My own little wishful-thinking idea, just posted on CNN.com:
Here’s one way it could work out:
1. By the Thanksgiving deadline, the second-round super committee recommends legislation that would obligate Congress and the administration to strict pay-as-you-go rules on any future extension of expiring tax cuts. The pay-as-you-go rule means that any proposal includes a method to offset the cost, so the proposal does not add to the deficit.
This would include a promise to pay for any extension of any part of the Bush tax cuts at their next expiration date, which is the end of 2012. Relative to current policy, this would save $2.5 trillion over 10 years, and relative to Obama policy, this would still save $1.8 trillion.
2. At the same time, the super committee could identify and bring up for vote specific proposals to raise revenue by reducing certain tax expenditures in fair and economically efficient ways, providing a down payment on the offsets required for the future tax rate extensions. President Obama’s proposal — made in all three of his budgets thus far — to limit itemized deductions to 28% is a good example.
This would give policymakers another year to develop and debate specific tax reform proposals that would fully comply with the pay-as-you-go rule on the Bush tax cuts.
Such a strategy would recognize the disagreements between and within the political parties about tax policy’s role in deficit reduction, and would set up steps to help resolve them. And it would force policymakers into intensive tax policy therapy for the next year and a half. They clearly need it.