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August 3rd, 2011 12:23 pm
Play Small Ball, or Swing for Fences?

One of the biggest decisions that conservative members of the new congressional debt commission will need to face (and this assumes that all six GOPers are conservative; if not, Mitch McConnell and John Boehner should crawl under rocks forever) is whether to try to swing for the fences with a “grand plan” or whether to try to reach the required savings numbers (all of which are subject to the fallacy of misplaced concreteness, but that’s a story for another day) via policy changes that will be as invisible and thus as little frightening as possible.

From a policy standpoint, what’s needed is both approaches at once — i.e., a “super grand plan” that achieves far more savings even than those required under this week’s deal. That’s how big the long-term problem is.

But for now the super grand plan is pie in the sky. The choice is between merely grand, on the one hand, and small ball on the other.

From a political standpoint, the advantage of a grand plan is that it requires buy-in from the moderate Dems and thus takes away the left’s ability to demagogue it. The disadvantage is it lets the leaning lefties look reasonable and, if Obama signs off, reinforces the (false) image he wants to portray as a moderate. It also would probably require some policy compromises that mean the end result won’t actually work as well as conservatives might otherwise hope.

The advantages of small ball are that it avoids a huge fight, thus potentially locking in whatever advantages the right seems to have now over Obama, and it leaves to conservatives — if they sweep the 2012 elections — the ability to implement REALLY good policy reforms in 2013. Disadvantages? It continues to allow the left to lie about what the GOP plans are, and thus to demagogue those purported plans.

What do I mean by “small ball?” Formula changes. Things like a “chained CPI,” or inflation adjustor, that saves money over time — except that the design of the “chain” would be ratcheted up, in terms of savings, from what the Gang of Six proposed. A quick and easy solution for savings would be to suspend all inflation adjustments government-wide for one year, or perhaps all inflation adjustments up to 3% (if inflation exceeds 3%), and call it a one-time “correction” for 30 years of ever-so-slightly (on average) overstating the true inflation rate. Another small-ball move that actually is almost sure to be part of any package, big or small, will be to tie the Medicare eligibility age to that of Social Security, which is rising slowly for the next 15 years or so. To save more money, that eligibility-age hike (for both programs) could be accelerated just a tad, so that the new age of eligibility reaches 67 (from 65) a year sooner than it would under current law.

Anyway, things like that are “small ball” in that they are almost imperceptible, but when all combined they add up to significant savings over time.

I don’t know which approach is best — grand plan or small ball. But it’s a choice that will need to be made soon.

More on this in future posts.

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