Deal Reached on Payroll, Unemployment and “Doc Fix”

Congressional leaders have apparently reached a deal to extend the payroll tax cut extension through December, extend unemployment benefits and prevent Medicare payments to doctors from being slashed.

The deal comes after House Republicans prepared to move a standalone extension of the tax cuts. That changed the dynamic in two ways. First, President Obama and his allies became nervous about the fate of unemployment insurance benefits if they were not tied to the tax portion. Second, the insistence on “paying for” the extension of a tax cut (i.e., stopping a tax increase) waned. Why? Because allowing Americans to keep more of their own money shouldn’t be offset, because that wasn’t the government’s money to begin with.

Much of the gridlock surrounding the payroll tax cut extension came because Democrat negotiators insisted on preventing a tax hike by implementing a different tax hike.

On Monday, we released a statement praising the desire to proceed with a standalone payroll tax extension. We followed up on Tuesday with an Op-Ed:

“Instead of allowing an extension of the payroll tax cut to languish in a conference committee infested with obstinate Democrats who are demanding job-destroying tax hikes as a ‘pay for,’ they decided to bring forward a clean extension that will run for the remainder of the year.

“While Heritage Action has not been shy in our disagreements with House leaders on certain issues, we can say unequivocally that this is the right move. Democrats on the conference committee were not genuine negotiating partners. They simply desired bi-monthly fights on the tax cut from now until the elections.

“Doing this kabuki dance every two months is bad politics and absolutely terrible policy.”

Please Share Your Thoughts