WASHINGTON – Careening toward a politically toxic tax hike, President Barack Obama implored House Speaker John Boehner on Wednesday to get behind a two-month stopgap until a longer deal could be struck early next year, calling it the only real way out of a mess that is threatening the paychecks of 160 million workers and isolating House Republicans.
In a weary Washington, the outreach accomplished little. All sides seemed to end the day where they began, with heavy political and economic consequences at stake.
Boehner remained insistent on a full-year extension of the existing payroll tax cut before Jan. 1, urging Obama to haul Senate Democrats back to town to talk to his chosen negotiators. “Let’s get this done today,” Boehner told Obama, according to a speaker’s aide.
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But the Capitol was emptying out fast, and the Senate showed no inclination to return, having already passed a bipartisan two-month tax cut it thought had settled the matter.
For taxpayers, and for an economy starting to show some life again, the standoff was all holiday gloom.
Barring any action by Congress, Social Security payroll taxes will go up almost $20 a week for a worker making a $50,000 salary – that’s $40 less for a typical paycheck or $1,000 over the whole year. Almost 2 million people would lose unemployment benefits as well.
The political risks seemed only to deepen, too, particularly for House Republicans. They appeared poised to take the biggest blame for a tax increase even while pushing for a deeper one.
The reliably conservative editorial page of The Wall Street Journal blasted both Boehner and Sen. Mitch McConnell, the GOP leader, for how they handled the matter. “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,” the paper’s editorial said.
In a year of legislative brinksmanship remarkable even by Washington standards, the latest fight spilled into the lap of Republican candidates running for president.
Former House Speaker Newt Gingrich chastised Congress, particularly the Senate, for failing to extend the 2 percentage point tax cut for a full year.
“They can’t figure out how to pass a one-year extension, so the Senate leaves town?” Gingrich remarked while campaigning in Iowa. “It’s an absurd dereliction of duty.”
Rival Mitt Romney refused to take a position, again steering clear of Washington’s hot policy debate.
“I’m not going to get into the back-and-forth on the congressional sausage-making process,” the former Massachusetts governor told reporters after events in New Hampshire. “I hope they’re able to sit down and work out a solution that works for the American people.”
But the White House made clear the time for talks were over for this year.
“The negotiating has happened already,” presidential spokesman Jay Carney said, referring to the Senate bill the White House insists was sealed with Boehner’s blessing.
Boehner disputes that he ever gave a nod of support to the two-month tax cut that many in his caucus oppose.
He and other House members call it a poor and unworkable tax policy.
Obama: 2-Month Tax Deal the Only OptionBoehner Insists On Senate DiscussionsSee OBAMA on PAGE A2from PAGE A1Obama: Two-Month Deal Is Only Optionevan vucci/the associated pressHouse Speaker John Boehner, R-Ohio, second from left, holds a meeting on the payroll tax cut extension Wednesday.Tax cut extensionNew Mexico’s delegation and candidates speak up C2
Obama to Boehner: Two-month tax cut only option