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Payroll Tax Cut Legislation Gets Vote Today

The House will vote on their payroll tax cut bill today, legislation loaded with ideological measures and poison pills.  It’s legislation Harry Reid, the Senate Majority Leader, has already said cannot pass the upper chamber. Like so many times before, the House believes that they can pass message legislation as long as it contains something Democrats want and gain the advantage on the final product. This has had mixed results, but it obviously fits with John Boehner’s legislative philosophy.

Boehner predicted the House will approve the roughly $180 billion package, which according to the Congressional Budget Office increases the deficit by $25 billion within the 10-year budget window. He must have added enough ideological measures to entice his fellow conservatives. Most Democrats are expected to vote against the bill, aside from a few wayward conservative members like Dan Boren (D-OK). It’s possible Boehner has not lined up the votes he thinks he has, but I cannot imagine he’s that incompetent at vote-counting on such critical legislation. Nevertheless, he has proven me wrong before, particularly on vote-counting.

The bill extends three big measures – the payroll tax cut, extended unemployment insurance and a patch on Medicare reimbursement to sustain it at slightly above current levels (a 1% increase, in fact) for two years. The extended unemployment benefits are actually gradually cut back over the next six months, from 99 to 59 weeks, in the legislation. It  partially offsets the costs in a variety of ways, including means testing of Medicare, unemployment benefits and food stamps, cuts to Affordable Care Act funds, a federal pay freeze, and sale of wireless spectrum. There are also some unrelated riders included that have nothing to do with cost, including a rollback of an EPA rule on industrial boilers and a statutory demand that the President make a decision on permitting the Keystone XL pipeline within 60 days.

On the latter, the State Department has already handed down the answer, defusing that poison pill somewhat. In a statement, the State Department wrote that “Should Congress impose an arbitrary deadline for the permit decision … the Department would be unable to make a determination to issue a permit for this project.” The President would have to write a letter explaining why the deal wasn’t in the national interest, in that case, but the effect of the House passing the bill would be to deny the permit, which I think is the opposite of what they want.

A couple elements of this make me slightly more optimistic than before that a compromise will be reached. First of all, the vote is coming on Tuesday, before several other must-pass pieces of legislation, including the omnibus package to fund the government, get a vote. That means that the House will not try to jam the Senate, passing the bill and leaving town. This theoretically leaves room for negotiation. So did Boehner in remarks yesterday:

Boehner, R-Ohio, sidestepped a question about whether he rules out eventually agreeing to a compromise with that chamber.

“The House is going to do its job, in time for the Senate then to do its job,” Boehner told reporters.

The Senate, however, will not “do its job” in the sense of passing this legislation, Boehner and Mitch McConnell’s preferred plan. And we’re at Tuesday when both chambers are scheduled to adjourn Friday, and no meaningful dialogue has been had between the parties on the legislation. Most of the debate has played out in the media.

The challenge comes when the Senate votes down the bill. What happens then? Stay tuned.

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David Dayen

David Dayen