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

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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