Senate Leaders
Agree on 2-Month Extension of Payroll Tax Cut
Published: December 16, 2011 - New York Times
WASHINGTON — Senate leaders said on Friday night that they had reached a deal
that would extend a payroll tax cut for two months — falling far short of the
yearlong extension they had been seeking. The agreement would also speed the
decision process for the construction of an oil pipeline from Canada to the
Gulf Coast, a provision necessary to win over Republicans who opposed the tax
break.
A senior administration officials said the deal announced Friday night
met the test that President Obama had set out: that Congress would not go home
without preventing a tax increase on 160 million Americans.
However, rank-and-file members of the House said on Friday that they were
opposed to a short-term extension. Approval in that chamber, even with the
provision on the Keystone
XL pipeline, is no sure thing.
The agreement, on which a Senate vote is expected Saturday, would also allow
jobless workers to continue receiving unemployment insurance benefits as
permitted by current law for two months. For the same period, there would be no
cut or increase in fees paid to doctors for treating Medicare
patients. The cost of these items will be fully paid for, Congressional aides
said.
Administration officials indicated that Mr. Obama would not veto the
legislation even though the Keystone XL pipeline provision remained in the bill.
They said they believed that the president could still delay the pipeline until
environmental stipulations were met. gThis provision does not mandate it,h the
administration official said, git simply speeds up the review process for a
decision.h
Nonetheless, environmental advocates were unhappy. gWefre stunned that the
president would say one week that hefs going to veto any provision that includes
Keystone, and then cave the next week,h said Bill McKibben, founder of 350.org, an environmental group
opposed to the pipeline. gWhere I come from, people donft do that, but I guess
this is Washington.h
News of the deal came as the 112th Congress lurched toward the end of its
tumultuous first session. Earlier on Friday, the House finished off one of its
last major pieces of business for the year, voting 296 to 121 to approve a
sweeping $1 trillion spending bill that would keep the government funded through
Sept. 30. The Senate is set to approve it Saturday.
But even as House members raced for the airports, they knew that they might
have to return next week to deal with extending the 2 percentage-point cut in
the Social
Security payroll tax. If Congress does nothing, the rate will revert to 6.2
percent in January.
As wrangling over the tax has continued, Republican leaders have sought to
build support for the measure by adding conservative policy provisions, which
have replaced earmarks as the legislative sweetener for Republican lawmakers in
a Congress where fundamental differences about the role of government in
American life deeply divide the parties.
That conflict, which mirrors the broader political dynamic across the
country, is unlikely to ebb in the second session, as Republicans labor to make
life more difficult for President Obama and Democrats struggle to hold the White
House and the Senate.
gItfs a presidential year and it may even get worse,h said Representative
Jeff Fortenberry of Nebraska, a Republican who has served since 2005. gMy hope
is that the institution can regain some stature in the eyes of the people,h he
said. gSadly next year, because of the dynamics of politics, because of the
dynamic of the media because of the dynamics of money, itfs likely to be more
difficult.h
Senator Harry Reid, the Democratic leader, pledged Friday night to continue
to push for a full-year extension of the payroll tax cut and to paint
Republicans as favoring a tax increase for the middle class.
The omnibus spending bill approved by the House on Friday provides more than
$900 billion for the Defense Department, Homeland Security, public works,
foreign aid, veterans benefits and a wide range of health, education and labor
programs in the 2012 fiscal year.
House and Senate negotiators resolved their last dispute by eliminating
proposals restricting Cuban-Americansf travel to their homeland. The White House
took a firm stand against the restrictions, saying Congress should not legislate
foreign policy in a spending bill.
For the regular operations of the Defense Department, Congress provided $518
billion, an increase of $5 billion over last yearfs level. For the wars in Iraq
and Afghanistan, it provided $115 billion, down from $158 billion last year.
Military personnel would receive a 1.6 percent pay raise.
The bill would provide $1.8 billion, the same as last year, for renewable
energy technology. But it would end the program that guaranteed a loan for
Solyndra, the failed solar equipment company.
The bill would require federal agencies to conduct a cost-benefit analysis of
proposed federal guidelines for the marketing of food to children.
Margo G. Wootan, director of nutrition policy at the Center for Science in
the Public Interest, a research and advocacy group, said, gThis will not kill,
but will delay, the guidelines, which are awaiting final approval at the White
House.h
The bill stipulates that no federal money can be used to gimplement or
enforceh new energy efficiency standards for light bulbs. Republicans said the
government had no business telling people what sort of light bulbs they could
use.
The bill would prohibit the District of Columbia from using federal or local
tax money to pay for abortions for low-income women under Medicaid.
Under the bill, the National Institutes of Health would get $30.7 billion,
which is $299 million above last yearfs level and $758 million below the
presidentfs request.
The bill provides $3.5 billion for the Low Income Home Energy Assistance
Program — $1.2 billion less than last year but $909 million more than the
president requested.
The measure also cuts President Obamafs Race to the Top education initiative
by more than 20 percent, to $550 million, from $698 million. The bill says
health officials cannot use federal money to advocate gun control or to carry
out needle exchange programs, intended to curb the spread of AIDS.
Helene Cooper contributed reporting.