Congressional Republicans have a standard negotiating tactic, which has proven effective several times over the last year: hold the economy hostage until Democrats agree to capitulate on the major dispute of the day. The most notable example of this was last summer's debt-ceiling fiasco.
But when it comes to the payroll tax break, the GOP simply couldn't play the same game -- Democrats never believed their opponents would support a middle-class tax increase in an election year, denying Republicans any leverage. Indeed, it was arguably the first time in this Congress where Dems felt like they had the upper hand -- because they did.
Associated Press
As Tricia noted earlier, it was this advantage that helped produce a tentative deal on a larger payroll tax-break package.
Members of a House-Senate committee charged with writing a measure to extend a payroll tax reduction and provide added unemployment benefits reached a tentative agreement Tuesday evening, with Republicans and Democrats claiming a degree of political victory in a fight with significant election-year implications.
One day after House Republican leaders said they would offer a bill to extend the $100 billion payroll tax rollback for millions of working Americans without requiring spending cuts to pay for it, the Congressional negotiators struck a broader deal that would also extend unemployment benefits and prevent a large cut in reimbursements to doctors who accept Medicare.
A vote on the measure would most likely happen by Friday, when Congress is set to recess for a week.
The agreement is not yet final, and could still fall apart, but officials on both sides of the aisle appeared confident overnight that the deal would come together and reach President Obama's desk no later than the weekend.
Democrats proceeded under the assumption that, as was the case in December, the GOP's posture would change as the deadline drew closer. That's exactly what happened, with Republicans growing anxious as the prospect of a tax increase on 160 million Americans -- one that the GOP would be blamed for -- grew more serious.
As work on the final agreement wraps up, the debate now turns to which side made the most concessions, and whether the deal is any good.
On the latter, most economists seem to agree that a lapse in the payroll tax would have dealt the burgeoning economic recovery a swift blow at an inopportune time. The same is true of extended unemployment benefits. To that extent, this agreement, if approved, will bring a sigh of relief to many concerned about 2012 economic growth.
On the former, both parties had to accept some compromises, but it was Republicans who'd already surrendered on the most contentious point: GOP leaders agreed on Monday to accept the payroll tax break without paying for it. Once this component was in place, the larger deal was much easier to strike.
For their part, Dems abandoned the goal of a surtax on millionaires and billionaires, and accepted alternate financing to pay for jobless aid and the Medicare "doc fix," related to physician reimbursements. Unemployment benefits will be paid for through changes to federal pensions, while the Medicare portion will be paid for through cuts the White House had already proposed.
Republicans, meanwhile, wanted new education requirements and drug testing for beneficiaries, and both measures were scuttled. They also fought against the payroll cut itself, and gave in on this altogether.
One area to keep an eye on is the UI provisions. GOP officials fought to reduce the maximum eligibility from 99 weeks to 59 weeks, and Democrats countered with 93 weeks. This deal sets the new number at 73, though there will apparently be "tiers" affecting states with the most severe jobs crises.
Another procedural element to watch is how the deal advances: if it can be approved through the conference committee, the opportunity for amendments disappears and the process will move much quicker.
Overall, it's an agreement that will likely be approved with significant Democratic support, which will be necessary since a large number of rank-and-file Republicans will see the deal as not nearly right wing enough.
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Republicans knew that they blew it with their absurd embrace of Tea Party opposition to tax cuts for working Americans. The public has punished the GOP severely for such a stupid position, and Republican leadership was not going to make the same mistake twice. So they have laid a trap for Democrats and the White House, which appears to have succeeded. The GOP gets to tout the payroll tax cut, but Democrats have sacrificed vital unemployment benefits that are imperative to the success of our economy. Millions of unemployed Americans will be forced out of their meager benefits. http://www.sunstateactivist.org
While I applaud this "bi-partisan" effort, please don't believe that the GOP has actually seen the light and are willing to work in the best interests of 99% of Americans!! Frankly, I think this is a "pause" so that they can re-group and double down on once again NOT passing the Presidents budget!!!
Why should they. Even Harry Reid isn't pushing it. It's a political statement, not a reality statement
Democrats never believed their opponents would support a middle-class tax increase in an election year
Insert "presidential" before "election year". In the midterms, Republicans are confident they can bamboozle the voters.
Congressional Democrats won another major victory by standing up to the playground bullies on the Republican side, and the 73 week UI limit is meaningless thanks to two things: First, there are a significant number of exemptions and extensions for the chronically unemployed and, second, Democrats will revisit the issue and get through another extension when it's needed - either in the near future or after the election.
I suspect that even Tea Baggers in Congress are loathe to go into an election handing opponents in their district an issue of "He/She wants your kids to go hungry!"
When did CSPAN become the comedy channel?
Kantner: Where do we go from here, chaos or community?
So, Middle and Working Class, honest men and women who work arduously for themselves, their loved ones, their neighbors and their communities won a victory in the House of the People!
Hurray! It's been a struggle for us these past 3 1/2 years what with the death panels lurking about. How about those socialists who want to run our lives? Sharia law is staring us in the face, oh my! Unions are bullying Koch Bros. operations, what will we suffer next. The boys over at Wall St. aren't felling the love and know the ingrates among us are to blame! And what about those drug addled unemployed 99%ers?
Yes, as we've suffered from an economic collapse sponsored by the business as usual relationship between our Washington Representatives and their lobbying overlords, the exhaustion is perhaps finally catching up to those among us who would normally do the bidding of the 1%, but now find themselves hovering over a very pissed off Middle and Working Class block of voters.
What is a Republican to do? -Kevo
Whew that was a close one. For a second there I actually believed the wealthy were going to be taxed.
Ever get the feeling that you are just a speck of dust to be gathered up at election time and then tossed back into the trash?Ever wonder how two teams can have a tug of war yet in the end drop the rope right back where it started while each side claims victory?Success! We fooled those voting fools again now back to our sponsors.
I don't think there will be any more Republican hostage taking this year because it will remind the voters who is doing the hostage taking. This would be a disaster for Republicans if it occurs near the elections. However, the Bush tax cuts are still not resolved. The issue will not be dealt with until we are close to the elections. If the Republicans stand to lose a lot of seats in the House, they will try to make a hasty deal before the new Congress. If the Republicans think they are going to win Congress and possibly the presidency, they will wait until the new Congress and make the cuts permanent. I believe the cuts will become a campaign issue because the Republicans have run out of issues to beat Obama. If they make it a campaign issue it could force Obama to deal with the issue sooner.
OK so most of us get 10 or 20 extra bucks a week at the expense of either our Social Security account or the general national debt (currently approaching $16 Trillion). It's like taking a cash advance on a credit card - yeah I got extra $$ in my pocket now but I will have to pay it back in the future with interest. I just cannot believe they could not figure a way to pay for this. If the Republicans would not budge on increasing taxes on the wealthy to pay for this, maybe we could have paid for it by a teeny tiny tariff on imported goods or fees on international transactions. I just don't understand how we can feel as good as we do on something like this going through. Now our kids most likely will pay for our nice little "weekly allowance" we are getting. And I can almost gaurentee that this will become permanent. Oh well, it's just that funny wacky D.C. financial "magic".+
And before anyone starts calling me a thick-skulled right winger - I know that the Bush tax cuts were a far worse version of this. That does not make it OK in my mind just because "they" did it, so we should too (not pay for tax cuts).