Political News

Payroll tax deadlock ends with voters perturbed

Posted December 22, 2011

— After House Republicans caved to demands by President Barack Obama, congressional Democrats and fellow Republicans Thursday to approve short-term renewal of payroll tax cuts for all workers, both politicians and those they represent agreed that the stalemate and its solution were examples of the partisan bickering that has come to characterize Congress in recent years.

"It is an election year coming up, so there is a lot of posturing," said David McClennan, professor of political science at Raleigh's William Peace University.

Even Speaker John Boehner acknowledged the Republican hold out for a longer-term solution "may not have been politically the smartest thing in the world."

The Ohio Republican abruptly changed course Thursday afternoon and dropped demands for immediate holiday season talks with the Senate on a full-year measure that all sides said they want. Senate leaders had insisted on the two-month extension to buy time for talks next year.

The House and Senate plan to act on the two-month extension Friday.

Partisan battle eases -- for now Partisan battle eases -- for now

House Republicans were under fire from their constituents and GOP establishment figures incensed that they would risk losing the tax cut issue to Democrats at the dawn of the 2012 presidential and congressional election year. House GOP arguments about the legislative process and the "uncertainty" a two-month extension would mean for business were unpersuasive.

Pam Andes, owner of United Pest Management, was relieved to hear about even a short-term extension. 

"We are paying a lot in payroll taxes, and we would have to cut hours on our guys if our taxes go to high," she said as she watched her children ice skate in downtown Raleigh Thursday evening.

The compromise legislation would renew the tax break through Feb. 29, along with jobless benefits and a "fix" to prevent doctors from absorbing a big cut in Medicare payments. Its $33 billion cost would be covered by an increased fee on mortgages backed by Fannie Mae, and Freddie Mac.

Raleigh resident Chris Moody was disappointed – both with the outcome and the partisanship that preceded it.

"I can not imagine it any worse," he said. "The government spends way too much money, and the tax code is a mess."

McClennan said communication in Washington is also a mess.

"I think it is causing most Americans to shake their heads and say, 'Hold on. They are mesing with my paycheck," he said.

The developments were a clear win for Obama. The payroll tax cut was the centerpiece of his three-month campaign-style drive for jobs legislation that seems to have contributed to an uptick in his poll numbers — and taken a toll on those of congressional Republicans.

"Because of this agreement, every working American will keep his or her tax cut - about $1,000 for the average family," Obama said in a statement. "That's about $40 in every paycheck. And when Congress returns, I urge them to keep working to reach an agreement that will extend this tax cut and unemployment insurance for all of 2012 without drama or delay."

If the cuts had expired as scheduled, 160 million workers would have seen a 2 percentage point increase in their Social Security taxes. And up to 2 million people without jobs for six months would start losing unemployment benefits averaging $300 a week.

Obama, Republicans and congressional Democrats all said they preferred a one-year extension but the politics of achieving that eluded them.

McClennan said communication is the only way to get to agreement.

"They work in the same town. It is not hard to talk," he said.

All parties have pledged to start working on that in January. McClennan worries that the 2012 elections mean the posturing won't quiet down for yet another calendar year.


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  • Ezekiel c23 v19to20 Dec 23, 2011

    Hush now, cvdurhm! You know that documentation and facts confuse them!

  • wral mods blow close my account Dec 23, 2011

    Bill this is simply not true.

    "the 50% who pay no taxes" - Billfisher

    Only 18% pay no taxes and they earn less than 18K or are elderly.


  • Ezekiel c23 v19to20 Dec 23, 2011

    "I feel like I need to apologize to my grandchildren "

    Just as our Grandparents shoud be apologizing to us. It's nothing new really.

  • 3forme Dec 23, 2011

    very sad that so many people keep voting for people who have never listened and never will. I feel like I need to apologize to my grandchildren now for what we are going to leave them..We should be ashamed of this mess.

  • Ezekiel c23 v19to20 Dec 23, 2011

    "If you can't beat 'em join 'em"

    well, since we are never going to beat the terrorists...hye, that explains the RW world view! Things are suddenly so clear now!

  • Ezekiel c23 v19to20 Dec 23, 2011

    "Why do you people hate the rich so much?"

    Why do you hate the Middle Class, the poor, and the United States so much?

    "They are the ones who bear the financial burden of the large majority of your social programs."

    As well they should. Hopefully one day I will be one of them.

    "The 1%, who you hate so vigerously,"

    Useless BS talking point.

    "account for over 50% of the tax revenues collected so that the 50% who pay no taxes can collect all of their government assistance."

    Considering how much of it they own...

    "Just a valid opinion on the subject."

    Totally invalid actually. If it were anything more than talking point maybe it would be more so.

  • Ezekiel c23 v19to20 Dec 23, 2011

    "The responsible ones who know how to take care of themselves will not have to take any. You're right, it is that simple"

    so don't take it tehn. Send the money back to Uncle Sam and tell him thanks but no thanks.

  • Billfisher Dec 23, 2011

    neither can any of the people hiding behind that corporate shield!

    Then why not incorporate yourself, it's easier than you think. Spend $300 and talk to a tax accountant for an hour and a tax attorney for an hour. It's the best $300 you will ever spend. If you can't beat 'em join 'em

  • snshine62d Dec 23, 2011

    Yeah but why wait? It's a political strategy. If he can make the GOP look bad now, and get a few up ticks in his ratings, then he can do it again, and again and again"

    Nobody has to do anything to make the GOP look bad, their doing a good enough job by themselves.

  • Barely Dec 23, 2011

    Just a little background info for the people who want term limits (I could care less either way): The reason there are no limits to how many times a person can serve in congress is due to a basis on the parlament in England. The founders of the US wanted more stability among politicians serving. However, they left it open for Americans to be able to make rules and set term limits by ammending the Constitution. One can assume that our founding fathers thought we would be intelligent enough to vote out anyone who wasn't properly representing the people. Another fun fact: In ancient Greece, representatives for many of the city-states were rotated out annually.