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House Rejects Senate's Extension Of Payroll Tax Cut

Dec 20, 2011
Originally published on December 20, 2011 2:23 pm

Update at 12:56 p.m. ET. House Rejects Bill:

Voting mostly along party lines, the U.S. House of Representatives voted to send a Senate bill extending unemployment benefits and a payroll tax cut to conference. With the Senate in recess, the move leaves the bill in limbo and could mean that come January, 2 million Americans will lose their long-term unemployment benefits and 160 million workers could see their taxes rise by 2-percentage points.

Before the vote, Democrats and Republicans went head to head on the House floor.

Republicans argued that the two-month extension of benefits was a "band-aid" and created more uncertainty in the country. Democrats accused Republicans of throwing a "legislative tantrum."

Rep. Diane Black, a Republican from Tennessee, said lawmakers should stay in Washington through the holidays to pass a year-long extension instead of a two-month "band-aid."

Rep. Richard Neal, a Democrat from Massachusetts, said the bill had been brought to a halt by the Tea Party, which he called "a radical element [that] has taken over the Republican party."

"They are courting disaster," said Neal.

Update at 1:12 p.m. ET. Final Vote Count:

The final vote came at 229-193. Seven Republicans voted against their party. What's next? It is up to the Senate to take action, but Senate Majority Leader Harry Reid, D-Nev, has said he will not call the Senate back to Washington to conference on the bill.

House Speaker John Boehner said there is no question that everyone wants extend these benefits but the Senate — which passed the motion with a rare bi-partisan 89-10 vote — wants to "kick the can down the road" and settle it two months from now.

Boehner called on the Senate to "come back to town," to conference on the bill and extend it for a full year to give the American people a bigger "Christmas gift."

Rep. Steve Israel, a Democrat from New York, followed Boehner on the House floor and said this move was nothing but a "partisan middle-class mugging."

As the AP reports, the central issue here is that House Republicans aren't happy with the version of the bill it received from Congress. The AP explains:

"The Senate's short-term, lowest-common-denominator approach would renew a 2 percentage point cut in the Social Security payroll tax, plus jobless benefits averaging about $300 a week for the long-term unemployed, and would prevent a 27 percent cut in Medicare payments to doctors.

"The House passed a full-year extension last week, containing many spending cuts opposed by Democrats.

"House Republicans, however, have erupted in frustration at the Senate measure, which drops changes to the unemployment insurance system pressed by conservatives, along with cuts to President Barack Obama's health care law."

Update at 2:10 p.m. ET. Put Politics Aside, Obama Says; Vote On The Bill:

President Obama just appeared in the White House briefing room to say that House Republicans should "put politics aside" and cast a yeah-or-nay vote on the Senate-passed plan to extend the payroll tax cut for another two months — rather than effectively rejecting it on the grounds that the extension needs to be for a full year. "The American people are weary" of political bickering, the president said.

Update at 2:22 p.m. ET. Boehner Says It's Up To Obama Now:

"President Obama needs to call on Senate Democrats to go back into session" and join House negotiators in a conference committee to hammer out an agreement, House Speaker John Boehner (R-Ohio) just told reporters. "It's up to the president to show real leadership," he added.

Our Original Post:

Rather than holding a straight up-or-down vote on the Senate-approved package to extend payroll tax cuts and long-term unemployment benefits for another two months — a package they oppose — House Republicans now plan to effectively reject the measure without having to cast "no" votes.

As The Hill explains:

"House Republicans are setting up a vote on whether to go to a conference with the Senate. They say a vote to go to a conference with the Senate would serve as a vote against the Senate bill. Critically, however, it would be expressed as a vote in favor of going to the conference, and not a vote against cutting the payroll tax."

Or, as Politico says, "House Republicans postponed a planned Monday night vote on the Senate-passed payroll tax cut bill, bowing to pressure from rank-and-file lawmakers to fight the battle in a fresh media cycle, avoid a dark-of-night vote and, perhaps most important, find a way to reject the Senate bill without voting directly against a tax cut."

The vote is expected to happen around midday.

As Speaker John Boehner (R-Ohio) has been saying in recent days, Republicans in the House (which they control) want the extensions to be for a full year, not two months. They don't want to just "kick the can" down the road, he says.

Getting any extension done before the payroll tax cut and long-term jobless benefits expire on Dec. 31, however, may prove impossible. The Democratic-controlled Senate has adjourned for the holidays. And Majority Leader Harry Reid (D-Nev.) has said his chamber won't negotiate with the House unless the short-term, two-month extensions are passed first.

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