Payroll tax cut spat returns to Capitol Hill
With just three weeks left before the deadline, House Republicans and Senate Democrats are already playing the blame game to position themselves if the two sides cannot reach an agreement to extend the payroll tax cut, unemployment insurance reforms and prevent a pay cut for doctors who treat Medicare patients through the end of the year.
Senate Democrats have said they are working on a back-up package in case the official conference committee fails though they have not said how the extension would be offset to cover the cost.
House Republicans are accusing Democrats of negotiating in bad faith and say that President Obama and Senate Democrats want to drag out this fight as long as possible to make the political point that Republicans are blocking a middle class tax cut while protecting the wealthy. One leading negotiator, Michigan Republican Rep. Dave Camp, reportedly even told House Speaker John Boehner that negotiations are similar to the failed supercommittee talks.
"We have significant concerns about whether Senate Democrats are really willing to step up and work with House Republicans on the payroll tax cut bill" Boehner told reporters this morning on Capitol Hill.
"One can only wonder why Senate Democrats are dragging their feet and not coming forward with a plan" Boehner said adding that it's "time for the Senate to come forward and put their plan on the table."
"Let's allow the conferees to finish their work, get this payroll tax cut extended for the rest of the year" agreed Senate Republican leader Mitch McConnell on the Senate floor. "That's what Republicans want. That's what the President says he wants. There's no reason we shouldn't be able to get this done. The democratic majority in the senate should be leading that effort, not rooting for its failure."
One House Republican leadership aide said for the negotiations to succeed, Senate Democrats are going to have to start proposing some offsets to pay for the package or start accepting some from the House-passed bill.
Those offsets include extending a freeze on federal worker's pay and charging higher income Medicare beneficiaries higher premiums. Offsets that Democrats adamantly oppose.
Many Democrats, especially on the House side, still think that the package should not be offset at all. Or, at the very least, that the cost should be covered by the wealthiest Americans.
"Once again, we feel like we are being held hostage" said Connecticut Rep. John Larson, who chairs the House Democratic Caucus. "Will this go up to the 29th of February when it absolutely has to be passed? This is something that, frankly, Democrats believe is an emergency and doesn't need a pay-for, but if you're going to pay for it, why not pay for it out of oil subsidies and the nation's wealthiest 1 percent?"
Montana Democratic Sen. Max Baucus earlier suggested that the Congress could be forced to do another short-term extension of the package at the end of the month, but House Republican leadership aides say that's not a realistic option given the trouble getting House Republicans to agree to a short-term deal at the end of last year.
Aides on both sides agree that it's not a sure thing at this point that any deal can be reached at all.
But as Republicans grew more pessimistic today, Baucus seemed to try to get talks back on track telling negotiators today that "we are going to pass this" and that "when we do it will be one supported by both political parties."
Rep. Camp said he appreciated Baucus' comments, but reminded conferees that "our time is short."
