MELISSA BLOCK, HOST:
And that note on the budget stalemate brings us to our regular Friday political commentators, E.J. Dionne of The Washington Post and David Brooks of The New York Times. Gentlemen, hello.
E.J. DIONNE: Good to be with you.
DAVID BROOKS: Good to be with you.
BLOCK: Once more into the reach on the fiscal cliff. House Speaker John Boehner came out today. He said there's no progress to report, so he couldn't give a progress report. He said the president's my way or the highway approach on raising rates on top earners is standing in the way of agreement. David, how much of this is bluster and for all the sharp tone and the posturing, how much do we assume that behind the scenes they are figuring out some kind of middle ground here?
BROOKS: He's fibbing. I think it's about 98 percent bluster. I think they are beginning to do the dance. And the dance is that Obama's going to get the rate increases. He's probably going to get the debt ceiling. And they've got to figure out how much entitlement reform there is thrown into that. So it's a dance of what the proportions are between the various things in the deal.
They've been through this before. They know what the various pieces are, but they've got to do a subtle dance so each doesn't give too much. The president knows he has an advantage, but does he press too hard. The Republicans know they're at a disadvantage, but they can't really give away the store because their base will revolt. So it's a subtle dance and the question is now, I think, do they have the skill to do that dance.
BLOCK: So E.J., that line in the sand that Republicans drew about not raising tax rates, David seems to be saying that line is getting blurred. Do you agree?
DIONNE: I think that line is almost eliminated. You're hearing from a lot of Republicans that even if they don't make a big deal, they'd be better off to agree to pass the bill the president wants, which is protect taxpayers earning less than $250,000 from a tax increase. That actually gives the Republicans some leverage. They can say, all right, we'll give you the rates, but we're not going to negotiate on anything else.
And I think a couple of the things the president really does want that are not on the table yet are the extension of the payroll tax holiday, which he thinks, and I agree with him, are as important to keep the economy growing and also the extension of unemployment insurance benefits. And so that's like one card the Republicans have. But I have never felt that we were going to go over the cliff in a disastrous way, which is to say, even if we go over for a couple of days, I think there will be some kind of deal. The question is, is it a big deal or a small deal?
BLOCK: So do you assume, then, that if the tax rate does go up on those top earners, it falls shy of that 39.6 percent that President Obama has said he wants, maybe they end up, I don't know, 37, 36 percent. Is that what we're looking at, David?
BROOKS: I think that's the most likely thing. The big thing here, to me, and I think what became clear this week is that the Republicans essentially said they were a problem for Boehner. Boehner wanted to do a big deal a year and a half ago and the Republicans in Congress were a problem. I think they as much as said to him en masse, we're not going to be a problem this time. Do the best you can. We'll be behind you. And that was a major move. And now the question is, does Obama really want to drive a stake into the Republican heart or does he want to actually do a deal.
DIONNE: I think that, you know, slightly lower top rate is possible, but I still think that, for Obama, that's real matter of principle because he's been talking to people about this, not simply as a budget matter, but he's talked a lot about economic inequality. And he's saying, look, we don't have a lot of levers on economic inequality. One of them is the tax rate and what we can do with the money we raise. So he may settle for something slightly less, but I don't think he's going to settle for a lot less. And I still think he may hold out for a while.
BLOCK: Let me ask you this, there was a December surprise yesterday from the junior senator from South Carolina, Jim DeMint, a staunch conservative, Tea Party favorite. He said he's leaving the Senate and he's going to go head the conservative think tank, The Heritage Foundation. He talked about that yesterday on Rush Limbaugh's show.
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BLOCK: David Brooks, what about that? Do you give Jim DeMint credit for the success of Senators Pat Toomey, Mark Rubio, Ted Cruz or blame him for the failures of candidates who he backed who lost, Richard Mourdock, to Todd Akin, Sharron Angle, the list goes on and on.
BROOKS: I guess I give him credit for both. You know, he had some pluses and minuses as the Tea Party did. I think on that they were net minus. I think the basic thing is here, first, he's going to a job that's much higher paid than the one he's got. But my basic view is that he was never really a legislator. He was more an ideologue, more someone who took pure stances.
And people who take pure stances tend to want to go to places where they can be pure. And so he's going to go to a think tank where he can be pure, but it will take him out of the center of the action. And I think that's a likely trajectory for the Tea Party. They will marginalize themselves and self-(unintelligible) themselves into a position of marginal purity over time.
BLOCK: And, E.J., what broader message, if any, do you see from Jim DeMint's departure?
DIONNE: Well, I think he is more a movement leader than someone who loves the Senate. In fact, he doesn't seem to like the Senate that much. I think you're seeing a lot of rumblings in the Republican Party and among conservatives where they are, for the first time in 30 years, responding to liberal arguments.
From Reagan forward, it was liberal responding to conservative arguments, the most famous moment being when Bill Clinton said the era of big government is over.
Now, this week, you had Paul Ryan and Marco Rubio out there saying, wait a minute, we're not that anti-government. Government has a role. We shouldn't be the party of millionaires. It's actually they don't matter nearly as much as the middle class. And I think you can say this is rhetoric, but rhetoric matters over the long run.
And I think that this is the first time that progressives have gotten into the heads of conservatives. It's been the other way around, conservatives getting into the heads of progressives.
BROOKS: I would say it's the end of the era of the rising tide lifts all boats. The Republicans assumed if you improved the business climate, then everybody in the country would see the benefit. But a lot of Americans decided that doesn't work, either because they're working harder but not seeing wage gains, or they don't have the human capital. But so you can't just have one business climate strategy for the whole country and assume everybody would be better off. Republicans are beginning to concede that reality.
BLOCK: Another possible sign of Republican recalibration here. We saw John Boehner this week angering Tea Party conservatives when he took coveted committee assignments away from four Republican members who had bucked the party. He says it's not a purge, but he told the caucus we are watching all your votes. Are we looking at a new period, do you think, of Republican infighting, E.J.?
DIONNE: Well, so far he hasn't gotten a big reaction. I think some of it will depend on what kind of deal he makes with President Obama. But he seems to be in control. And, by the way, one of the ones he moved he didn't move because he was too conservative. Walter Jones has been a really courageous Republican on issues like the Iraq and Afghanistan wars. So he was thrown in with the three conservatives.
BLOCK: David, last word?
BROOKS: Yeah, I think they want to play politics, and they want people who will cut deals and follow the leader. So it's about discipline, but also being realistic about what's possible.
BLOCK: OK. Have a great weekend.
DIONNE: You, too.
BROOKS: And you.
BLOCK: David Brooks of The New York Times and E.J. Dionne of The Washington Post and Brookings Institution.
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