Obama Urges Hill Leaders to Extend Payroll Tax Cut

By: Associated Press Email
By: Associated Press Email
Seeking to break a stalemate that is threatening 160 million workers with Jan. 1 tax increases, President Barack Obama urged the top leaders of Congress Wednesday to first pass a short-term extension while promising to work with lawmakers on a full-year measure.

House Speaker John Boehner of Ohio walks of the floor of the House chamber on Tuesday, Dec. 20, 2011, in Washington. The House rejected legislation to extend a payroll tax cut and jobless benefits for two months, drawing a swift rebuke from President Barack Obama that Republicans were threatening higher taxes on 160 million workers on Jan. 1. (AP Photo/Evan Vucci)

WASHINGTON (AP) - Seeking to break a stalemate that is threatening 160 million workers with Jan. 1 tax increases, President Barack Obama urged the top leaders of Congress Wednesday to first pass a short-term extension while promising to work with lawmakers on a full-year measure.

Obama's calls to House Speaker John Boehner, R-Ohio, and Senate
Majority Leader Harry Reid, D-Nev., came as the two leaders were
trapped in a deadlock over competing demands.

The White House said Obama told Boehner that "the short-term bipartisan compromise passed by almost the entire Senate is the only option to ensure that middle class families aren't hit with a tax hike in 10 days and gives both sides the time needed to work out a full year solution."

Earlier, Reid wrote Boehner to urge him to bring House lawmakers back to Washington and approve a bipartisan measure the Senate
approved overwhelmingly last weekend. That bill would extend the payroll tax cut and jobless benefits for two months, giving bargainers time to agree to a more expensive, yearlong measure.

"Because we have a responsibility to assure middle-class families that their taxes will not go up while we work out our differences, we must pass this immediate extension first," Reid wrote.

Minutes later, Boehner and other top House Republicans invited reporters into a meeting where they urged Reid to bring senators back to town so they can negotiate over a yearlong extension of the tax cut and jobless benefits. The bill would also postpone a scheduled Jan. 1 cut of 27 percent in payments to doctors who treat Medicare patients.

"All we're asking for is to get Senate members over here to work with us to resolve our differences so we can do what everybody wants to," Boehner said.

Aides to Boehner and Reid couldn't say whether Boehner and Reid have actually spoken in the past week. "As always, we keep the lines of communication open," said Boehner spokesman Michael Steel.

President Barack Obama and leaders of both parties want to extend the tax cuts and jobless benefits and prevent the cut in doctors' reimbursements for an entire year. Most lawmakers have left Washington for the Christmas and New Year's holiday, but could quickly return to vote on any agreement.

The back and forth underscored a pressure-packed partisan fight, being waged on the eve of a presidential and congressional election
year, in which neither side is showing any indication of give.

In a moment of political theater, Democrats tried to get the House to consider the two-month extension of the payroll tax cut as the chamber convened for a ceremonial session at which no formal business was scheduled. But acting speaker Rep. Michael Fitzpatrick, R-Pa., adjourned the chamber and walked out.

"Mr. Speaker, you're walking out. You're walking away just as so many Republicans have walked away from middle-class taxpayers" and others, Rep. Steny Hoyer of Maryland, the No. 2 House Democrat, shouted to an empty chair where the House presiding officer sits.

Republicans also came under pressure from their own usual allies when an opinion article on the Wall Street Journal's conservative editorial page accused the GOP of botching the fight over the payroll tax cut.

"Republicans would do best to cut their losses and find a way to extend the payroll holiday quickly," the editors wrote.

On Tuesday, the House voted 229-193 to kill the Senate measure. Afterward, Obama signaled he'll use his presidential megaphone to
try to force Republicans controlling the House into submission.

"Now let's be clear," Obama said at the White House. "The bipartisan compromise that was reached on Saturday is the only viable way to prevent a tax hike on Jan. 1. The only one."

The Obama campaign promptly took to Twitter and Facebook to fight it out. With their candidate's poll numbers rising, Democratic operatives seemed almost giddy at the prospect of a prolonged battle.

"They should realize that they're just in a cul-de-sac. They're at the end of the rope. And they ought to just pass our Democratic-Republican compromise and we can negotiate for the rest of the year," said Sen. Charles Schumer, D-N.Y.

Republican lawmakers relished the battle as well, though some of them are too inexperienced to know that presidents - regardless of
party - usually win such high-profile fights, like Bill Clinton did over a 1995-96 government shutdown or George W. Bush did in skirmishes on anti-terror policies.

House Republicans instead rallied around a plan passed last week
that would have extended the payroll tax cut for one year. But that version also contained spending cuts opposed by Democrats and
tighter rules for jobless benefits.

If legislation isn't passed by New Year's Day, payroll taxes will go up by almost $20 a week for a worker making a $50,000 salary. Almost 2 million people could lose unemployment benefits as well, and doctors would bear big cuts in Medicare payments.

Given Obama's remarks and Reid's refusal to negotiate, it was unclear what leverage Republicans had in the year-end standoff. It
appeared likely the partisan disagreement could easily persist past
Christmas and into the final week of the year.


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