The willingness of some Republican lawmakers to consider tax increases opens the possibility of addressing the looming fiscal crisis in a balanced waymeaning with spending cuts and increases in the revenues collected through taxes.
For the past 26 years, a majority of GOP politicians at all levels have signed the anti-tax pledge of Americans for Tax Reform (ATR), committing not to raise taxes. If they break this pledge, Grover Norquist, president of ATR, looks for a challenger to defeat the person violating the pledge.
This practice has turned Norquist into one of the most influential figures in Republican circles. However, fortunately, his stardom seems to be diminishing.
Because of the economic and fiscal crisis, a new generation of GOP candidates refused to sign the pledge in the last election. At the same time, the defeat of Republican congresspersons and senators at the polls decreased the number of lawmakers in Congress who are bound by this pledge.
To this, we must add the fact that in recent days, Republican senators have dared to distance themselves from the ATR pledge signed years ago.
This newly found freedom does not mean that Republicans are setting aside their tax-cut philosophy. However, it is a pragmatic signal to their party colleagues and the White House that they are willing to negotiate without external ties.
We think this is a necessary disposition to tackle negotiations to avoid the $600 billion fiscal cliff, which involves tax hikes and spending cuts that would enter into effect next year.
The negotiations are still in their early stages and there is more uncertainty than known details. Nevertheless, having Norquist lose influence is already a very positive development.