The months-long battle in Congress over extending a payroll tax break “certainly caused damage” to Republicans because it “muddled” the differences between the parties over the issue, says House Budget Committee chairman Paul Ryan (R) of Wisconsin.
Early Thursday morning, House and Senate leaders agreed on a bipartisan deal that will extend, through the end of the year, a 2 percentage point reduction in 160 million workers’ Social Security taxes. The rate will stay at 4.2 percent of earnings, rather than revert to its usual 6.2 percent. Republicans in December had balked at a long-term extension of the tax break, but after intense criticism they agreed to back a short-term extension through February.
House Speaker John Boehner announced earlier this week that the House GOP leadership would no longer insist that the $100 billion cost of the tax break be paid for with spending cuts, because the Senate was unwilling to go along with the cuts. [Instead, the lost revenue for Social Security will be offset by money from the general fund, effectively adding to the federal deficit.
“The payroll tax deal, from a political perspective, certainly caused damage because it muddled the differences [between the parties]. It got us down into a skirmish where the differences got muddled, which is what I think the president loves,” Representative Ryan said at a Monitor-hosted breakfast for reporters on Thursday.
The influential House Republican directed his fire at the Democratic-controlled Senate. “It is a tough issue because they had to compromise,” Ryan said. “It is very frustrating that they, meaning the Senate, weren’t willing to cut $100 billion [from government spending] over 10 years.”
The House Budget Committee chairman added: “The idea of running against a dysfunctional, do-nothing Congress is ... part of [President Obama's] campaign strategy." Ryan charged: "In order for that to happen, the Senate has to be your enabler to make sure Congress does nothing.”