Holiday tax showdown
WASHINGTON — Butler County’s two congressmen are on the opposite sides of the battle over a bill to prevent payroll taxes from going up on 160 million workers.
Rep. Mike Kelly, R-3rd, of Butler supports the Republican stand to negotiate a one-year deal with the Senate, which already has gone home for the holidays.
Rep. Jason Altmire, D-4th, backs a bill passed by the Senate to extend the cuts for two months and work on another bill later.
A House vote Tuesday scuttled the bipartisan Senate deal for a two-month extension of three policies: the payroll tax cuts, jobless benefits and Medicare fees.
In Washington, President Barack Obama and his Republican rivals are slugging it out rather than reaching for a holiday season accord.
The tax increases, as well as cuts to Medicare doctors’ fees and a lapse in jobless benefits, are due Jan. 1. They are looming even though Democrats and Republicans agree that they shouldn’t happen. Instead of stopping them, the factions have painted themselves into a corner.
House Republicans are demanding that the Senate join negotiations to produce an agreement within days. Senate Democrats insist no talks will take place before the House approves a stopgap measure to buy more time.
Kelly issued this statement on the issue:
“I believe, as does President Obama, that we need to extend the payroll tax cut for a full year, not just two months.
“Unfortunately, the Senate disagreed with us, and now refuses to come back to Washington to work out an agreement with the House that would give hardworking Americans a tax break for all of 2012.
“Their decision to punt on the issue was a disappointment, and the American people deserve better than the short-term, short-sighted solution that the Senate was willing to give them.
“My colleagues and I in the House have heard from job creators throughout the country who have said that extending the payroll tax cut for only two months will create confusion and uncertainty, especially for small businesses that process their payroll paperwork in-house.
“I am committed to staying in Washington as long as it takes to get a yearlong agreement for the American people.”
Altmire slammed the GOP in his statement.
“If the American public needed any more proof that Washington is broken, it was just handed to them on a silver platter.
“Right now, tax cuts for hard working Americans are in jeopardy because party extremists refuse to accept the idea of compromise.”
Whether it’s this week or when Congress reconvenes in the new year, Altmire said he’s going to push his colleagues to approve a measure that would extend the tax cuts and unemployment benefits for an entire year.
“This all-or-nothing approach that Congress has become accustomed to is hurting our economic recovery and the American people expect more from us,” he said.
After the House killed the Senate measure on a 229-193 vote, Obama signaled he’ll use his presidential megaphone to try to force Republicans controlling the House into submission.
“Now let’s be clear,” Obama said. “The bipartisan compromise that was reached on Saturday is the only viable way to prevent a tax hike on Jan. 1. The only one.”
With their candidate’s poll numbers rising, Democratic operatives seemed almost giddy at the prospect of a prolonged battle.
Republican lawmakers relished the battle as well.
House Republicans instead rallied around a plan passed last week that would have extended the payroll tax cut for one year. But that version also contained spending cuts opposed by Democrats and tighter rules for jobless benefits.
If legislation isn’t passed by New Year’s Day, payroll taxes will go up by almost $20 a week for a worker making a $50,000 salary. Almost 2 million people could lose unemployment benefits as well, and doctors would bear big cuts in Medicare payments.
Whatever the stakes, there was little indication that Republicans would get their wish for negotiations with the Senate soon. Senate Majority Leader Harry Reid, D-Nev., issued a statement saying he would be happy to resume talks on a yearlong measure, “but not before” the House ratifies the two-month bill.
Given Obama’s remarks and Reid’s refusal to negotiate, it was unclear what leverage Republicans had in the year-end standoff.
Eagle staff reporter Jared Stonesifer contributed to this report.
