Now Democrats are saying there is "renewed interest" in a hard cap of as much as $35,000 on deductions, which could allow for significantly higher taxes to come in from rich filers, without officially raising their tax rates. (The President has previously proposed a cap based on the percentage of income tax paid, but that has never gone anywhere in Congress.) The big difference between Romney's cap and the Democrats potential thievery of it, is that he wanted to use it as a trade-off for cut taxes for everyone. The Senate Democrats may just use it as an alternative to raising tax rates.
Since the key challenge for both Republicans and Democrats in this fiscal cliff drama is finding a way to raise more money without raising taxes, eliminating deductions could become the key part of any compromise. And rather than fight tooth and nail with deductions are worthy—mortgage interest! tuition! medical expenses!—the easy solution might just be putting a flat limit on all deductions and calling it a day.
Meanwhile, Glenn Hubbard, who was on the short list to become Romney's Secretary of the Treasury, published an op-ed in the Financial Times today explaining what he thinks is the best way to avoid the fiscal cliff. (Short answer: Cutting spending, while also lowering "average tax rates," not the posted marginal rates. That would also mean a lot of deduction cutting.) It's a bittersweet teaser for those Republican voters wondering "what might have" had Mitt Romney won the argument. And, again, information that might have been more useful before November 6.