The House just passed the rule for debate on the tax cut bill, by the count of 214-201. This rule was pulled from the floor earlier today, but that was apparently due to a large kabuki dance by liberal Democrats. They wanted to be able to vote against the underlying bill even if their amendment to the estate tax provision passes. There’s pretty much no chance that the amendment will pass, so it’s kind of a moot point. But the House liberals insisted, so they got an amendment to the rule to change that up, which passed by a count of 230-186. Liberals apparently asked for other changes to the rule, like more amendments, but didn’t get them.
Three hours of debate are expected for the bill, and then two votes – one, the aforementioned amendment to change the estate tax provisions of the bill, and two, the vote on the bill itself. It’s almost certain that the House will pass the same exact version of the bill as the Senate later on tonight. The Congress can work quickly when they want to.
The bill will extend all the Bush tax cuts for two years, add an employee-side 2% cut to the payroll tax (about 1/3 of the employee responsibility), bring back the estate tax at a 35% level for estates over $5 million for two years, extend unemployment benefits for 13 months, enact a series of small business tax provisions on bonus depreciation and R&D, and extend a slew of other small tax breaks, including one for ethanol producers. All in all, the bill will cost $857 billion dollars over a two-year period. It will effectively raise taxes on 1 in 3 workers, those at the poorest end of the income scale making under $20,000 a year (or $40,000 for households), and will give a $139,000 tax cut to every millionaire in America. Many are also concerned that reducing the payroll tax cut will give conservatives an avenue to further call into question the long-term finances of Social Security and make major changes to the program.
The bill is almost certain to be accompanied down the road by major spending cuts, either in conjunction with the Fiscal Year 2012 budget or a vote on raising the debt limit. Republicans, having starved the government of tax revenue, will seek to shrink government and cut spending on the most vulnerable Americans. This has been their modus operandi for thirty years. A strongly Democratic Congress and a Democratic President will help them usher it in.
I hope the “stimulus” is worth it, or at least that which doesn’t get canceled out by spending cuts in short order.
UPDATE: HuffPost Hill is claiming that the estate tax amendment will be a tight vote. I’m just not seeing it. Bear in mind that, if the estate tax amendment does miraculously pass, it basically screws up the entire deal. Republicans will bolt on final passage, the whole thing would have to go back to the Senate, and there will be much wringing of hands.