The Senate planned to hold tax cut votes today on four separate proposals: one to extend the Bush-era rates on the first $250,000 of income, the “millionaire’s bracket” plan to extend the rates up to $1 million dollars, a Republican plan to extend the Bush rates permanently, and a plan to extend them for five years. This was all subject to getting unanimous consent on the four bills. One Republican objected, scuttling the votes and perhaps setting up a series of cloture votes on Saturday.
Democrats said a last-minute objection by a Republican senator scotched the deal, and they accused the GOP of opposing progress on the issue it has touted as its top priority for the lame-duck session.
Republicans countered that Majority Leader Harry M. Reid (D-Nev.) wouldn’t wait for the full caucus to sign off on the deal and that Reid’s rush led to the collapse.
Minority Leader Mitch McConnell (R-Ky.) also blasted a process that was designed, he said, only to stage “show-votes.”
Reid said that he would only file cloture on the Democratic plans now, with votes tomorrow. (Maybe they’ll figure out this time that the Senate cannot originate tax bills, and they’ll use a House shell bill or yesterday’s tax cut vote.) And Dick Durbin added, “allowing all of the tax cuts to expire is ‘not totally off the table’ now.” I think it’s off the table for the White House, but at least Durbin knows what the leverage is.
Meanwhile, the President’s team keeps inching closer to a deal, which is why Republicans can blow off a politically difficult vote that is essentially a giant tax cut for everyone.
Somewhere, George W. Bush and his cohorts are laughing, having necessarily planned this ten years ago when they instituted the tax cuts. In fact, that somewhere is the Daily Beast:
But in Washington, where anything beyond last week’s news cycle is considered ancient history, the jury-rigged nature of the Bush plan—and the fiscal sleight-of-hand involved—have been all but forgotten.
“We knew that, politically, once you get it into law, it becomes almost impossible to remove it,” says Dan Bartlett, Bush’s former communications director. “That’s not a bad legacy. The fact that we were able to lay the trap does feel pretty good, to tell you the truth.”
Sadly, it was not impossible to get rid of this. The public is still on the side of the Democratic plan. But they have so screwed up their leverage in this debate that you have to conclude they are deliberately sabotaging themselves. Here’s Barney Frank:
Rep. Barney Frank (D-Mass.), the chairman of the House Financial Services Committee, echoed liberal disappointment in President Obama’s negotiators for reportedly looking to cut a deal with Republicans on taxes that would allow a short-term extension of tax cuts for all income groups.
“I’m very disappointed in it. I think it’s gravely mistaken, and I’m sure my colleagues share that,” Frank said Thursday evening on MSNBC [...]
“I think it so undercuts their argument against unemployment compensation and their pretense that they care a lot about the deficit, they put deficit production behind helping wealthy people and also wasting money in the military and some of these efforts,” Frank said.
The idea, since the White House is undercutting the argument at every turn (because the President clearly doesn’t want to have raised taxes going into 2012), would to be to have the leadership say take it or leave it – either we pass the House tax cut plan, or nothing. What would happen in that case is that the Republican House would pass a permanent extension of the Bush-era rates on day one, and the pressure would build on the Senate and White House for a solution. But that’s where we are right now, anyway.
UPDATE: Joan McCarter writes:
According to a Senate aide, the votes will be on H.R. 4853 (the vehicle the House used for a tax cut extension for income up to $250,000), with a Baucus amendment that includes several additional items such as UI extension, AMT relief, estate tax, 1099 repeal, making work pay credit, and others. The second vote will be on the Schumer amendment raising the tax cut extension for up to the first $1 million in income, as well as the additional measures included in the Baucus amendment.
Those “additional items” didn’t come out of nowhere. That’s probably what’s up for discussion in those Geithner/Lew negotiations, which of course Baucus is a part of.