Boehner Caves on Payroll Tax Cut Folly

Question: Where does the funding for Social Security and Medicaid come from?

Answer: The funding for Social Security and Medicaid comes from payroll taxes.

Question: How does cutting payroll taxes by robbing Social Security and Medicaid funds help anybody?

Answer: It enables Obama to make the false claim that he cut taxes. It also helps Obama continue destroying America!

Congress approves short-term payroll tax, unemployment benefits

• Pipeline bill heads to White House

By Stephen Dinan

The Washington Times

House Minority Whip Rep. Steny Hoyer, D-Md., is followed by reporters after holding a news conference on the payroll tax cut on Capitol Hill on Thursday, Dec. 22, 2011, in Washington. (AP Photo/Evan Vucci)

Congress closed out its legislative year on Friday the same way it began: with a divided House and Senate agreeing to a short-term extension, in this case renewing the payroll tax holiday for two more months, but leaving the bigger work for later.

The bill does force President Obama to make a final decision on permitting the Keystone XL pipeline, which he had vehemently objected to, but it delivers him a major victory by extending unemployment benefits for the long-term jobless yet again, without any of the new conditions the GOP had sought to impose.

The cavernous House chamber and the more intimate Senate floor were nearly empty as both chambers passed the bill in pro forma sessions. If any member in either chamber had objected, the deal would have been scuttled, but nobody did.

“I hope this Congress has had a very good learning experience,” said Senate Majority Leader Harry Reid, Nevada Democrat. “Everything we do around here doesn’t have to end up in a fight.”

Presiding over the House session was Speaker John A. Boehner, the man who has been battered by the entire tax exchange.

** FILE ** Senate Majority Leader Harry Reid of Nev., meets with reporters on Capitol Hill in Washington, Tuesday, Oct. 4, 2011, after a Democratic caucus lunch. (AP Photo/J. Scott Applewhite)

Mr. Boehner initially seemed to approve the two-month deal worked out by the Senate, then after the HouseGOP balked he announced on Sunday the House would insist on its yearlong bill instead. But as pressure mounted, Mr. Boehner’s colleagues fled and he had no choice but to change course and concede defeat.

“Our conference told the speaker to draw a line in the sand, the speaker stood up and drew it for us, and then our conference began to desert him,” said Rep. Rob Woodall, a freshman Republican from Georgia. “Our speaker was ready to lead us, the question is, are we ready to follow.”

Mr. Woodall was one of the dozen House Republicans who opposed even the GOP’s own bill, arguing that it didn’t make budget sense to use savings over 10 years to offset a one-year or two-month tax cut — as both House and Senate bills did.

The short-term bill is the latest punt in a year full of them: Early on, Congress passed repeated stopgap spending bills as it wrestled with long-overdue 2011 funding measures. And throughout the year it has passed repeated extensions of the highway bill, small business programs and the Federal Aviation Administration.

All sides agree the two-month tax cut extension is inadequate, and all sides also said they had wanted to secure a full-year deal — but with senators already home for vacation and House Republican leaders stepping on their own messaging, the capital city declared the two-month deal a winning compromise.

The bill extends this year’s payroll tax cut through the end of February, and also continues unemployment benefits though for fewer weeks than in the past, and grants full payments to doctors who treat Medicare patients. Under the terms of a 1997 budget deal, those doctor payments were scheduled to be cut 27 percent.

Lost revenue from the payroll tax cut is offset by a new fee on mortgages.

House Republicans had sought a yearlong extension of the payroll tax cut, extended full doctor payments for two years.

It also provided for additional unemployment benefits though only under new rules that would have allowed states to impose drug-testing and would have pushed beneficiaries to get a graduate equivalency degree. Democrats objected and those provisions are not in the two-month bill.

House Republicans tried to save face by insisting Friday’s agreement takes care of the paperwork burden a two-month extension would impose on businesses. Democrats, who won a near-complete victory in the showdown, agreed to that addition.