Thursday, December 15, 2011

Payroll tax cut and spending bill stall in Senate, raising threat of government shutdown

If there was any sign of progress, it was that Senate Democratic leaders met with President Obama on Wednesday at the White House to weigh whether to drop their demand that the $120 billion payroll tax cut be paid for with a new surtax on millionaires. - Washington Post

With a Friday deadline fast approaching, the threat of a shutdown grew more urgent as a separate omnibus spending bill remained stalled. House Republicans are pursuing a go-it-alone approach on the spending bill, essentially daring Democrats to vote against a deal — bringing closer the prospect of a shutdown at the end of the week, when a short-term funding measure expires.

Republicans also blocked Democratic efforts to vote on a payroll tax bill approved Tuesday by the GOP-led House that would link an extension to a series of Republican initiatives, including an attempt to accelerate the construction of a controversial oil pipeline from Canada to the Gulf Coast....

Republicans say bipartisan negotiators have reached a deal on the spending bill. But they say the White House and Reid will not allow a final vote on the measure, holding the bill hostage and threatening a shutdown to increase Democratic leverage on the payroll tax issue.

Once the spending bill passes, House members can go on their holiday break, leaving Senate Democrats with the unpleasant choice of accepting the House’s payroll tax bill, or rejecting it and taking the blame for allowing the tax break to expire.

House Republicans huddled for two hours late Wednesday to discuss whether to proceed with a vote on the spending bill, even without a Democratic sign-off.