As the election season barrels towards the end—we’re only twenty-eight days away—key players in Washington are already maneuvering to deal with the so-called “fiscal cliff” that awaits on the other side of November 6. Tuesday, Senator Chuck Schumer delivered one of the most crucial speeches to date.

There’s an important caveat at the end, but most of the speech ought to make progressives awful happy, as Schumer is boldly trying to pull Democrats away from flirtation with dangerously regressive tax policy.

Here’s why: the dirty little secret of President Obama’s re-election is that, despite campaigning extensively on a pledge to end the Bush tax cuts for wealthy Americans, it has seemed fairly likely that Obama would be inclined to sign a fiscal cliff deal, or a deficit reduction deal later in his term, that did the exact opposite—one that lowered rates across the board.

Recall that during the debt ceiling negotiations, according to all available reporting, Obama was prepared to accept a tax code overhaul that would lower all income tax rates in exchange for $800 billion in new tax revenue gained by closing loopholes and exemptions. This is basically what the Simpson-Bowles plan does: it calls for the top income rate to be no higher than 29 percent (and as low as 23 percent), offset by raising the capital gains tax and closing exemptions and loopholes.

And although his campaign contains many paeans to tax fairness, at the same time Obama has also said that he is “eager to reach an agreement based on the principles of my bipartisan debt commission.” (That’s a quote from his acceptance speech in Charlotte—not exactly an insignificant address). Meanwhile, key Democrats in Congress—Senator Dick Durbin and Representative Chris Van Hollen—have explicitly called Bowles-Simpson a “template” for a debt deal in recent weeks.

Today at the National Press Club, Schumer kicked out the stool from beneath supporters of any such plan—a speech his press office billed as one in which the New York Senator calls for “scrapping the Reagan-style tax reform model used by Simpson-Bowles.”

“It is an alluring prospect to cut taxes on the wealthiest people and somehow still reduce the deficit, but you can’t have your cake and eat it, too,” Mr. Schumer said. “The reality is, any path forward on tax reform that promised to cut rates will end up either failing to reduce the deficit or failing to protect the middle class from a net tax increase.”…

“If upfront rate cuts are the starting point for negotiations on tax reform, it will box us in on what else we can achieve. Certain conservatives will pocket the rate reductions and never follow through on finding enough revenue elsewhere in the code to reduce the deficit. Or, if they do, it will almost certainly come out of the pockets of middle-income earners,” he said.

Schumer is right on every policy point here. If Congress does actually agree to remove a whole bunch of major tax deductions and exemptions—an enormous “if”—in order to make the math add up, those lost deductions would have to include many important to the middle class, like exemptions for retirement savings and college tuition. Afterwards, opportunistic members of Congress would almost certainly build the deductions back into the tax code—that’s what happened after the tax code overhaul of 1986. So you’d return to a similar tax code, just one with much lower rates.

Most importantly, across-the-board rate deductions are just terrible public policy that’s bound to increase inequality. They disproportionately benefit top earners, as this chart from CBPP shows:

In the speech, Schumer finishes with a call to preserve the Clinton-era rates on top earners while also raising capital gains rates and eliminating some deductions not harmful to the middle class, like the carried-interest loophole.

Schumer is the leader on messaging and policy in the Senate, and his speech today marks an important shift in the fiscal cliff debate. He’s openly demanding that his party not enter into negotiations with a pre-compromised position on tax policy.

There is one major caveat, however—acknowledging that this approach will be fiercely opposed by Republicans, he proposes “serious entitlement reform” as an enticement to the bargaining table. Given that the approaches to the safety net attractive to Republicans involve privatization, deep cuts, raising eligibility ages or some combination thereof, this is a dangerous offer.

But consider a few things: Schumer said today that privatization is off the table, meaning that whatever “serious entitlement reform” he’s talking about is likely along the lines of what’s already been offered. So it’s not clear what he is substantively proposing to offer the GOP here.

Moreover, as David Dayen theorizes, in the end this makes a “grand bargain” on the deficit less likely. (Remember, we don’t need a grand bargain on the debt. All that happens on December 31 is that all the Bush tax cuts expire—something that would in itself go a long way towards reducing the national debt.) The only thing that even got John Boehner to the bargaining table during the debt ceiling debacle was that the tax reform didn’t raise rates. (The increased revenue still ended up being too much to handle for his party.) But if Democrats adopt Schumer’s line, it’s extremely difficult to see the GOP agreeing to any grand bargain deal. So these “serious entitlement reforms” would never happen anyhow.