Congress Moves Toward Standoff Over Payroll Tax

Partisan to the core, Congress careened toward a holiday-season standoff Monday on legislation to prevent a Social Security payroll tax increase for 160 million workers on Jan. 1.

"It's time to stop the nonsense. We can resolve these differences and we can do it in a way that provides certainty for job creators and others," said Speaker John Boehner, R-Ohio. He said the House would reject a bipartisan two-month extension that cleared the Senate over the weekend and seek negotiations on a bill to renew the cuts through 2012.

In an acid response, Senate Majority Leader Harry Reid accused Boehner of risking a tax increase for millions "just because a few angry tea partyers raised their voices." The Nevada Democrat ruled out new negotiations until the two-month measure is enacted.

That left the two parties approaching Christmas-week gridlock over an effort to pass core elements of President Barack Obama's jobs program - renewal of the tax cuts and long-term unemployment benefits - that Republican and Democratic leaders alike said they favored.

It was the latest and likely the last such partisan confrontation in a year of divided government that brought the Treasury to the brink of a first-ever default last summer, and more than once pushed the vast federal establishment to the edge of a partial shutdown.

This time, unlike the others, Republican divisions were prominently on display.

The two-month measure that cleared the Senate, 89-10, on Saturday had the full support of the GOP leader, Sen. Mitch McConnell, who also told reporters he was optimistic the House would sign on. Senate negotiators had tried to agree on a compromise to cover a full year, but were unable to come up with enough savings to offset the cost and prevent deficits from rising.

The two-month extension was a fallback, and officials say that when McConnell personally informed Boehner and House Majority Leader Eric Cantor of the deal at a private meeting, they said they would check with their rank and file.

But on Saturday, restive House conservatives made clear during a telephone conference call that they were unhappy with the measure.

Not surprisingly, the White House weighed in on the side of Obama's Democratic allies.

Spokesman Jay Carney said Boehner was for the two-month stopgap bill "before he was against it" - a claim that the House speaker flatly denied.

Speaking to reporters at the White House, Carney added, `'It is not our job to negotiate between him and Senate Republicans."

McConnell's office did not immediately respond to a request for comment.

"We are witnessing the concluding convulsion of confrontation and obstruction in the most unproductive, tea party-dominated partisan session of the Congress in which I have participated," said Rep. Steny Hoyer of Maryland, second-ranking member of the Democratic leadership.

Ironically, until the House rank and file revolted, it appeared that Republicans had outmaneuvered Obama on one point.

The two-month measure that cleared the Senate required him to decide within 60 days to allow construction on a proposed oil pipeline that promises thousands of construction jobs. Obama had threatened to veto legislation that included the requirement, then did an about face.

The president recently announced he was delaying a decision on the pipeline until after the 2012 elections, meaning that while seeking a new term, he would not have to choose between disappointing environmentalists who oppose the project and blue collar unions that support it.

The provision relating to the Keystone XL pipeline first surfaced in the House, where Boehner and the leaders had used it as an incentive to persuade conservatives to approve an extension of the payroll tax cut that many claimed had failed to create jobs.

The Senate-passed bill, as well as one that cleared the House last week, also would avert a threatened 27 percent cut in payments to doctors who treat Medicare patients.

There was no controversy on that provision, or much of one on anything but the duration of an extension.

Democrats gleefully distributed evidence of GOP disagreement, including comments from Sen. Scott Brown of Massachusetts, Richard Lugar of Indiana and others urging the House to approve the two-month measure.

But first-term House Republicans were unmoved.

"What they (the Senate) sent us over was an insult to the American people," said Rep. Ann Marie Buerkle, R-N.Y.

"I don't care about political implications" of letting taxes go up Jan. 1 for 160 million Americans, said Rep. Tom Reed, R-N.Y. "We will stay here as long as it takes in order to do what's right for the American people. That means working on Christmas, New Year's and other days. It's time to get the job done."

Professing a lack of concern about higher taxes was not a widely held position inside the party leadership, though. For both parties, the political implications seemed to matter hugely.

The Democratic Congressional Campaign Committee announced it was sending automated phone calls into households in 20 targeted GOP-held districts demanding that lawmakers support the two-month extension, lest taxes go up.

Not to be outdone, the National Republican Congressional Committee issued a statement headlined "Vacation, All House Dems Ever Wanted" and claiming that Democrats wanted to raise taxes on the middle class.

It was unclear how much attention the political maneuvering would draw in a nation where consumers were in the final shopping countdown toward Christmas and the next national election was nearly a year away.