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Congress locked in stare-down over payroll tax cut extension

 

After House Republicans over the weekend walked away from a tentative agreement to extend the payroll tax cut, Congress found itself locked in on a staring contest on Monday -- to see who would blink first.

The House is expected to vote Monday evening to reject legislation passed last week by the Senate to extend the expiring payroll tax cut for two months. That sets up the risk that, if no deal is reached by Dec. 31, taxes will go up on Jan. 1.

House Speaker John Boehner (R-OH), speaking Monday morning at the Capitol, said that Republicans thought the two-month extension didn't provide enough certainty to the economy. 

"Americans are tired of Washington's short-term fixes and gimmicks, which is creating uncertainty for job creators in a time when millions of Americans are out of work," he said in a brief statement.

The speaker suggested that, instead, Republicans would vote to send their own year-long tax cut extension to conference, the formal process by which the House and Senate are supposed to resolve the differences between their bills. That process has been a relative rarity in this Congress, since most major agreements have been worked out typically through outside, technically informal talks. 

"I expect that the House will disagree with the Senate amendment and instead vote to formally go to conference, the formal process of which the House and Senate can resolve our differences between our two chambers and our two bills," Boehner said.

That move is a bid to shift political blame to the Democrats who control the Senate. The upper chamber adjourned until Jan. 23, reflecting their expectation that passing the two-month extension, which was approved with bipartisan support in the Senate, was all but a mere formality in the House.

Boehner had sought to sell the deal to rank-and-file members during a weekend conference call, according to Republicans familiar with the call, but was met by blowback from some conservative members. Some of those members flatly oppose extending the tax cut, while others are concerned that extending the tax cut for only two months would leave the GOP politically vulnerable, especially to criticism by President Obama during next month's State of the Union Address.

"I think it's time for Senate Democrat leaders to follow the president's example, put their vacations on hold, and work in a bipartisan manner to finish the nation's business," Boehner said.

If the House approves the conference report, it would mean that Democrats would be left with a choice between coming back to Washington, or standing by their existing deal, essentially telling the House GOP to take it or leave it.

"Speaker Boehner has two choices and only two. The first is to pass the bill, the bipartisan bill that the Senate passed 89 to 10," Sen. Charles Schumer (D-NY), the Senate Democratic messaging chief, said Monday on MSNBC's Morning Joe. "The second is the middle class tax cut will lapse, and he will be responsible."

There are legislative pressure relief valves still available to Congress. One would involve leaders reaching an agreement on an item to pass the House, which would then be approved by unanimous consent -- a procedural move to pass a law without a formal vote, so long as no member objects.

For Congress, the year-end gridlock is a familiar theme. Lawmakers struggled to reach a deal to extend the expiring Bush tax cuts last December. (The deal they reached included the one year payroll tax cut -- the break that now Obama and Democrats have pushed to extend.) The year before, the Senate voted Christmas Eve to approve the president's health reform law.

But the stalling this week is also familiar because of its internal discord in the House. Boehner seemed to have balked because of the fractious House GOP majority, which is divided to an extent between an old guard with experience on Capitol Hill and the more tenacious, Tea Party-tinged freshman class elected just last fall.

Democrats have taken note of those divisions, and how it's affected their ability to negotiate with Boehner.

"Trying to negotiate with Speaker Boehner is like trying to nail Jell-O to the wall," Schumer said this morning.

Rep. Connie Mack, R-Fla., reacts to the House GOP's rejection of the payroll deal