Economy & Budget

Gingrich: Leaders should look to Reagan-O’Neill compromise of 1982 for fiscal cliff talks

Gingrich: Leaders should look to Reagan-O'Neill compromise of 1982 for fiscal cliff talks

As Republicans and Democrats prepare for their meeting with President Obama at the White House over the looming fiscal cliff, former Speaker of the House Newt Gingrich says that Republican leaders don’t need to compromise and if they do, the fear of a split in the Republican Party is a real possibility.

“Republican leaders don’t have an obligation to compromise with President Obama and if they do compromise, they split the Republican Party,” Gingrich said in an interview with Human Events on Tuesday.

After President Obama’s re-election last week, pundits and politicians, including Senate Majority Leader Harry Reid (D-Nev.), have said the American people have given the president a mandate, but Gingrich says that Republicans have to communicate two important messages leading up to and during Friday’s meeting at the White House.

“Republicans have to insist that there were two mandates on Election Day. There’s a mandate for Obama and there is a mandate for House Republicans. So, it’s important to put in context that they are meeting as equals to talk about the country… They are not working for Obama, but they are willing to work with Obama,” he said.

Both Speaker of the House John Boehner and the president have shown their hand this week on laying groundwork for the fiscal negotiations. Mr. Boehner opened the door to new tax revenues, but told reporters that any sort of deal would need to include reforming the tax code and lowering tax rates. A simpler tax code, he said, would lead to more tax revenues. Shortly thereafter, Mr. Obama indicated that he was encouraged by Mr. Boehner’s offer, but remains insistent on raising taxes on Americans he deems in the upper-income bracket.

The best way for Republicans and Democrats to come to an agreement, Gingrich said, is to look at the parallels between then-President Ronald Reagan and Democratic Speaker of the House Tip O’Neill when those two came to a deficit compromise in 1982.

Republicans won the Senate, but did not have the House after Reagan won the White House in November and the newly elected president was forced into a give-and-take with O’Neill.

“O’Neill understood that he had to give Reagan a chance, but didn’t have to carry the president’s water. So, O’Neill always had a Democratic Party proposal and would then allow the president’s team to create an alternative and if the president and his team could get the votes to pass it in the House, that was fine. He [O’Neill] gave them a fair chance to have a vote on it.”

Budget Committee ranking member Rep. Chris Van Hollen (D-Md.) indicated at the Wall Street Journal CEO Council meeting that the Simpson-Bowles plan to restructure government finances, developed two years ago by President Obama’s Commission on Fiscal Responsibility and Reform, serves as a great framework to start the new round of ‘fiscal cliff’ talks. Gingrich disagrees.

“There’s a reason Paul Ryan voted against it. Simpson-Bowles is a deliberately centrist document that was designed to compromise everything with everybody. Now, the national establishment would love to have everything centered around Simpson-Bowles, because the national establishment believes in higher taxes.” The plan’s name refers to the co-chairs of the commission, Alan Simpson and Erskine Bowles.

In the aftermath of Boehner’s comments and last week’s election results, conversations about reinventing the Republican Party have gained traction. Some have argued for a less conservative, more inclusive party, but Gingrich believes that jumping to conclusions too quickly is not the way to go.

“We [Republicans] need to respect the fact that he won the presidency, but he needs to respect that we won the House.”

On the question of whether or not the president will be willing to compromise since he has been re-elected, Gingrich isn’t sure yet.

“Does he want the next four years to be as difficult as the last two, or does he want to slow down and really listen to a genuine dialogue?” he said.

Adam Tragone is managing editor of Human Events.

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