Outside the Beltway

Congress In Chaos Over Payroll Tax Cut Extension

Doug Mataconis · Monday, December 19, 2011 · 7 comments

Yesterday’s announcement by House Speaker John Boehner that the House GOP would not support the two-month extension of the Payroll Tax cut passed by the Senate has thrown Congress into chaos:

Senate Majority Leader Harry M. Reid on Monday rejected a demand from House Speaker John A. Boehner to reopen negotiations on a measure to extend a payroll tax cut, setting the Democratic-majority Senate on a collision course with the Republican-controlled House as a year-end deadline approaches.

With a deadlock over the measure looming, Reid (D-Nev.) warned that millions of Americans could see their taxes rise by $1,000 next year because of what he called the “intransigence” of GOP House members. Democrats also sought Monday to ramp up pressure on GOP lawmakers by launching robocalls in 20 districts across the country.

The White House, meanwhile, urged House Republicans to “do the right thing” and pass the bill already approved by nearly 90 percent of senators, including 83 percent of the chamber’s Republicans.

Boehner (R-Ohio) said Monday morning that the House is poised to defeat the Senate-passed bill to extend the payroll tax cut for two months because the measure “creates uncertainty” for the U.S. economy. Instead, he said the House would send the bill to a bicameral conference committee. Boehner on Sunday began retreating from his previous support for the package because of opposition from conservative Republicans.

“I expect that the House will disagree with the Senate amendment and instead vote to formally go to conference,” Boehner said at news conference as House members were returning to Capitol Hill from a weekend recess.

Two hours later, Reid hit back, saying that negotiations were over. He said the House has two options: Accept the bipartisan compromise he worked out with Senate Minority Leader Mitch McConnell (R-Ky.) or allow taxes to rise next month.

“Senator McConnell and I negotiated a compromise at Speaker Boehner’s request,” Reid said. “I will not reopen negotiations until the House follows through and passes this agreement that was negotiated by Republican leaders and supported by 90 percent of the Senate.”

He said negotiations for extending the tax cut for a full year should continue in January. But, for now, Reid said, both chambers should adopt the two-month deal.

“My House colleagues should be clear on what their vote means today,” he said. “If Republicans vote down the bipartisan compromise negotiated by Republican and Democratic leaders, and passed by 89 senators including 39 Republicans, their intransigence will mean that in 10 days, 160 million middle-class Americans will see a tax increase, over 2 million Americans will begin losing their unemployment benefits, and millions of senior citizens on Medicare could find it harder to receive treatment from physicians.”

Reid said Boehner “should not walk away from” the negotiated compromise, “putting middle-class families at risk of a thousand-dollar tax hike just because a few angry Tea Partiers raised their voices to the speaker.”

In a White House news briefing, press secretary Jay Carney said Monday that Boehner had urged fellow House Republicans to support the Senate measure. “So he was for it before he was against it,” Carney said.

It would only take 26 Republican House members to split away and vote yes, along with all the Democrats in the House, for the deal to pass, but it’s unclear if that could happen. The House GOP caucus has displayed rather remarkable unity on these issues this year. Meanwhile, Senate Republicans are already starting to break away from their House colleagues:

Senate Republicans have started bailing on their House counterparts, criticizing the House GOP majority over a plan to reject a Senate-passed payroll tax cut extension.

At least four GOP senators had expressed displeasure with the House by mid-afternoon, as they feared House intransigence would lead to a politically and financially painful 2 percent increase in workers’ Social Security taxes on Jan. 1.

But with just hours to go before the pivotal vote, House leaders remained confident that the rank-and-file would stand strong against the Senate’s two-month extension. The flurry of activity exposed House Republicans to political isolation, with the president, House and Senate Democrats, and even a handful of Senate Republicans laying the groundwork to blame them if taxes go up on 160 million Americans.

After such a bitter year on Capitol Hill, it only seems appropriate that this latest must-pass bill would have yet another partisan twist, confirming the widespread sense of dysfunction that has become the dominant theme of this Congress.

Indeed it is. Yesterday, I noted that Boehner had point when he said that a full year extension is better than a two month extension. That remains true, but at this point they don’t have a choice between a two month extension and no extension at all. And who, exactly, do the Republicans think will get blamed for that one?