House GOP balking at two-month extension of payroll-tax holiday

posted at 10:45 am on December 19, 2011 by Ed Morrissey

There are plenty of reasons to oppose a lengthy extension of the payroll-tax holiday.  There are plenty of reasons to support a lengthy extension of the payroll-tax holiday, too.  But are there really any good reasons for a two-month extension of the “cut”?  House Republicans are balking at the Senate bill heading their way:

The fate of a payroll tax cut extension backed by the White House and overwhelmingly passed by the Senate is uncertain after a restive House Republican conference expressed displeasure with the two-month deal.

Faced with the uprising on his right flank, House Speaker John A. Boehner (R-Ohio) retreated Sunday from his previous support for the package, saying the House does not expect to approve that plan on Monday night after it returns to Washington.

“Well, it’s pretty clear that I and our members oppose the Senate bill,” Boehner said in an appearance on NBC’s “Meet the Press.” “It’s only for two months. You know, the president said we shouldn’t go on vacation until we get our work done. And frankly, House Republicans agree.”

The move sets up the latest game of brinkmanship on Capitol Hill, in which a failure by lawmakers to pass a deal before New Year’s Day will result in a two percentage-point payroll tax increase on 160 million workers, the termination of unemployment benefits for some jobless Americans and a reduction in reimbursement rates for doctors who treat Medicare patients. Far-reaching repercussions for both political parties also loom.

The only reason to support this approach is to get President Obama to make a decision on the Keystone XL pipeline in the same time frame.  The expiration of the tax holiday would put pressure on Obama to approve the pipeline, but there is already plenty of pressure on Obama to do just that — from both parties.  The short time period would then allow Obama to raise the issue again and try to paint the GOP as opposing middle-class tax cuts, even though this has the effect of reducing contributions to the already-sinking Social Security fund without any of the investment benefits of long-term tax reform.

The White House, however, wants the House to pass this bill as an interim measure while continuing work on a one-year extension of the tax holiday.  That’s an argument that makes sense for those who believe extending this tax holiday is a good idea at all.  Congress has taken the same approach to budgeting for the last three years anyway, running the government on a series of continuing resolutions.  Why not do the same with this “tax cut,” if Republicans say as they do in the media that they want to pass a longer-term holiday anyway?

Frankly, that’s a good question.  If the GOP was to oppose the “holiday” as an ineffective and costly gimmick, I could support their new-found opposition.  If they’re just looking to pass a longer version anyway, I’d say take the pipeline and declare victory.  At least that way, we have a chance to argue one more time for ending these short-term Obamanomics gimmicks and focusing instead on real tax reform that could genuinely stimulate the economy, something that the payroll-tax holiday has utterly failed to do for the past year.


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These people need to man up and do their job. And this is mostly the Democrats.

2 months? Sure why not? We haven’t had a budget in 1000 days.

Idiots.

CorporatePiggy on December 19, 2011 at 10:50 AM

and a reduction in reimbursement rates for doctors who treat Medicare patients

This is the underreported part of the bill.

Let’s see how Obamacare really works without the Doc Fix.

BacaDog on December 19, 2011 at 10:52 AM

Since I never expect to see any of that SS I contribute…making it long and big. Heck, make it permanent.

CJ on December 19, 2011 at 10:52 AM

Why are we shifting more of the tax burden onto the Rich?

And why would we want to de-fund social-security?

Chip on December 19, 2011 at 10:55 AM

Permanent fee increases to Fannie and Freddie included in the Senate’s 2 month Social Security defunding bill.

forest on December 19, 2011 at 10:56 AM

Well reasoned Ed but not sure I fully agree. I wonder if it might make more sense to pass it as is and throw it into Obama’s lap. The nice thing about the latter would be that he’d be damned either way by one faction or another at a strategic time.

jeanie on December 19, 2011 at 10:56 AM

Gop will get the blame no matter what happens thanks to the lsm

cmsinaz on December 19, 2011 at 10:57 AM

Frankly, that’s a good question. If the GOP was to oppose the “holiday” as an ineffective and costly gimmick, I could support their new-found opposition.

Since there’s no way that Republicans will “kill the holiday” until after next November, why revisit it in two months? Yes, they can argue that the policy is an ineffective and costly gimmick until they’re blue in the face, but that won’t change anything until next year.

Rovin on December 19, 2011 at 10:58 AM

I say double or triple it and make it permanent!

Constitutional historian of conservative values on December 19, 2011 at 10:59 AM

Hey guys, if you want to get a clue as to why nobody is hiring, look in the mirror. The tax rate changes month to month or whenever Dear Leader needs a bump in the polls.

Mord on December 19, 2011 at 11:03 AM

I’d happily opt out of SS. It won’t exist when I retire and everyone my age (under 45) knows that unless they are total idiots.

CorporatePiggy on December 19, 2011 at 11:03 AM

I’m sick of Congress kicking issues down the road so they don’t have to make a long-term decision. That goes for payroll tax, budgets, and everything else. These people were elected to make the hard decisions that need to be made not to make deals that make everybody happy. The Congress should stay in session through the holidays if they can’t come to a meaningful long-term agreement. Oh! And stop paying them until they have passed a budget.

Happy Nomad on December 19, 2011 at 11:03 AM

this is obviously bush’s fault

acyl72 on December 19, 2011 at 11:05 AM

Hey guys, if you want to get a clue as to why nobody is hiring, look in the mirror. The tax rate changes month to month or whenever Dear Leader needs a bump in the polls.

Mord on December 19, 2011 at 11:03 AM

Yes, add to that the uncertainty of Controversial and Unconstitutional Obamacare and over-regulation and you have a recipe for economic stagnation.

And if you read some of the blogs from the Socialist-Oppressive left, you’ll realize they think they gain an advantage through it.

Chip on December 19, 2011 at 11:09 AM

A 2-month bill is a joke, as is a ‘continuing resolution’ (as is Congress – but I digress). Totally incompetent jackasses in the Senate who refuse to do the nation’s work by passing a budget. Reid is a disaster! No one has read this piece of crap which contains a Christmas tree of earmarks again. Why can’t these earmarkers ever be identified and thrown out or at least identified as throwing the taxpayers money away?? The Tea Parties’ work is never done throwing these bums out! And in 2-months, Obama will say he needs more time to study the Keystone pipeline deal. Will we have another 2-month bill?

Bob in VA on December 19, 2011 at 11:09 AM

Seems like the last couple of years, almost every bit of legislation is temporary. Can’t these dudes do their job right the first time.

I am AGAINST increasing the tax holiday because of WHICH taxes they choose to give the holiday. How about an income tax holiday? Nope, Congress can’t stop spending to do that, so they choose a SS tax holiday, the one fund that is bankrupt because of mismanagement and borrowing by the congress. There are some of us who have paid into SS for many years. Whether it’s likely or not, I’d like to see a few of the dollars I’ve paid into SS since I was 15 years old.

katablog.com on December 19, 2011 at 11:10 AM

How about 2 year holiday from Congress?

Except for the lack of Sunday morning TV, would we even notice?

BobMbx on December 19, 2011 at 11:12 AM

I know it’s only 2 months, but I would like to see this go to obama’s desk and see what happens.

Does he lose 5% by losing a few of the enviros by signing it, or does he lose 10%+ by vetoing it and killing @ 20K jobs

ConservativePartyNow on December 19, 2011 at 11:13 AM

SS had a secure funding scheme that was raided years ago. Now it has no assets in it’s lockbox. The current funding barely keeps it solvent but at least when Obama threatened to withhold checks last August it still had it’s own funding mechanism.

Deliberatly tossing SS into the general budget kills it. Quicker. Let the dems own this one.

DanMan on December 19, 2011 at 11:13 AM

Can we please stop with temporary tax cuts? The uncertainty is destroying our economy.

“Will my taxes be higher in the future, or won’t they? No idea. Guess I better sit on my money just in case.”

NotCoach on December 19, 2011 at 11:16 AM

Obama is raiding SS for short term political gain and the Republicans aren’t making this point.

Daemonocracy on December 19, 2011 at 11:19 AM

Whether it’s likely or not, I’d like to see a few of the dollars I’ve paid into SS since I was 15 years old.

katablog.com on December 19, 2011 at 11:10 AM

Here’s the dirty secret, Kata.

The money you sent in was spent within hours of the SSA receiving it. It either went directly to SSA recipients, or over the Treasury for the general fund, where it was spent within seconds of receipt.

Your dollars are gone. Any dollars you receive will those taken from peoples paychecks literally hours before you get your check.

Oh, the Treasury gives the SSA bonds in return. Nothing more than an IOU, which when redeemed comes from…you guessed it….your paycheck in the form of federal income taxes.

In other words, the SSA takes money from your paycheck. Until recently, some of it was more than required for SSA expenditures and the leftover was sent to Treasury. Now, SSA is redeeming those bonds, and you have to pay again, with interest.

BobMbx on December 19, 2011 at 11:20 AM

I just hope the senate keeps some R’s in dc over the Christmas holiday to prevent bho from doing recess appointments. He is counting on this, IMO.
L

letget on December 19, 2011 at 11:20 AM

Part of the Senate deal to extend the 2 percent payroll tax holiday is to add a fee to new and refinanced mortgages. On a $200,000 mortgage the added fee would amount to about $17 per month, or 17 * 12 * 30 = $6120 over the life of the loan, for a social security benefit that will net the tax payer $166 for the two months.

Dasher on December 19, 2011 at 11:20 AM

I agree with Ed. There is nothing to be gained by what Boehner is doing and a lot to be lost in the way of negative P.R. We need to pick our battles…

Force Obama to decide on Keystone in 2 months – that gives us time to build support and remind Americans of existing pipelines and actions by enviro groups like the Sierra Club to stop not only the Keystone Pipeline, but numerous others such as the “Alberta Clipper”.

Buy Danish on December 19, 2011 at 11:20 AM

katablog.com on December 19, 2011 at 11:10 AM

There is no SS trust fund, so SS is not being shorted through an SS “tax holiday”. It all goes into the general fund, broken up into different names, so a proper smoke screen can be applied to disguise how much we really pay in taxes.

NotCoach on December 19, 2011 at 11:23 AM

Doesn’t matter what “plan?” they decide on the Republicans will get the blame not the credit if any is due and that is questionable anyway.

sandee on December 19, 2011 at 11:24 AM

I’d say take the pipeline and declare victory. At least that way, we have a chance to argue one more time for ending these short-term Obamanomics gimmicks and focusing instead on real tax reform that could genuinely stimulate the economy, something that the payroll-tax holiday has utterly failed to do for the past year.

Err…yeah. The House GOP has been horrible getting the Republican message out. I don’t see how they could advocate eliminating the payroll tax holiday (“raising taxes on the middle class,” in Dem/MSM-speak) without coming out on the short end of the stick.

They are better off pushing the XL pipeline AND a year-long extension of the holiday, paying for it however they can without raising taxes.

DRayRaven on December 19, 2011 at 11:29 AM

Political gamesmanship has taken the place of serious discussion and legislative action on the pending collapse of our economy. Both parties are guilty but unfortunately only one will take the blame thanks to the media. The Republicans, and especially Boehner, are incapable of managing the message.

janjan on December 19, 2011 at 11:30 AM

All this demagoging and media frenzy about a 2 month deal that will put about $100 total in the pockets of taxpayers? What a joke. The Dems are more than happy to have another opportunity to bring up a millionaires’ surtax in 2 mos now when this expires, great.

thurman on December 19, 2011 at 11:32 AM

The real problem here for Republicans is that there is no political capital to be gained by inaction. You only lose ground politically for inaction. Obama and Democrats know that any rejection by the Republicans will hurt the GOP’s chances of winning the Presidency.

We need to somehow change the political reality that inaction is a negative. That is the real challenge for conservatives; to change the general cultural belief that government action is always worth a shot. Once a majority of independants reject the notion that government action generally makes the situation worse, politicians can gain ground for inaction. Until then, nothing in Washington will change.

RedSoxNation on December 19, 2011 at 11:33 AM

There is no way in the world the Republicans should accept a two-month extension. They should portray this as what it is; another short-term gimmick/kick-the-can-down-the-road moment from a party that absolutely refuses to deal with fiscal reality. They could and should say “We compromised on the supercommittee deal and look where that got us. We will no longer participate in the fiscal shenanigans the Democrats want to pretend is solving the problem so that they can secure their re-elections.”

If they Republicans sign on to an extention, they lose the ability to say they are taking the problem seriously.

They need to point to this situation as the fundamental lack of leadership from the Big O that has led to our current mess.

Nate Greene on December 19, 2011 at 11:35 AM

Regardless of the right or wrong of the bill, by not passing it the Republicans are looking obstinate, demanding to get their own way. It’s the perception, not the reality, but we all know perception IS reality.

Alabama Mike on December 19, 2011 at 11:36 AM

Pass it, the Keystone Pipeline is the important thing, the other stuff is just reindeer games.

Put Barry in the corner. Either the Keystone Pipeline gets an OK within two months (and he infuriates his lunatic environmental base), or he kills it and the GOP gets to beat him over the head with it until the election.

Either one is good, although what’s best is to get the pipeline approved and get more Americans to work.

NoDonkey on December 19, 2011 at 11:40 AM

Sounds like a terrible deal to me… Obama seems willing to (reluctantly-) accept the keystone pipeline after all. And the result? The GOP *still* imposes a “payroll tax increase on 160 million workers, the termination of unemployment benefits for some jobless Americans and a reduction in reimbursement rates for doctors who treat Medicare patients.” If it happens, I don’t think Tina Korbe will find much to gloat about.

MARCU$

mlindroo on December 19, 2011 at 11:47 AM

The move sets up the latest game of brinkmanship on Capitol Hill, in which a failure by lawmakers to pass a deal before New Year’s Day will result in a two percentage-point payroll tax increase on 160 million workers, the termination of unemployment benefits for some jobless Americans and a reduction in reimbursement rates for doctors who treat Medicare patients. Far-reaching repercussions for both political parties also loom.

As long as Boehner in charge we already know the outcome here. Everyone knows he is just bluffing. He doesn’t have the cohones to do what is actually the right thing to do.

Conservative4Ever on December 19, 2011 at 11:53 AM

Get rid of the early retirement option for SS. I’m going to take it, because I’d rather have a smaller amount for longer. It will take me 10 years to make up what I don’t get from 62 to 67 if I wait. And I ain’t gonna live until 77…

originalpechanga on December 19, 2011 at 12:06 PM

The House is correct on this.

SouthernGent on December 19, 2011 at 12:11 PM

The real problem here for Republicans is that there is no political capital to be gained by inaction. You only lose ground politically for inaction. ….

RedSoxNation on December 19, 2011 at 11:33 AM

I am firmly against the notion of “we have to do something”. I really like the idea of Rick Perry’s idea of a part time Congress. The Constitution requires congress to meet one day a year.

Dasher on December 19, 2011 at 12:22 PM

There’s only one right way to do this and it’s to pass a bill, send it to the Senate, if they reject it, tell them to pass a budget and put what they want in it and you’ll work it out, then go home.

The fact that the Senate hasn’t passed a budget in over 950 days just irks the hell out of me and, the only reason they won’t is because our illustrious free press keeps giving them a pass on it.

bflat879 on December 19, 2011 at 12:37 PM

On the question of earmarks and why the earmarkers can’t be identified, I’ll bet there are a bunch of Republicans doing these earmarks and it’s their pay for supporting this joke of a bill.

Although I hope the Senate goes Republican next time around, I hope that every one of the Republicans, who’s up for re-election, gets a challenge and they lose, there is no excuse for doing this stuff.

bflat879 on December 19, 2011 at 12:42 PM

The House is correct on this.

SouthernGent on December 19, 2011 at 12:11 PM

I think the Dems strategy is pretty transparent (more so than any aspect of the corrupt Obama administration). They plan to do this two-months at a time dance for political reasons.

If the payroll tax holiday is temporary, then let it expire. It is nothing but pure politics to demand tax increases on the wealthy at the same time they are demanding tax cuts which are ineffective and have virtually zero stimulus effect. After all, isn’t the Dems that constantly bleat about us all having to pay a little more to keep the entitlement programs running?

Happy Nomad on December 19, 2011 at 12:44 PM

I agree, this 2 month trash is just that, TRASH

- Then what in the world was Boehner thinking when he verbally supported this measure?

- Why didn’t they tell McConnell that it would not pass and therefore not even bring it to a vote?

- Why did McConnell and most of the republican Senators vote for it!?

It was the same thing on the grand bargain, Boehner gets in a room with mcConnel and speak for the tea party, when they are NOT good representative of that group.

Just end up making the whole right (establishment and tea party) looking stupid, petty, immature and unorganized. Which at this point, I have a hard time proving otherwise.

Can.I.be.in.the.middle on December 19, 2011 at 1:36 PM

The lunatic-left d-cRAT socialist -CONTROLLED senate under dingy harry reid is responsible for limiting the extension to just two months. When will spineless, gutless OBOZO demand that reid do as he and the GOP-controlled House wants ?

TeaPartyNation on December 19, 2011 at 1:44 PM

How about the Senate pass a freaking budget? Why isn’t this being shouted from the rooftops every single time we’re on the cusp of these CR’s expiring?

ButterflyDragon on December 19, 2011 at 1:55 PM

The troops work over Christmas and New Years. CAn’t we expect the politicos to do the same?

kens on December 19, 2011 at 1:55 PM

Republicans really need to watch their step on this one, it could backfire big time. I say take the Keystone XL pipeline victory and run with it at least for the time being.

RiCkY.D. on December 19, 2011 at 2:56 PM

Why are we allowing Obama to have 2 months to decide on the Keystone XL pipeline? Congress can just approve it in the payroll tax legislation. Then Obama can either sign it or veto it. If the signs it and then tries to change the approval by Executive Order… he can’t – Exec Orders can not over rule Congress.

Dasher on December 19, 2011 at 3:29 PM