Payroll tax deal close: Why did Republicans back down? (+video)
Senate Republicans came to a realization on the payroll tax cut fight: We got the policy right but the politics wrong and it’s time to move on. Specifics of the deal are still being hashed out.
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The draft deal also includes offsets for extending the “doc fix.” These include cutting Medicare reimbursements to hospitals and cutting anti-smoking and obesity funding in the president’s signature health-care law.Skip to next paragraph
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“They’re not going to get unemployment and the doc fix without significant reform,” says Rep. Tom Cole (R) of Oklahoma. “I wouldn’t vote for the final product without the federal workforce [pensions] in it.”
House Republicans took a beating on blocking an extension of the payroll tax hike in December, as they remained the last holdouts to a deal backed by the White House, most Democrats and Senate Republicans, and even Americans for Tax Reform – the self-appointed guardians of the “taxpayer protection pledge,” signed by most GOP members of Congress.
“While a spending cut offset is ideal, it is not necessary,” said a statement on the Americans for Tax Reform website. “It doesn’t ‘cost’ taxpayers anything to let taxpayers keep their own money.”
“It’s not fair to subject tax relief to the same need for spending cut offsets that conservatives rightly demand of new spending programs,” the statement continues. “The latter is a new burden faced by taxpayers. The former is easing the burden on taxpayers.”
House and Senate Democratic leaders backed the deal, subject to seeing the final details. They see the prolonged legislative battle, especially the refusal of GOP leaders to consider a tax hike on high incomes to help middle class workers, as a plus for their side heading into an election.
“If you want to have an argument about whether you want to help people making $40,000 or people making $1 million, we’re happy to have that argument,” says Nadeam Elshami, a spokesman for House Democratic leader Nancy Pelosi. “We’ve won that argument.”
With Congress in recess next week, lawmakers have until Friday to vote an extension of expiring benefits – a deadline leaders on both sides of the aisle say they expect to meet.
Otherwise, they said, the policy undermined Social Security for the long term and added to the $1 trillion-plus federal deficit.
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