CQ TODAY ONLINE NEWS
Oct. 7, 2011 – 10:25 p.m.
Senate to Give Jobs Bill Its First Test
By Sam Goldfarb, CQ Staff
The Senate plans to vote this week on a Democratic jobs package that has little chance of becoming law but will provide a focal point for a political battle over economic strategy.
Nearly a month has passed since President Obama sent Congress a $447 billion package of tax cuts and new spending (
More significant than this week’s vote totals may be the tenor of the Senate debate and whether it suggests that lawmakers have some sort of ultimate compromise in mind rather than just campaign talking points.
Senate Democrats have already backed away from Obama’s plan to raise taxes on couples making more than $250,000, opting instead to cover the cost of jobs programs with a 5.6 percent surtax on household income above $1 million.
Republicans have criticized Obama’s proposal as another round of wasteful stimulus spending. But GOP lawmakers may have a hard time voting against one major provision: an extension and expansion of the current Social Security payroll tax reduction.
Legislative action on the president’s proposal will play out against a background of a weak labor market. Numbers released by the Labor Department on Oct. 7 showed that hiring remains relatively slow and the national unemployment rate is holding steady at 9.1 percent.
There have been no recent developments to suggest that a legislative agreement is in the works. Their cordial summer golf outing a distant memory, the top Democrat and Republican in Washington traded rhetorical jabs last week, each questioning the other’s motives.
At about the same time that Obama, during his Oct. 6 news conference, was accusing Republican leaders of “games-playing” in an effort “to score political points rather than actually get something done,” House Speaker
Both men suggested that the summer fight over increasing the debt limit and their inability to reach a “grand bargain” for reducing the budget deficit has soured the political climate. Neither indicated much of an appetite for another round of high-level negotiations.
Senate Speed Bump
Obama has been flying around the country, demanding quick congressional action on his jobs package. Senate Majority Leader
But in the lead-up to the jobs debate, the Senate at least temporarily broke down on Oct. 6, as it moved toward passage of a bill intended to punish China for manipulating its currency (
Senate to Give Jobs Bill Its First Test
From a practical standpoint, the arcane procedural fracas delayed final action on the China currency bill until Tuesday evening. The Senate will probably vote then on a motion to limit debate on formally taking up Obama’s bill.
The outcome of that vote is uncertain, and it could be affected by fallout from last week’s floor fight. Although Reid has promised to allow a lengthy debate on the jobs measure and an open amendment process, that scenario is no longer guaranteed. If Republicans conclude that they will be able to offer few, if any, amendments, they are even less likely to help Reid muster the 60 votes needed to limit debate.
Looking for a Third Way
Even if the Senate does vote to take up the jobs bill, the two parties are likely to use the debate to air out their differences rather than move closer together.
Republicans, for instance, are considering a substitute amendment based on a plan offered earlier this year by Sen.
Notably, the Portman plan is also quite different from what Republicans offered as an alternative to Obama’s 2009 stimulus package (PL 111-5). Then, the GOP jobs plan included cutting the 6.2 percent Social Security payroll tax paid by employees. A reduction from 6.2 percent to 4.2 percent was enacted, and the extension of that tax cut is the centerpiece of Obama’s latest jobs bill.
The fact that more than half the cost of Obama’s jobs bill is the result of proposed tax cuts, and that Republicans have previously supported payroll tax reductions, has encouraged speculation that the two parties might at least agree to extend the current 2 percent payroll tax cut for employees that expires at the end of the year.
Hoping to promote that outcome,
The Massachusetts Republican, though, did not offer a way to pay for those provisions. At the moment, lawmakers appear to be in no mood to consider legislation that would add to the deficit.
That could change, particularly if the economy fails to improve and the year-end expiration of current stimulus measures, including the payroll tax cut and some unemployment benefits, approaches.
Congress could also be more willing to act on jobs measures if the joint deficit committee manages to reach a deal by November that helps ease long-term fiscal concerns.