defense spending; and (3) Allow the Bush tax cuts to lapse.

The convenient thing about this Democratic plan is that it does not require big changes in existing law. The president's health care reform law has already conferred on the administration many of the tools it would like to use to rein in Medicare. Defense spending will decline as the president ends combat operations in Iraq and Afghanistan. The Bush tax cuts are pre-programmed to lapse automatically at the end of 2012.

All Obama needs to do is win re-election in November 2012, and his way forward on the deficit becomes surprisingly smooth.

Republicans know that.

Click here to read the full column.