President Obama is leading Mitt Romney in the polls, but even if he wins in November, he’ll soon face another daunting problem: The fiscal cliff.
To avoid the series of tax hikes and spending cuts that are set to take effect in the new year, Congress will need to agree on a plan shortly after the elections and the one they may favor could put President Obama in a tight spot, according to Nobel Prize-winning economist and New York Times columnist Paul Krugman.
That likely plan is commonly referred to as Simpson-Bowles, named for authors Alan K. Simpson and Erskine Bowles who were appointed co-chairmen of President Obama's deficit commission, which failed to agree on a plan of its own. If President Obama were to go along with the plan, he would be forced to commit a “betrayal to the electorate,” according to Krugman, since the proposal makes changes to Social Security and Medicare that jeopardize the safety net, while lowering the marginal tax rate, which he says does little to reduce the deficit.
Krugman has used even stronger language to criticize Simpson-Bowles in the past. He penned one blog post earlier this year called “A Public Service Reminder: Simpson-Bowles Is Terrible,” while in another post Krugman called the proposal, “a really bad plan.” For Krugman, it seems, if Obama caved to a plan even based on the original Simpson-Bowles proposal he would be turning his back on voters who support him for his emphasis on preserving the social safety net.
But Krugman isn’t the only public figure to criticize Simpson-Bowles. Politicians on both sides of the aisle have spoken out against it, albeit for different reasons. Republicans, including Paul Ryan and one of Romney’s economic advisers, Kevin Hassett, have derided the plan, saying it will increase taxes, The Washington Post reports. On the other hand, Democrats have opposed the plan fearing that it makes too many cuts to Social Security among other concerns, according to Businessweek.
Then there’s Mitt Romney, who doesn't hold such disdain. In August, he told talk-show host Sean Hannity “My [deficit reduction] plan is very similar to the Simpson-Bowles plan," TIME reports.
Correction: A previous version of this post misidentified the Simpson-Bowles plan as the product of President Obama's deficit commission. It is the independent plan of that commission's co-chairmen.