Congress is coming back, having bought themselves some time at the end of last session, to hammer out a deal on a year-long extension of the payroll tax cut, unemployment benefits, and the Medicare "doc fix," preventing a 27 percent cut in physician Medicare reimbursements. Before leaving for the holiday break, lawmakers gave themselves an extension until the end of February. Bipartisan staff meetings have been happening among the 20 members from both chambers who have been tasked with reconciling the House and Senate proposals, and that's where it gets interesting. Because, while tax cuts for the wealthy have never had to be paid for, Democrats have conceded that tax cuts for the rest of us do, so the fight over the "pay-fors" will continue.
While lawmakers are anxious to get this done and get it behind them, there are still extremely contentious elements, particularly in the House Republicans' bill, that House Speaker Boehner could have a hard time finding agreement on.
In recent days, GOP aides have been pushing the House’s yearlong extension, which passed along a mostly party-line 234-193 vote, as a starting point in the new round of talks. The legislation calls for provisions which previously have enjoyed White House support: increasing Medicare premiums for affluent Americans, spectrum auctions to boost high-speed Internet services, and extending Obama’s pay freeze for federal workers through 2013, though the president said he’ll propose a slight 0.5 percent increase in federal pay in his new budget.
But the House plan also includes proposals loathed by Democrats: construction of the controversial Keystone XL oil pipeline, scaling back air-pollution rules for industrial boilers, reducing the length of unemployment benefits and cutting funds for Obama’s health care reform law.
“Given the reasonableness of the House-passed bill, and given the work that has already been done, there is no reason this bill cannot be completed swiftly and with little acrimony,” Michael Steel, a spokesman for House Speaker John Boehner, wrote in an email. “Frankly, the only way this process will not go smoothly and through regular order is if the White House chooses to disrupt it for political reasons.”
Right, House Republicans are so reasonable. That must be why they're so popular right now.
The White House might not have serious problems with means testing Medicare, but it might not be popular with congressional Democrats. Boehner still has a contingent of hard-line nihilists who don't want to give the president any victories even if that means being responsible for a tax hike on middle class Americans. They expressed some pretty strong opposition to the short-term extension and Boehner's capitulation (even though none of them bothered to show up to block the unanimous consent it passed by).
Then there's the Keystone XL issue, which would seemingly be resolved by the fact that it passed already, and their arbitrary deadline of Feb. 21 for a decision has been imposed. If it continues to look as though, as it does right now, the State Department will deny the permits per that deadline, Republicans might try to find another way to keep that fight going, and continue to use this legislation as their vehicle.
Ultimately, the hardliner faction is the wild card. Right now it's unclear whether there are enough Republicans willing to go along with concessions that Democrats seem to be willing to force on them. If Democrats maintain their resolve to now allow cuts to the Affordable Care Act, to unemployment insurance, and to Medicare benefits, Boehner will probably lose significant Republicans support and have to agree to a package that Democrats will be willing to support, or end up being the guy responsible for a tax hike on the middle class in an election year.