Friday, December 23, 2011

The Wall Street Journal PWNS House R's/Boehner Over Payroll Tax Cut *UPDATED*

The Wall Street Journal, which could never be confused with anything Left-leaning, is calling shenanigans on the House Republicans (read: the Tea Party) and the man who apparently is unable to lead them, Speaker John Boehner. The issue - the Payroll Tax Cut which, in case you didn't know, you have been receiving for the past year.1  In a nutshell, both Democrats and Republicans want to pass the Payroll Tax Cut for middle class American workers, but they disagree about how it should be paid for and they also disagree on how much longer it should last (it's set to expire next month).  Nevertheless, the Senate recently passed a measure to extend the Tax Cut for another two months, but, for some strange reason, House Speaker Boehner is unable to get the House Tea Party Republicans to get in line and support the Senate's extension.  This has painted the Republicans as anti-tax cut for the middle class and, conversely, has painted Obama as the champion of the middle class.  And that, my friends, was the last straw for establishment Republicans.

Enter the Wall Street Journal:

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.
Republicans have also achieved the small miracle of letting Mr. Obama position himself as an election-year tax cutter, although he's spent most of his Presidency promoting tax increases and he would hit the economy with one of the largest tax increases ever in 2013. This should be impossible.
...
Senate Republicans say Mr. Boehner had signed off on the two-month extension, but House Members revolted over the weekend and so the Speaker flipped within 24 hours. Mr. Boehner is now demanding that Mr. Reid name conferees for a House-Senate conference on the payroll tax bills. But Mr. Reid and the White House are having too much fun blaming Republicans for "raising taxes on the middle class" as of January 1. Don't be surprised if they stretch this out to the State of the Union, when Mr. Obama will have a national audience to capture the tax issue.
If Republicans didn't want to extend the payroll tax cut on the merits, then they should have put together a strategy and the arguments for defeating it and explained why.
But if they knew they would eventually pass it, as most of them surely believed, then they had one of two choices. Either pass it quickly and at least take some political credit for it.
Or agree on a strategy to get something in return for passing it, which would mean focusing on a couple of popular policies that would put Mr. Obama and Democrats on the political spot.
...

After a year of the tea party House, Mr. Obama and Senate Democrats have had to make no major policy concessions beyond extending the Bush tax rates for two years. Mr. Obama is in a stronger re-election position today than he was a year ago, and the chances of Mr. McConnell becoming Majority Leader in 2013 are declining.
At this stage, Republicans would do best to cut their losses and find a way to extend the payroll holiday quickly.


*UPDATE*

House Republicans Caved on the Payroll Tax Cut extension for 2 months. From ABC News:


A muted House Speaker John Boehner announced today that Republicans have decided to accept a short-term extension of the payroll tax cut, preventing a hike in taxes just nine days before the tax break expires for 160 million Americans.
House GOP leaders appeared to be adopting a compromise suggested by Senate Minority Leader Mitch McConnell to pass the two-month extension in exchange for the Senate appointing members to a conference committee, which will negotiate a longer-term solution. The proposal won a nod of approval from President Obama and Senate Majority Leader Harry Reid.
But Boehner was visibly unhappy with the deal.
"Kicking a can down the road for a couple of months does cause problems," he said at a news conference today.
House Republicans had originally wanted a one-year extension but faced mounting pressure from conservatives and their Senate counterparts to come to an agreement on the short-term deal.
"Sometimes it's politically difficult to do the right thing," Boehner said.
He admitted that the House Republicans' refusal to compromise on the short-term extension, which received backlash even from conservatives, politically "may not be the smartest thing in this world... but our members waged a good fight."
The deal entails a new bill with language protecting small businesses from a measure in the Senate bill that creates temporary new caps on the wages that are subject to payroll tax relief, a Republican aide said. Reid accepted the House Republicans' proposal late this afternoon.
The bill will be passed by unanimous consent, which would not require all the members to return for a vote.
And an interesting editorial by Eugene Robinson:

Finally. After a year of artful camouflage and concealment, Republicans let us glimpse the rift between establishment pragmatists and Tea Party ideologues. There may be hope for the republic after all.
...
More sensible Republicans have been so eager to take advantage of the Tea Party’s energy and emotion that they have essentially allowed the inmates to run the asylum. You will recall that it was the GOP, led by the Tea Party types, that threatened to send the Treasury into default last summer rather than approve a routine and necessary increase in the debt ceiling.
In the current imbroglio, nothing resembling a principle was involved. Boehner said that House Republicans wanted to extend the payroll tax cut for an entire year, rather than just two months. But even if you accept his claim at face value, it ignores the fact that the two-month deal was approved by the Senate for one reason only: to allow time for negotiation of a one-year extension.
In other words, the measure that House Republicans were so reluctant to pass, or even vote on, was crafted as a step toward the specific outcome that House Republicans claimed was their goal.
...

There are only two possible reasons for House Republicans to behave the way they did. Maybe they are so blinded by ideology that they no longer care about the impact their actions might have on struggling American families. Or maybe their only guiding principle is that anything Obama supports, they oppose.





Questions:
Did the Wall Street Journal get it right?
Did the Republicans shoot themselves in the foot by being the party of "No"?
Can John Boehner get his House in order?
Will the Payroll Tax Cut get passed?
Does this help Obama in 2012?


1 - If you weren't aware that your taxes have actually gone down over the past year it should come as no surprise because, as usual, the Democrats fail at marketing any of their accomplishments.
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