Further payroll tax relief may have to wait. Most Americans who have been following the story probably thought a two-month extension of the payroll tax cut was the best that could be arranged for now and it was a done deal. In fact, after the Senate approved the measure on Saturday, they left Washington for their holiday break. But not so fast — it still had to get past the House in today’s vote . . . and it didn’t.
Today the House voted 229-193 in opposition to the two-month extension. This has the effect of kicking the measure back to the Senate, but Senate Majority Leader, Harry Reid, refuses to continue negotiations on a long-term deal until the House approves the preliminary one. Here is the way he spins it:
I have been trying to negotiate a yearlong extension with Republicans for weeks, and I am happy to continue doing so as soon as the House of Representatives passes the bipartisan compromise to protect middle-class families, but not before then.
~ Senate Majority leader Harry Reid, D-Nev
If something isn’t done before the end of the year, then the payroll taxes will go up by 2 percentage points in January and nearly 2 million people could lose unemployment benefits.