One promising sign of President Obama’s meeting with congressional leaders Tuesday was that he didn’t emerge with his lip bleeding from a fresh elbow jab in the face.
Instead, he talked of “common ground” and Republican leaders acknowledged that the meeting was generally cordial, even as they chided Obama for not rolling out the welcome mat more often. He has now committed to holding more meetings with them in the future, including at Camp David.
But first they agreed to appoint a working group of two Democrats and two Republicans who will meet, along with Treasury Secretary Timothy Geithner and White House Office of Management and Budget director Jacob Lew, to forge some type of compromise on the Bush-era tax cuts (see Obama Meets with Congress on Bush Tax Cuts).
The Democrats named for the working group are Senate Finance Committee Chairman Max Baucus of Montana and Rep. Chris Van Hollen of Maryland, who will be chairing the House Budget Committee come next year. On the Republican side will be Sen. Jon Kyl of Arizona, the deputy minority leader, and Rep. Dave Camp of Michigan, who is expected to be the next chair of the tax-writing House Ways and Means Committee.
Whatever they end up producing, the most likely scenario appears to be some temporary extension of the Bush tax cuts for all income levels. House Minority Whip Eric Cantor, R-Va., said after the meeting that Republicans and some Democrats at the meeting opposed any “bifurcation.” That means the idea that has been floated in recent weeks of “decoupling” the tax cuts by providing “permanent” tax cuts for the middle class and “temporary” tax cuts for couples above the $250,000 income level is probably not going to be part of the ultimate compromise.
The main question that remains then will be how long the Bush tax rates will be extended, whether for one year, two years, three years or more. Hopefully we will know the answer by the time Congress leaves town for the holidays.
In the meantime, Van Hollen has said the House is likely to hold a vote this week on legislation to provide a tax cut extension for those making under $250,000 a year. But since the bill may be introduced under the so-called “rules of suspension,” which require a two-thirds supermajority for passage, the bill is not likely to get very far. If the bill is introduced under the regular rules, however, Republicans would have an opportunity to introduce an amendment for across-the-board tax cuts, which could attract enough Democratic votes to pass, at least in the House.
After Tuesday’s meeting, it is more likely, however. that lawmakers will be inclined to wait to see what proposal comes out of the six-man working group, which presumably will have the blessing of Democrats and Republicans from both the House and Senate, as well as the Obama administration, before they will feel they have enough political cover to support the ultimate tax cuts extension agreement.
Then the rush will be on to pass it, assuming the bipartisan spirit lasts long enough. And whether or not they get around to deciding what to do about the return of the estate tax, the long-overdue alternative minimum tax patch, the unemployment extension, and other pressing matters, is anybody’s guess. Whatever happens, it promises to be an especially busy lame-duck session.
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