Obama, Republicans agree to tax cut extension
As was expected, President Barack Obama and congressional Republicans have tentatively agreed to a deal that would prevent the largest tax hikes in American history (at least for two years), while also extending unemployment benefits and extending some other tax breaks:
President Barack Obama reached agreement Monday with Republican leaders in Congress on a broad tax package that would extend the Bush-era income tax cuts for two years, reduce worker payroll taxes for one year and give more favorable treatment to business investments.
Other elements of the deal include a temporary reinstatement of the estate tax at 35%—the level favored by most Republican lawmakers—as well as an extension of jobless benefits for the long-term unemployed.
“We have arrived at a framework for a bipartisan agreement,’’ Mr. Obama said on Monday night, capping weeks of negotiations with leaders in Congress.
While it looks like there is finally an agreement between Obama and Republicans, House Democrats may not go along with the deal:
The biggest problem — most seem to have forgotten — is in the House. Many seem to have forgotten that it is the House, which must originate tax bills, that last week voted by a 234-188 margin to limit the extension of the Bush tax cuts to families making less than $250,000 — Obama’s original campaign pledge.
Speaker-to-Be John Boehner denounced the vote as grandstanding “chicken crap,” but, being the legislative veteran that he is, he understood its procedural significance: It meant that whatever the Senate produces must come back to the House for another vote.
And that is where the real crisis could kick in for White House, which increasingly is in the position of fighting with its party base.
And this is why Jamie Dupree believes we may see the makings of the legislative Christmas tree, a bill loaded with pork and other goodies to encourage Democrats into voting for the bill, which being seen by some the opening of the president’s bid for re-election.