Senate leaders struck a deal late yesterday for a two-month extension of the payroll tax break, which senators will probably approve later today. House passage will likely be a much heavier lift.
The key problem is pretty straightforward: Republicans have met a tax cut they simply don’t like.
Bloomberg TV’s Al Hunt sat down yesterday with Rep. Pete Sessions (R-Texas), the Chairman of the National Republican Congressional Committee, who called a payroll tax break a “horrible idea” in September. Hunt asked where Sessions currently stands. He replied:
“Well, I didn’t change my mind. It is a bad idea. But when you combine that with something else — for instance, when we voted the extension of the tax cuts — when you mirror that with something that’s a job stimulus, an economic growth package, then it’s a good deal. […]
“Now is the wrong time — now is the wrong time to have the American worker take home less pay.”
Part of the problem here is that Pete Sessions doesn’t understand tax policy (or even arithmetic) especially well. Look at that quote again — the Texas lawmaker doesn’t want American workers to take home less pay, which is why he thinks it’s a bad idea for American workers to take home less pay.
If I had to guess, I’d say Sessions was probably referring to the Democratic plan for a surtax on millionaires and billionaires — what else makes sense in this context? — though it’s worth noting that the surtax provision has already been dropped as part of the negotiations.
If this isn’t what he’s referring to, the Bloomberg transcript is accurate, and the congressman actually wants Americans workers to take home more and less pay at the same time, then I can only wonder whether Pete Sessions has suffered some kind of head trauma recently.
In either case, the key realization from this, Sessions’ limited intellect notwithstanding, is that many, if not most, House Republicans simply want this tax break to go away. They’ve heard the warning about the detrimental effect on the economy, and they simply don’t care.
The political world has come to accept a basic truism: the Republican Party is, above all else, an anti-tax party. GOP officials always want to cut taxes, regardless of merit or circumstances.
The maxim is incomplete — Republicans love tax cuts, but their affection is limited to cuts for the very wealthy. An extension of the payroll break largely benefits the middle class, and that immediately gives the GOP pause.
So what’s going to happen? One scenario to keep an eye on is a bipartisan majority — Republican leaders can corral enough GOP members to join House Democrats to get the package across the finish line. The other, perhaps more likely, scenario is that Boehner and Cantor get pushed around by their caucus again, add a bunch of right-wing sweeteners to the Senate version, and say they refuse to budge until Dems agree to the terms.
