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How Democrats Learned To Stop Worrying And Love The Fiscal Cliff

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Replace the word "Democrat" with the word "Republican" and nearly every GOP statement about January's "fiscal cliff" applies perfectly to what actually happened in the debt limit fight a year ago. They know this, but they also know that procedural consistency amounts to perpetual surrender in politics, so they're toeing this line without much shame.

Given that they've invited the comparison, though, it's worth walking through the differences and similarities between the two scenarios.

The "fiscal cliff" is actually in large measure a consequence of the debt limit fight -- and the ongoing brinksmanship over how to avoid it stems almost entirely from the fact that Republicans are terrified or unwilling to vote for anything that raises revenue even modestly.

Remember, in the debt limit fight, Republicans had a set of demands, and refused to increase the country's borrowing authority unless Democrats met all of them. They basically got what they wanted: About $1 trillion in cuts to discretionary spending over 10 years a real chance to bully Democrats into cutting entitlement spending by about $1.2 trillion on top of that. The Democrats' terms of surrender, included an enforcement mechanism that will take a meat axe to domestic and defense spending early next year unless Congress replaces it with more targeted budget cuts.

A year later, Congress isn't any closer to averting that so-called "sequester" -- but it's not because roles have reversed. It's because Democrats have decided to call Republicans' bluff.

Remember, we're watching the exact same argument unfold: Last year Democrats were happy to meet Republican demands for budget consolidation as long as Republicans were willing to look at both spending cuts and higher revenues to achieve it. Republicans refused, and faced with the destructive consequences of a default, Democrats caved.

This time around, it's not that Democrats are willing to shoot the hostage. It's that they're willing to let Republicans shoot the hostage. There will be no ransom this time around.

In part that's because the politics are much different -- it's an election year, the economic consequences of tumbling over the fiscal cliff won't really be felt until the election is over, and the Democrats have an easily accessible argument: "Republicans are taking hostages in order to renew tax cuts for the rich."

But these are also very different hostages. The distinction won't register loudly in the public debate, but it's crucial. If Congress pulls the country over the fiscal cliff, it can at any point deploy a parachute. It'll harm the economy, but in a quickly reversible way. If Obama wins, and Republicans refuse to budge, Democrats can undo a lot of the damage retroactively, with a massive tax cut for income up to $250,000, and delay or complete elimination of the sequester.

By contrast, if the Treasury had run out of borrowing authority last year, the economic fallout would've widened and widened until either Republicans folded or the country defaulted and the damage became irreversible.

Which is all to say that the political and economic stakes are much different this time around. And now that Democrats are forcing Republicans to choose between the hostage and their anti-tax pledges, Republicans are trying to shirk responsibility for the crisis altogether.