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Unanswered Questions of the Tax Cut Deal

That cloture vote is still open at the moment, but the Senate will move to advance the health care bill today. They already have close to 70 votes in favor. With that kind of support, passage is assured. But while there’s no question of that, other questions abound:

Will the Senate allow amendments? As I mentioned earlier, Sens. Sherrod Brown and Olympia Snowe offered an amendment on currency reform. Other amendments have been filed, including one to fix the 1099 provisions in the health care law, which Republicans summarily nixed. Basically they want Democrats to suffer from having passed a bill with that measure, which is onerous on small businesses, and they refuse to fix it.

Basically, Republicans opposed almost any add-ons to the bill, so I’d expect something clean, with perhaps no amendments before another cloture vote (to end debate) and final passage.

• What will the House do? We’ve seen some conflicting reports on this. Chris Van Hollen said that his party wanted to change the estate tax provision but that the bill would eventually pass; then he went back on that, saying that “In its current form it is not acceptable to the Democratic caucus.”

What would make it acceptable? There was some thought that extending certain renewable energy grants from the stimulus would be enough, but Jay Inslee rejected that, calling it “a pathetic attempt.” Indeed, Peter Welch, who has led opposition in the House, believes adding new sweeteners “erodes support and feeds public cynicism.” So any additional inducement could be counter-productive to a certain segment of the caucus.

There’s a possibility that extending the popular Build America Bonds program, which allows cities and states to borrow at low rates for infrastructure projects, may be enough to tip a certain amount of Democrats needed for passage. But it’s possible that such support isn’t needed, and that the votes are already there in the House.

What will Pelosi do? The outgoing House Speaker has tried to walk a tightrope on this bill, reflecting the intentions of her caucus while not signaling that the bill will die in her chamber. She has to find a way out of this, too, and “re-negotiating” the bill seems like the only way out. I put that in quotes because I mean by “re-negotiating” that the bill stays virtually the same, but with a few well-placed changes that Pelosi can use with her caucus. Just refusing to bring forward the bill doesn’t seem like an option for her, though in order to drive a re-negotiation she has to put it out there.

How long will this take? If those opposed to the bill really wanted to, they could drag out final passage in the Senate until at least Friday, leaving little time for passage in the House. There are of course a number of other bills the Democrats want to get to in the lame duck, including a continuing resolution to fund the government, the DREAM Act, a standalone legislative repeal of Don’t Ask Don’t Tell and the new START treaty. But initially, December 17, this Friday, was set as the last day of the session. It looks like that won’t happen now.

Senate leaders from both parties just indicated that they expect Senate business to go beyond this Friday — which was the expected get-away date for the holidays.

Senate Majority Leader Harry Reid said they must finish pending business, which includes the tax-cuts package, funding government operations, and possibly ratification of New START.

White House press secretary Robert Gibbs would not call for the Senate to stay in session particularly to pass the standalone DADT repeal. But the Senate has virtually no choice but to stay longer to finish pending business.

In conclusion, with members of both parties coalescing around the bill, and pointing to poll support as well, it seems clear that a tax cut deal with the broad outlines of this one will pass. But there are still a bunch of things up in the air.

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David Dayen

David Dayen