Gingrich forgets GOP line on payroll taxes

As far as GOP presidential hopeful Newt Gingrich is concerned, congressional Republicans are probably going to have to give in and extend President Obama’s payroll tax break.

“I think it’s very hard not to keep the payroll tax cut in this economy,” Gingrich said in a presentation at the conservative Heritage Foundation. “I don’t know what Republicans are going to say but I think it’s very hard to say ‘no.’ We’re going to end up in a position where we’re gonna raise taxes on the lowest income Americans the day they go to work and make life harder for small businesses.”

He’s referring to a stimulative, two percent payroll tax holiday President Obama negotiated when he agreed to extend the Bush tax cuts in December. It’s set to expire at the end of the year, and it’s one of the economic growth proposals President Obama has called on Congress to pass when they return from August recess.

“I do think that it’s a serious challenge to not extend it,” Gingrich added.

Quick follow-up question for Newt: have you actually met any congressional Republicans lately?

Gingrich appears to be analyzing this situation in terms of what makes sense, and in general, that’s a perspective I enjoy. But some GOP leaders have already announced their opposition to Obama’s request for an extension of the tax break.

Republicans are going to find “it’s very hard to say ‘no'”? Actually, House Budget Committee Chairman Paul Ryan (R-Wis.), just last week, found it very easy to say no, telling Fox News a payroll tax cut extension “would simply exacerbate our debt problems.” House Ways and Means Committee Chairman Dave Camp (R-Wis.) has said of the idea, “I’m not in favor of that. I don’t think that’s a good idea.” A month ago, during the debt-ceiling negotiations, President Obama tried to incorporate the payroll break into the deal, and GOP leaders rejected it then, too.

Keep in mind, the payroll tax break has been, traditionally, a Republican idea. But now that President Obama is championing the idea, the same GOP officials who pushed for this tax cut are now opposed to their own measure.

As Sen. Chuck Schumer (D-N.Y.) recently argued, “If they oppose even something so suited to their tastes ideologically, it shows that they’re just opposing anything that helps create jobs. It almost makes you wonder if they aren’t trying to slow down the economic recovery for political gain.”

This is the whole point of the “sabotage” question. The argument isn’t that Republicans have conservative ideas about helping the economy. Questioning their motivations on this alone would be foolish. The point, rather, is that Republicans have begun rejecting their own ideas about helping the economy.

In the larger context, it’s possible House Republican leaders, in their heart of hearts, actually support an extension of the payroll tax cut, but just aren’t willing to say so. Why not? Because then they lose leverage — GOP officials know the White House wants this, and if they simply agree to pass the measure, they won’t get anything extra out of the deal.

It’s likely, then, that congressional Republicans will simply hold the payroll tax cut hostage, and demand other goodies from Democrats in exchange for doing what the GOP wants to do anyway. If Dems give in, Republicans get more of what they want. If Dems don’t, Republicans will blame Dems for raising middle-class taxes, even if it’s obviously the GOP’s fault.

And what kind of ransom would Republicans expect for this? Apparently, they want a tax break for repatriating overseas corporate funds, which didn’t work when it was tried seven years ago, which is fundamentally regressive, and which would worsen the deficit the GOP pretends to care about.

The 2010 midterms continue to look like the biggest mistake Americans have made in a long while.