House rejects Senate payroll tax cut plan

By Karoun Demirjian

Published Tuesday, Dec. 20, 2011 | 4:33 p.m.

Updated Tuesday, Dec. 20, 2011 | 10:20 p.m.

WASHINGTON—Unemployed? Living paycheck-to-paycheck? Brace yourself, because the 112th Congress is at its worst impasse yet, and unless either Democrats or Republicans have some sort of come-to-Jesus moment over the Christmas holiday, payroll tax breaks and unemployment benefits are going to be lost in the logjam.

Republicans in the House of Representatives rejected the Senate’s two-month compromise to extend payroll tax cuts, unemployment benefits and guarantee Medicare and Medicaid providers a fair reimbursement rate today, voting instead to appoint eight members to conference with the Senate by a vote of 229 to 193.

But Senate and House Democrats, President Barack Obama, and many Senate Republicans -- including Nevada Sen. Dean Heller -- say there’s no time or reason to drag out the procedural process, not when there’s a bill out there that 89 lawmakers in the Senate have already agreed to.

“House Republicans are trying to sentence this middle-class tax cut to death by committee,” Nevada Rep. Shelley Berkley, a Democrat, said on the House floor this afternoon. “Washington Republicans had no problem passing taxpayer giveaways to Big Oil companies making record profits. They had no problem passing tax breaks for corporations that ship jobs overseas ... but when it comes to tax cuts to middle class families they say no, no we can’t do this, we have to send it back to another committee: conference, let’s kill it.”

Berkley is making a bid for the Senate in 2012 against Heller, who has occupied the seat since John Ensign stepped down amid scandal this year. Berkley and Heller don’t often agree on policy, but on the payroll tax cut compromise, they are both pointing an accusing finger at House Republicans.

“What is playing out in Washington, D.C., this week is about political leverage, not about what's good for the American people,” Heller said in a statement Monday. “Congress can work out a solution without stopping the payroll tax cut extension for the middle class, jeopardizing seniors’ access to health care, or threatening unemployment insurance.”

But Nevada’s Republican members of the House have a different interpretation: They say this is about upholding the processes of Congress, and about the House not bending to the big Senate bully across the building.

“We have regular order,” Nevada Rep. Joe Heck said. “When each house passes a bill that’s different, you go to conference and negotiate a compromise.”

“I think our work on the bill is entitled to every bit as much respect as the Senate’s, and the fact that the Senate doesn’t think it is is not my problem,” Nevada Rep. Mark Amodei said, adding that he expected to be back in Washington the week after Christmas. “What is the magic of the 60 days?”

Conference committees are often the way House and Senate lawmakers resolve differences between similar pieces of legislation. But they aren’t always or even often used, and when they are, their proceedings are in private -- as such, they are an unfamiliar part of the process to most people, even those regularly glued to C-SPAN.

Even if it were a more familiar item, the public’s been soured on special committees lately, thanks to the recent failure of Reid’s “super committee” to get anything done on debt reduction.

House Republicans have been arguing that Nevadans dependent on unemployment checks deserve the security of knowing the program will be around for a year, and small businesses can’t implement a two-month patch to extend unemployment benefits and decreased payroll taxes through February.

“You can’t do patchwork in two-month increments,” Heck said. “That’s been the problem with this...it basically pulls the rug out from underneath Nevadans.”

This morning, the U.S. Treasury refuted the claims that it would be too difficult to process a short-term change to the tax code, calling the prospect “feasible.”

While most lawmakers have expressed a preference for a one-year solution, it has eluded negotiators in the Senate, where a strong bipartisan majority decided that the security of the present moment trumps the security of planning for the long-term.

“It is unconscionable that Speaker Boehner is blocking a bipartisan compromise that would protect middle-class families from the tax hike looming on January 1st – a compromise that Senator McConnell and I negotiated at Speaker Boehner’s own request,” Reid said. “Speaker Boehner won’t let the House hold an up-or-down vote on the Senate’s bipartisan compromise because he knows it would pass.”

Democrats pointed out Tuesday that the majority of the conferees Boehner appointed Tuesday have spoken dismissively about payroll tax cuts in the past, adding more fuel to their open speculation that the focus on a conference committee process is a House "Republican ploy" to kill the bill.

Republicans shot back Tuesday that Democrats just don't want to accept the proposals Republicans are making to pay for the additional extension. Democrats wanted to pay for the extended payroll tax cuts and unemployment benefits with a surtax on million-plus incomes; Republicans want to add a rollback of industrial boiler regulations and limitations on unemployment eligibility (a proposal they argue came from Obama) to pay for their preferred year-long package.

In the midst of the sniping, there are consequences at stake that hit close to home.

The impact of unemployment checks and payroll taxes are felt by by every active and jobless worker in Nevada on a weekly or bi-weekly basis; if the program ends on January 1, 1.2 million Nevada workers would see their paychecks start to shrink immediately, and over 28,000 Nevadans would see their unemployment benefits end prematurely over the first seven weeks of the New Year.

“Let’s be clear: Right now, the bipartisan compromise that was reached on Saturday is the only viable way to prevent a tax hike on January 1st,” President Barack Obama said Tuesday. “The clock is ticking; time is running out.”

There are 11 days left in the calendar year. But if you ask a House Republican, that's 11 days to come up with a longer-term plan that everyone says they want anyway.

“There’s a wholesale disregard of a reasonable time frame that everybody’s on the record saying they want,” Amodei said. “Eleven days is a long time in political terms.”