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Democrats Scramble as Vote on Tax-Cut Package Is Delayed in House

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With less than two weeks until the Bush tax cuts are scheduled to expire, Democrats on Thursday pulled from the House floor the package negotiated between President Obama and Senate Republicans to temporarily extend current tax rates, while also extending unemployment benefits for 13 months. Despite the delay, a vote on the measure is expected late Thursday.

While Democrats had been reasonably confident Wednesday night that protests over the bill from their liberal wing could be overcome, House leaders stumbled going into a procedural vote to set the parameters of the tax-cut debate Thursday as it became unclear if they had the votes to pass that measure.

The bill moved swiftly through the Senate Wednesday, passing on a vote of 81 to 19. But progressive Democrats in the House remained defiant over what they said were unnecessary giveaways from the president to Republicans in the negotiating process, including extending income tax rates for high earners and setting the estate tax at 35 percent for estates' valued over $5 million.

As a result, the House Rules Committee agreed Wednesday night that the House would take up an amendment to modify the estate-tax piece of the package before the chamber voted on final passage of the overall tax-cut compromise Thursday afternoon.

The amendment, offered by Rep. Earl Pomeroy (D-N.D.), would set the estate tax at 45 percent, with an exemption of $3.5 million, just as the House voted to do in 2009. Pomeroy estimated that the change would affect 6,600 estates in 2011 and would cut $23 billion from the cost of the roughly $900 billion package over two years.

Republicans at the Rules Committee hearing Wednesday argued that the $3.5 million threshold would still subject family farms and businesses to liquidation if the owner dies and his or her children cannot pay the taxes on the estate.

A senior House Democratic aide tells Politics Daily said that "a loud handful of members" did not want to be forced to vote for the underlying legislation -- the Senate-passed bill -- in order to vote for the Pomeroy amendment, as the Rules Committee outlined. "Those members are very angry and would be willing to have this go into January or February," the aide said, describing a scenario senior Democrats and the White House want to avoid.

House Democratic leaders regrouped Thursday afternoon to devise a process that liberal Democrats could support and allow the to pass bill this week, with or without the Pomeroy amendment. To that end, House Speaker Nancy Pelosi huddled with fellow Democrats Thursday afternoon, first on the House floor and then in a hastily scheduled caucus meeting, to find a way forward for the legislation.

After the caucus meeting, which Rep. Louise Slaughter called "raucus," the House resumed debate on the bill and the Pomeroy amendment just before 6:00 Thursday night.

If the House does approve changes to the Senate-passed bill, it could threaten the future of the entire package. Congressional rules call for the amended bill to go back to the Senate for approval, where Republican senators have already said they are not interested in renegotiating the deal they struck with the president.

Senate Minority Leader Mitch McConnell warned Wednesday that any changed to the package in the House could unravel the deal entirely.

"Now it's up to our colleagues in the House, and we urge Democrat leaders to resist playing political games and making partisan changes so that American taxpayers won't be hit with a huge, job-killing tax hike on January 1," McConnell said.

But angering Republican senators is a risk Pomeroy said he was willing to take.

"Would they have taxes go up on everyone just because they want to take care of that wealthy, that little estate-tax exclusion exposure for the wealthiest 6,600 families in this country?" Pomeroy said Wednesday in an interview with PBS's "NewsHour." "We think that we improve the package by making the amendment in order and approved."

Speaking from the White House Wednesday, the president urged lawmakers not to delay the bill any further.

"I know there are different aspects of this plan to which members of Congress on both sides of the aisle object," he said. "That's the nature of compromise. But we worked hard to negotiate an agreement that's a win for middle-class families and a win for our economy, and we can't afford to let it fall victim to either delay or defeat."
Filed Under: The Capitolist

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36 Comments

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Rob & Kathy

dajt5712:04 AM Dec 17, 2010
let the temporary tax cuts that never worked expire. adding 800 billion to the deficit is not good.
*****************
You didn't say that when they passed the $800 billion "stimulus" bill..

December 17 2010 at 8:56 PM Report abuse +4 rate up rate down Reply
pat70230

Would someone explain to me why you think that everyone with an estate is RICH? Do you not know that the Death Tax effects people with farms and family businesses? Farm land will be evaluated not as farm land but on its future use. A family business that someone worked years to establish hoping to leave to their children will be gone because of high estate taxes. The super rich have already set their estates up so that they avoil a lot of the estate tax. And by the way, what's wrong with having money? When I was growing up, we all wanted do be rich. It's not the money, it's what you do with it.

December 17 2010 at 6:18 AM Report abuse +8 rate up rate down Reply
1 reply to pat70230's comment
jandtstarr

There's nothing wrong with being rich if you pay your fair share. The tax loopholes for the rich are unfair to the middle class who have to pay their 10 or 15%. The rich write it off and pay nothing. The country suffers and they get richer and the middle class gets poorer. It can't keep going on like that.

January 04 2011 at 4:00 PM Report abuse +1 rate up rate down Reply
R2SO1

Checks and balances at it's worst ...political football at the expense of the American people ...congress should be ashamed

December 17 2010 at 1:41 AM Report abuse +7 rate up rate down Reply
1 reply to R2SO1's comment
jasonsmokinj7

I agree

December 29 2010 at 5:46 PM Report abuse rate up rate down Reply
Joy

With so many diverse opinions among Americans -- whether or not they are well-informed, knowledgeable opinions -- it should not surprise us that our elected officials reflect a wide range of opinions. "Washington" will not change because we, the people, and our form of government, will never change. Get used to it, or move to another country. A benevolent dictatorship is the most efficient form of government, but good luck finding one. As for me, I'll stick with the USA, where our form of government is not perfect but still better than any other type of government ever devised.

December 17 2010 at 12:54 AM Report abuse +3 rate up rate down Reply
TONY

Not a bum but come to Clarksville, TN and find a job, good luck, not drawing nothing my unemployment benefits ran out about 3 weeks ago and have been only unemployed since the end of June. So, no money at all coming in and have bills and a house payment, you sorry bastards in government have a job and are paying your bills. Quit crying when things don't go one way or another, it's not Democrat or Republican it's the people! Who mean nothing anymore.

December 17 2010 at 12:12 AM Report abuse +2 rate up rate down Reply
Steven Felix

Say NO to the dream act and anything else harry reid wants passed.

December 17 2010 at 12:00 AM Report abuse +9 rate up rate down Reply
inclineman

Let it run out! It will move us closer to balancing the budget which everyone gives 'lip' service to but does nothing about. I guarantee you...it will be very tough on the middle class and poor...and might get the attention of the wealthy...but maybe this is what needs to happen.

December 16 2010 at 11:44 PM Report abuse +2 rate up rate down Reply
puffnbuster

It would be nice if they just pass the negotiated package now and then sit down when congress conviens again and really really think about the tax credits/breaks/increases for the average American family. Take time to think and listen to the American people for a change. Then put together another package with a little give and take for both sides and NO PORK~~ Just once it would be nice to see that the people we elect really can think and do care about all of us.

December 16 2010 at 11:14 PM Report abuse +28 rate up rate down Reply
Brent

Republicans have no shame. Stick up for rich, make laws for the rich, deregulate the rich, cave into rich lobbyists, deregulate banks, deregulate big coal, deregulate big oil, sleep with Wall Street. This new bunch coming in will fall into the same crap, tea party/republican same thing, no difference. Still the party no. Regardless of what the President puts out there, Republicans are against it, even if they themselves were the ones originally proposed it. Democrats are no different. Half of them were for the estate tax which holds no benefit but for the super rich. Washington is a joke.

December 16 2010 at 11:12 PM Report abuse -21 rate up rate down Reply
jimjdb5591

1. get rid of the earmarks
2. Extend the unemployment benefits but make it recoverable like welfare. I.E re-payable even if property has to be liened.
3. Re-vamp the tax code. You want "fairness" then everybody pays, unlike the 55 percent that now pay NOTHING

December 16 2010 at 11:00 PM Report abuse +25 rate up rate down Reply
1 reply to jimjdb5591's comment
suh joo young

yeah i think earmarks should be illegal and brought up in a seprate bill standing alone..imagine debating if we should fund a 10 million dollar study of rat poop in california.LOL it will be voted down. the tax code can go 2 ways everyone pays 10% on payroll onlt everything else is tax exempted ..and i do me everyone from people that make $800 a month to people that make $100,000 a day. or they have the fair tax which all the taxes that you will ever pay is in products you buy and you want get taxed again if you say sell your car or your nana dies and leave you the house. well you already pay for unemployment when you work so paying it back is free money for the govt since you already paid in to it..you should only get the amount you aka your company has paid into it nothing more or less.

December 16 2010 at 11:49 PM Report abuse +6 rate up rate down Reply

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