With members of Congress back in their districts until the election and the “fiscal cliff” set to take effect at the beginning of next year, Matthew Yglesias points out that the lame duck session is the last chance for a grand bargain on taxes and spending.
“If Obama’s reelected, it would be totally irrational for Republicans to refuse to agree to his partial rescission of the Bush tax cuts at a time when the alternative is full expiration. If they can get Obama to agree to spending cuts in exchange for them agreeing to something that’s going to happen anyway, that’d be a huge win for them. And yet Obama has long seemed to have an Ahab-like obsession with grand bargaineering so might well agree to such a bargain—especially because it could avert the very short-term spending cuts involved in the budget sequester. But the window of opportunity for a deal like that is very narrow. Once the Bush tax cuts expire, there’s no more bargain to be made.”