House Republicans blocked the Senate’s two-month extension of the payroll tax cut and emergency unemployment benefits on Tuesday, setting up a confrontation between the two chambers.
Speaker of the House John Boehner, R-Ohio, said the members of his caucus opposed the short-term extension. He wants the House and the Senate to set up a conference committee to resolve the differences between the Senate bill and a bill with a yearlong extension passed by the House last week (see House Action Uncertain on 2-Month Payroll Tax Cut). Over the weekend, Senate Republicans and Democrats negotiated and passed a two-month extension of this year’s 2-percentage-point cut in Social Security and Medicare withholding taxes, along with unemployment benefits and the so-called “doc fix” to prevent Medicare reimbursement rates for physicians from plunging.
Boehner and House Majority Leader Eric Cantor, R-Va., cited a letter from the National Payroll Reporting Consortium, in which they said a two-month extension of the payroll tax cut would be unworkable. However, Democrats contend that the two-month extension is only a stopgap measure to give the two parties extra time to negotiate on ways to pay for a full-year extension. Boehner argued that Senate leaders should return from their holiday breaks and appoint members of a conference committee to agree on a 12-month extension before the end of the year.
“We oppose the Senate bill because doing a two-month extension instead of a full year extension causes uncertainty for job creators,” he said Monday. “I used to run a small business, I met a payroll, I hired workers. A two-month extension creates uncertainty and will cause problems for people who are trying to create jobs in the private sector. The idea that tax policy can be done two months at a time is the kind of activity that we see here in Washington that’s really put our economy off its tracks.”
Democrats accused House Republicans of avoiding a vote on the bipartisan Senate bill, which was approved by a vote of 89-10. “This is a dishonest procedure,” said House Ways and Means Committee ranking member Sander Levin, R-Mich. “It is a ruse to avoid a straight up or down vote on the Senate bill and the two-month extension. Why not hold a straight vote, as indeed called for under regular order? That’s the regular order. Because the Republican majority is afraid of a straight vote. They are afraid that some Republicans would vote yes and the Senate bill would pass and the President would sign it and it would become law today. They don’t want Republicans on record voting against a payroll tax cut. That is the epitome of a ruse. Thirty-nine Republican senators—all but a handful—voted for the bill.”
President Obama urged House Republicans to pass the two-month extension in the Senate bill. “Nearly the entire Senate—including almost all of the Republicans—voted to prevent 160 million working Americans from receiving a tax increase on January 1st,” he said. “Nearly the entire Senate voted to make sure that nearly 2.5 million Americans who are out there looking for a job don’t lose their unemployment insurance in the first two months of next year. And just about everybody—Democrats and Republicans—committed to making sure that early next year we find a way to extend the payroll tax cut and unemployment insurance through the end of 2012. But now, even though Republicans and Democrats in the Senate were willing to compromise for the good of the country, a faction of Republicans in the House are refusing to even vote on the Senate bill—a bill that cuts taxes for 160 million Americans. And because of their refusal to cooperate, all those Americans could face a tax hike in just 11 days, and millions of Americans who are out there looking for work could find their unemployment insurance expired.”
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