The Republicans’ ‘payroll tax fiasco’

Sen. John McCain (R-Ariz.) told CNN yesterday that the fight over extending the payroll tax cut is “harming the Republican Party,” adding, “We’ve got to get this resolved and with the realization that the payroll-tax cut must remain in effect.”

The Wall Street Journal‘s editorial page, one of the most conservative pieces of media real estate in the country, went considerably further today, blasting the GOP’s “payroll tax fiasco,” and mocking Republicans for “managing to lose the tax issue” to President Obama.

GOP Senate leader Mitch McConnell famously said a year ago that his main task in the 112th Congress was to make sure that President Obama would not be re-elected. Given how he and House Speaker John Boehner have handled the payroll tax debate, we wonder if they might end up re-electing the President before the 2012 campaign even begins in earnest.

The GOP leaders have somehow managed the remarkable feat of being blamed for opposing a one-year extension of a tax holiday that they are surely going to pass. This is no easy double play.

It’s worth noting that the WSJ editorial doesn’t seem especially enamored with the proposed tax break itself — the editors see “the entire exercise” as “political” — but it nevertheless seems amazed that Republicans are screwing up the fight this badly. Indeed, the Journal added that GOP lawmakers have “achieved the small miracle of letting Mr. Obama position himself as an election-year tax cutter.”

Assuring Republicans that “the political rout will only get worse,” the WSJ urged the GOP to “cut their losses and find a way to extend the payroll holiday quickly.”

In case this isn’t obvious, when congressional Republicans have lost the editorial board of the Wall Street Journal, they’ve reached a humiliating level of failure.

It’s far from clear, however, what GOP leaders intend to do about it. Senators left Washington over the weekend, confident that the House wouldn’t screw this up. After the lower chamber did screw it up, many House members headed to the airport, too. Folks like House Speaker John Boehner (R-Ohio) are demanding that Senate Democrats agree to come back to DC and start giving Republicans goodies to make the far-right happy — Boehner wants the White House to lend him a hand in this endeavor — but Democratic leaders believe they’re holding a much better hand and are content to watch the GOP flail.

With the tax break poised to expire in 10 days and 16 hours, what’s the end game? The New York Times sketched out the remaining options.

Republicans could decide to accept the two-month extension as is or with additional sweeteners, like a promise that a conference committee would meet to seek a longer-term extension, but such a move would require unanimous consent from the Senate. They could add another social policy rider, as is their tendency, and the Senate could toss it off the bill later, through a procedure that has been employed in the past. Or they could do similar procedural moves with a bill to extend the benefits for a year, which has been the goal of Mr. Obama and Democrats all along.

I’ll have more on the conference committee option later today.