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Jonathan Ernst / REUTERS file
Harry Reid, center, hasn't ruled out other ways of offsetting the revenue loss caused by the payroll tax cut, if Republicans succeed in blocking the surtax.
Over the next few weeks, Congress faces a sprawling mess of tax and spending decisions, with the likely outcome being an overstuffed pre-Christmas package held together with the legislative equivalent of wrapping tape.
Complain if you will about congressional gridlock, but right before the holidays is often when the gridlock eases because everyone is focused on getting out of town and back to their families.
This week is merely the opening round of the bargaining. The decisive question: What tradeoffs will members of Congress be willing to make as the clock ticks down to the middle of the December?
This week’s action focuses on Senate votes to extend the Social Security payroll tax cut which Congress passed almost exactly one year ago in a similar end-of-year bargaining bazaar. Without the extension, a worker who earns $40,000 would see his or her payroll tax go up by $800 in 2012.
“Republicans know that raising taxes on the middle class is the wrong thing to do,” said Senate Majority Leader Harry Reid Tuesday after the weekly strategy luncheon with his Democratic colleagues.
Democratic leaders propose to pay for an expansion of the payroll tax cut with a surtax on incomes over $1 million, an idea Republicans oppose.
On Tuesday, Reid didn’t rule out other ways of offsetting the revenue loss caused by the payroll tax cut, if Republicans succeed in blocking the surtax. “We are going to continue working until we get the payroll tax (cut) extended,” Reid said.
Reid also didn’t rule out simply passing the tax cut without any offsetting revenue raiser. “Let’s see what happens on this (surtax vote),” he said.
Sen. Chuck Schumer (D-NY) lays the reasons why he thinks "we have a good chance of actually getting a good package for deficit reduction in 2012."
Senate Republican Whip Jon Kyl said Sunday that the payroll tax cut “has not stimulated job creation.” But on Tuesday two other Republicans from opposite ends of their party’s ideological spectrum indicated they weren’t opposed to the payroll tax cut.
“I don't like toying with taxes the way we are doing,” said Sen. Jim DeMint, R-S.C. But he added, “I just don't think it's a good time to increase any taxes, so we're looking for a way to pay for it.”
And Sen. Olympia Snowe, R-Maine, voiced support for extending the tax cut, but wasn’t too enthusiastic about it. “What I've heard from employers is that a one-year policy isn’t going to be sufficient” to create sustainable employment, she told reporters. The payroll tax cut is “a short-term measure that’s not going to achieve the long term results … We should be doing more long-term policy of fundamental structural (tax) reforms … .” But despite talk of the long term, Congress now seems able only to legislate for a year at a time.
Senate staffers on both sides of the aisle indicated that the payroll tax cut extension will probably pass, after some theatrics, assuming some revenue offset is found.
The other must-pass contents of the end-of-year package that Reid mentioned Tuesday included:
1. An extension of emergency unemployment insurance benefits which currently provide up to 53 weeks of additional money after the regular 26 weeks of state payments have been exhausted. Of the dozen policy options, including the payroll tax cut, which Congressional Budget Office director Douglas Elmendorf examined in his Nov. 15 testimony to the Senate Budget Committee, extending unemployment benefits was the most cost-effective way of creating additional employment. That might sound paradoxical, but he said, “Households receiving unemployment benefits tend to spend the additional benefits quickly, making this option both timely and cost-effective in spurring demand for goods and services, and thereby economic activity and employment.”
2. The postponement of the scheduled 29 percent cut in payments to doctors serving Medicare patients. The cut in payments to doctors is a result of the 1997 budget law, which attempted to restrain Medicare spending. But each year since 2003, Congress has overridden the reduction in payments and allowed the postponed reductions to accumulate. So if Congress fails to act, doctors next year will see a sharp cut in what they get paid for treating Medicare patients
3. The extension of at least some of the 53 tax credits and preferences which Congress created or preserved last December. The platter of tax breaks includes something for almost all tastes: the deduction of state and local sales taxes, which is worth about $2.8 billion to taxpayers who itemize, the economic development credit for American Samoa, worth about $15 million, a tax break for mine safety equipment, worth about $20 million, and many others.
With the holiday break approaching, Congress still has plenty on its plate including avoiding big pay reductions for Medicare doctors and avoiding another government shutdown. NBC's Luke Russert reports.
Almost certain to be in the final package is a “patch,” or one-year adjustment, of the Alternative Minimum Tax, which will otherwise hit upper-middle class people who have lots of deductions. The current AMT “patch” is providing about $136 billion of tax relief, according to the Joint Congressional Committee on Taxation.
The vehicle for all this is likely to be a bill providing funding for the agencies and departments for which Congress hasn't yet passed annual appropriations bills. The current funding runs out on Dec. 16 but Congress could pass a stopgap extension and then a longer-term one before it adjourns for the year.
If the package does pass, the budget deficit in the current fiscal year may not be any smaller – and depending on economic growth, may be bigger than the Fiscal Year 2011 deficit of 8.7 percent of Gross Domestic Product . Despite the attempt to “pay for” the payroll tax cut with some offsetting revenue, the other elements in the package are all revenue losers
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Typical. The only thing the Democrats and Republicans can agree on is cut taxes and increase spending. Meanwhile the decision no one wants on their record (raise taxes and / or decrease spending) is passed to next year yet again.
Eric provided a link earlier in these posts to spending and deficit charts under Bush and Obama. I found it interesting that the spending really accelerated under Bush in 2008. What happened? Democrats took control of Congress. You know congress that controls spending. Obama spending and deficits went up then started going down in 2010. What happened? Republicans took control of Congress. There is enough blame to go around without each side cherry picking data and giving half the story.
If you think Congress controls spending look at Clinton and Bush.
Both had GOP Congresses.
One was fiscally responsible and one was a fiscal disaster like this country has never seen before.
You're right to a point common sense. Under Bush and a republican congress spending went up way too much. It went up even more after democrats took control. That has birthed the tea party that most democrats loathe, even while railing against spending by republicans but turning a blind eye to spending by democrats. As far as a disaster like this country has never seen before I agree. But we have seen a bigger disaster since. Spending under Obama and democrats in congress.
No, Bush had a Democrat controlled congress, blocking his every effort to save the economy and rein in Freddie Mac. In fact we did not accumulate significant debt until after the Democrats got control of congress.
willing
You're kidding right?
You do know Bush had a surplus and started spending non stop while implementing THE biggest socialist program in decades.
2008 was the beginning of the biggest recession in 80 years, tax revenues started declining and the wars were added to the books where Bush had kept them as "Special Appropriations"
So what spending bills did the Dem congress introduce that Bush signed?
Sorry....Nice try.
JOHN: You neglect to mention what each party spent money on. The GOP spent it on a senseless war which they never bothered funding and tax breaks for corporate American & the super rich. Not a good return on investment. You dont' cut taxes in wartime, that is absurd. We have never done that before in our history.
Democrats spend money on things which help the average American. What have we reaped from the war in Iraq? Only an Iran which had been checked by Saddam is now emboldened. Beyond that where is this supposed bonus from the "Job Creators" after ten years of giving them huge tax cuts? And yet the GOP wants even more tax cuts for the rich and is baulking at repeateding the payroll tax cut which helps the average working person.
Common sense 4 U
give me a break with that democratic rhetoric. When Bush left office and Obama took over each family's share of the national debt was $45,000.00.
As of the first of August 2011 under Obama and the Democrats each family's share of our National debt grew to $122,303.00.
That means that Obama and the Democrats grew the national debt for each family by $77,303.00 in 2.75 years. That's $30,921.20 per year.
Since our country is in deep trouble and its shown that neither the democrats nor the Republicans are will to do anything to change the direction this country is going in you can be sure this country will be a 3rd world nation before you know what hit you.
"Bread and Circuses". Toss out largess to solicit votes. Too bad the self-interest of our politicians will bankrupt the country. So much for responsible leadership, there is none.
1. Pass a balanced budget amendment.
2. End the income tax relief and restore the taxes on the rich, 35% up to 39.6%.
3. Cut government departments, Education, Energy, etc.
4. Initiate work furloughs, one workday a month for ALL federal employees, including Congress, the military, EVERBODY.
5. If Congress fails to do Nos. 1-4, vote them out, including recall elections if their terms aren't expiring!
Yes, raise taxes but on someone else ie the group that already pays over 50% of individual federal income tax!! That's what I call shared sacrifice!!!
Congress should cut all compensation to federal employees so that it is more in keeping with the private sector. If federal employees do not like it they will be free to pursue the multitude of job openings in the private sector. Congress should be working for the tax payers and not federal employees.
Your dreaming. Have you read these posts?
Half are little D's and blame everything on the R's.
The other half are little R's that blame everything on the D's.
The public schools graduate morons who don't know why, but they are little D's or little R's and no one wants to take responsibility for anything.
Responsibility left the curriculum in unionized public schools back in the 80's when the feds took over and forced the Dept Of Education onto the school system.
The early 80's. That's the last time we produced educated students.
I think that Reed is the President's man. The President is obsessed with increasing taxes on the rich so such provisions are a part of almost every bill whose origin in the White House The increased taxes on the rich that the White House wants will net about 100 billion dollars a year. That is 100 billion dollars a year taken from the private sector and put into the public sector. The federal government is already running deficits of more than one trillion dollars a year so who knows what spending the additional revenue will cover. The way things are going such an increase in revenue will motivate the government to spend much more money than the government will take in. The President promised the American people that the 2012 federal deficit will not exceed 229.27 billion dollars and congress needs to pass a budget for 2012 that insures that the President's promise to the American people, that the majority of us voted for, is kept.
the best solution for all this mess includes 2 things:
1-- Tax reform
2-- One-term Congress
Obama Approval Remains at 43% Through Thanksgiving Week
That's gutter-low. Unelectable low.
Better than Reagan had at the same point.....Reagan had higher unemployment too........With a much better economy handed to him.
Far better than Bush after he was done destroying the country.
I expect that they will waste time trying to sneak in a way to untrigger their triggers for not being able to do their jobs on the budget in the first place. Which if Obama is true to his word he should rightfully veto and send them back to the drawing board. I say lock them in the capital building until they get it figured out and if they miss Christmas then maybe they will think about doing their jobs right the first time next time around.
It didn't work with Obamacare. Forced/Shoved through LATE, late Christmas Eve.
Against the will of the people.
Our President may not be in office in 2013 to veto anything.
Obama also was legally forced to hand banks another $40,000,000,000 last September because of a law passed under Warren Harding. This latest bilking mostly went under the radar.
And you guessed it, the fake congress would never touch that old Harding ruling.
The republicans are doing everything they can do to stop President Obama from getting us out of this mess Geo Bush(Idiot Draft dodging SOB) got this country into. David Walker the past comptroller of the the United States has the figures and the facts. Bush was such a loser just like Boehner (Rummy a drunk) and Cheney (took 5 draft deferments in his home town during the Vietnam War). In 2003 Bush lead us into invading into Iraq only because Hussein swore to kill old man bush. Now look what we have a real mess left to us by the republicans who think they have the way out when they put us in the ditch to start with. We all have to face it taxes are coming thanks to the republicans who spent like drunken sailors from 2003 to 2005.(McCain and Boehner leading the pact). We all better wake up and realize that the republicans love war because the defense contractors keep them (Cantor,Ryan Boehener,McConnell in office). Bush,Cheney,Rice,Rumsfelt all need to be in a federal prison for war crimes). Now look they bring Newt the only house speaker who had to resign because he was hitting on young babes in the house now remember this is the party of true religion and conservatism. What next Cain is innocent yea right so was Hitler.
I hope you feel better now, jim.
What if they did come up with tax cuts in exchange for revenue. Reduced medicare payments has been overridden some 13 times. What do you think will happen to any new supposed cuts especially if Dems regain control. The fact is this game will continue until the fed has to back off and interest rates start to rise. Then US will be downgraded across the board and panic will ensue in Washington. The Fed is playing with our currency the same as the Chinese.
This week’s action focuses on Senate votes to extend the Social Security payroll tax cut which Congress passed almost exactly one year ago in a similar end-of-year bargaining bazaar. Without the extension, a worker who earns $40,000 would see his or her payroll tax go up by $800 in 2012.
With this kind of shell game going on Social Security will run out of money. Let's screw our self some more PLEASE................. How stupid.
Twisted government accounting behind Postal Service woes.
When former members of the U.S. military
take a government job, their military service counts as annual credits toward pension
eligibility. This holds true when service members take postal jobs — but who pays for the
value of those credits? In 2006, the Postal Service was shouldering that cost on its
balance sheet, even though there was general agreement that the Treasury Department should
be responsible for pension credit earned prior to employment with the Postal Service.
So with that fact, why is the USPS forced to pay for military service if it operates
independent/without taxpayer money. This also explains how Social Security is in such a
mess because it operates the same way as the USPS, independent trusts!!!!!!! So Congress
should keep it's hands off of the money that is not there for them to mess with plain and
simple........
First, it's important to note that the USPS is financially self-sufficient. Since the
1970s, it has been mandated by Congress to operate entirely on its own revenue, with no
taxpayer money. It's an enormous agency — with $65 billion in annual revenue, it would be a
Fortune 50 company if it were a private entity. As a quasi-government agency, it enjoys
privileged fiscal status — its revenue and expenses are "off budget," meaning Congress
isn't supposed to be able to toy with them. It shares this privileged state with only one
other government entity: the Social Security Trust Fund. But as you know, Congress finds a
way to toy with everything.
The problem of military pension credits itself was a creation of just such a deficit-hiding
accounting trick. In 2002, an audit of the USPS budget found it had overpaid into the
federal government's pension plan by roughly $80 billion. Postal Service officials lobbied
hard have its pension payments readjusted. They were, in 2003, but in order to make the
shift revenue neutral, military pension credit costs were shifted from Treasury to the
USPS.
Always liking shots of Chuckie Shumer and Harry Reid! Two incompetent F---! leading the masses into oblivion.
And boehner and cantor are doing what?
hahahahhahahahahahhahahahahhahahahahhahahahahahha
That is too funny....
boehner and cantor.....How about mcConnell.....He says his #1 goal is to make Americans suffer.
His #1 goal.
hahahahhahahahahahahhahahahahhahahahhaha
Gotta wonder how brain dead you have to be to follow a guy who wants you to suffer.
You have to be so stupid that you should be put behind bars so as not to endanger the public.
So the facts are this:
Clinton under a GOP congress took the deficits Bush Sr handed him and reduced the deficit until we had a surplus.
Bush Jr immediately started spending non stop, implementing 2 wars (that were off the books) and implementing Bushcare...THE biggest socialist hand out in decades.
In 6 years with a GOP congress.
And right wingers are too brainwashed to be able to grasp this reality???
HHHAHAHAHHAHAHHAHAHAHAHAHH
No wonder the GOP tries to cut education every chance they get.
They need more absolutely clueless voters.
hahahahahahahahahahahaha
EDUCATION? Is that what you term hordes of high-school seniors who can't complete a sentence, much less compose a paragraph?
No, just cutting the waste going to poorly qualified, lazy union teachers.
Yeah, why does the GOP want more and more people like that?
OHHHHHHH
Educated people won't vote for them unless they make $millions.
hahahahhahahaha
FACTS??? Bush senior laid groundwork for Clinton. Clinton benefitted from a tech bubble that burst just after he left office. It was a period when the government was collecting lots of taxes from newly minted millionaires and lots of capital gains. Bush Jr. got to handle the downfall from this period as well as Enron and Worldcom. These are facts.
Disgusted, do you see your own grammar and abilities taking you much further.
Keep smoking gardner, you are stoned out of your mind.
Clinton's increases in spending averaged just over 3%.
Bush avareaged over 6% and that doesn't include 2 wars that cost over a $trillion.
You are a complete and total fool, you are a factual midget.
Just the perfect GOPer
Not really, trying to keep a small business afloat.
"Jim440599 watch out" the truth may hurt many on the vine...lol
Do you think one of the OWS people will write a best seller about the protests and be propelled into the top 1%. Do you think he will skip all the exemptions and deductions and pay his fair share??
Achievement is a scary word for the losers in the owEs movement. They seek mediocrity by hanging and hiding out with other losers. That way they will not be exposed for the non-competitive, spoiled weaklings they were raised to be. Everyone was a winner and received a trophy just for showing up, now they find out that a decent living MUST BE EARNED AND IS NOT FREE!!!!! LIFE IS TOUGH, WEAR A CUP!!!
Are you making a point that the top 1% should pay more taxes? Just asking..
bye bye libs, it's over for you. STOP DESTROYING MY KIDS' FUTURE!!!
The GOP destroyed your kids future.
Or you did it to them.
Too bad you're not educated enough to look at the facts.
Guess your kids will likely be uneducated too.
Too bad for them.
Private education and an mba, how about you? It is you who are ignorant. My kids go to private schools and are taught PERSONAL RESPONSIBILITY AND MOTIVATION. Everything you are afraid of.
James, "PERSONAL RESPONSIBILITY AND MOTIVATION"!!?? What are you thinking!!?? The left is saying "what can I gain fromn someone else:"!!?? Tax and spend, that is all they know! I have over 40 years of hard work with almost 15 years of hard work after high school and I owe someone else!!??
You just don't teach them facts obviously.
You certainly hate them.
You sure love your political party...You'll fill your brain with whatever you can to protect what you want to believe.
No matter how insane it is....You will force yourself to believe.
Sad.
You send your kids to private school, how do you know public school teachers are lazy and over paid?
Hannity told you?
hahahahhahahaha
JDM you sound a little spoiled like the ows protesters you mentioned in a previous post.
Private education and an mba, how about you?
JAMES: Guess you're an "elitist" then, huh? Isn't that what the Right calls all those "Hollywood Liberals" and folks like Obama who got into Columbia and Harvard based upon his smarts???
Here's a clue for buddy. Those public schools that you denagrate as well as the "union" teachers who teach in them CREATED THE MIDDLE CLASS in this nation. Are you intimating that somehow going to a public school you don't learn responsibility? Many, many of our finest minds have come out of the public educations system so I suggest you get the hell off your high horse.
Anytime you want to compare Liberal to Conservative minds, that's a challenge I'll accept in a heartbeat. Not to mention some of the most awsome people this nation has produced in the last 50 years. Medal of Honor recipients, fantastic celebrities like Paul Newman, Gregory Peck, Kirk Douglas, James Garner and hundreds more. All "Hollywood Elitests" who were not afraid to give back to their country. Newman alone gave nearly 300 million while he was alive and his charities are still being run by his kids. I had the pleasure of meeting him years ago and I can promise you, the guy defined the word "class". Of course, you clowns on the Right do have Wayne Newton and Larry Gatlin. LOL
The Democrats love to spend money as long as it is not theirs.
So why do RED states overwhelmingly get more Fed tax $$ than they pay out?
10 of the top 10 states that get more Fed tax $$ are RED
9 of the top 10 that pay out more are BLUE.
Guess that just shot your whole fantasy world down.
COMMON: Give em hell buddy. You're doing a great job. Remember what Harry Truman said, "they call me given hell Harry but all I do is tell the truth, and they think it's hell" :)
Reed and Pelosi: Wow: Two who need to be tried for treason by our military court and sent to where ever land they can find for them. The people of Nevada are so ignorant and stupid. How could anyone vote for this lying deceiving man who is turning this country into a socialist, communist country and the people of Nevada still vote democrat. Wow the liberal do nothing, no discipline party who educates our kids and produce mindless voters such as live in Nevada to vote in this lying no good man, wow, I can't believe so many ignorant people live in this country. This man is rape-ing-ing our nation and those in Nevada don't report him---sort of like the Penn State Program--ugly oh so ugly
How is he turning this country communist/socialist?
I ask right wingers this question all the time and they usually lake the intellectual capacity to answer.
They usually run like cowards because they aren't smart enough to articulate a point.
I'm betting you are the same coward.
RICHARD: Still with the Commie crap.
Your party has a long and sordid history of questioning the patriotism of those who don't asribe to your political views. It's not becoming and instantly identifies you as a mindless party hack for the GOP. Guess you never lived through the nightmare of the McCarthy era when everyone was looking for a commie underneath their bed and peoples lives were ruined.
You couldn't even define a Socialist if you tripped over one. Just parroting the Rush Limbaugh, Sean Hannity talking points, eh buddy??? Did you get half as pissed off when Bush lied us into a war, an UNFUNDED war that really is bankrupting us and has dragged on for ten long years??? Guess not, huh?
No, that doesn't enrage you. What bothers you is that we actually spend some of our money providing health care to every American. That to you is an abomination but not a senseless war which will ultimately cost us several TRILLION DOLLARS. That's Republican logic for you.
Seems like you did nothing all year long except blame each other. Why start doing your job now? We have kinda got used to your laziness.
During the Bush years, both houses
were Dem. majorities.
What does that tell you?
tells me you don't know jack!
hahahahahahahahahahahahahahahaha
Why are all you righties on here such clueless idiots?
Bush had a GOP congress for the first 6 years.....By then the damage was done.
Jeeeezz man, your kind really needs to get educated, we are all getting sick of cleaning up your messes while you sit back, collect welfare and complain.
JACK: Get a clue you mindless dolt! Bush had a GOP House and Senate for the first 6 of his 8 years. Not to mention a Supreme Court in his back pocket.
Reading a reliable new source periodically would be a good place to become informed.
Everyone knows without a doubt that there is not one Republican trying to win the nomination,that's capable of beating Obama.Of course if your lying to yourself you may believe it.Look around and it becomes clear they're running a bunch of has beens and loosers.I know youu're going to come back with some BS,because that's all you have is BS.The Republicans have taken too much for too long and gave back too little. To bad it took almost destroying the country for people to see that. But now the American people have seen through it.The party's over.
So, Obama's 43% approval makes him a "winner" ? Is that right ?? Is that kind of like Charlie Sheen thinking he is "WINNING" as he shoves more toot up his nose ???
Have you gotten your GED yet ? From the appearance of your post, it appears you flunked basic English !
.
Just another story/example after example of how those morons in Congress are failing the American people. That is unless you think debating whether or not Pizza should be defined as a veggie, at at the urging of lobbyists, is considered working in the best interest of the American people.
"The growing national debt, oh yea, we'll get to it. If you haven't noticed, we've been very busy resolving the very important pizza issue. After all, the American people deserve to know if its a snack or a veggie" Anonymous Congressperson
What do they care. They get paid no matter what they do, they have benefits the rich can only dream about, so why should they care if they turn this country into a 3rd world nation. They are the elite; the ones who place themselves above the laws they dump on the rest of us.
What this country needs is a trillion dollar lobby group called the American people to buy influence in congress like all the other special interest groups do. Then maybe we can get them to work for the American people.
Liberal wimps on here crying about how the nasty ole repubs made it bad for O'bama make me want to puke again. Fact is, your liberal, underexperienced, barely dry behind the ear, know it all representative is insufficient as a country leader and you people are just simply too hypocritical to admit that you made a mistake by putting him in the white house. Welllllllllllll, sorry bout yer luck peeps, but ya can't blame the Bush administration forever. O'bama's inaction is his own inaction, and you might as well admit it. He's selling us down the river. Point blank. He refuses to bring the troops home and refuses to secure the borders and cow tows to illegals. He's supporting them more than us. That's just the way it is folks.