Bipartisanship Still Alive in Congress?

Johnson, Democratic colleague promote bipartisanship at town-hall meeting
(Tim Mitchell, Champaign News-Gazette, October 16, 2011)

Christopher Murphy and Tim Johnson may belong to opposing political parties, but the two Congressmen agree that cooperation between Republicans and Democrats is needed for the common good of the country if Congress is ever going to be able to overcome gridlock.

"In Washington, nothing can get done without the two parties working together," said Murphy a Democrat from Connecticut. "This economy, with the misery that comes with it, affects everybody, whether you are registered as a Republican or registered as a Democrat."

"Not all Democrats and not all Republicans believe the other party is evil. I don't," said the Republican Johnson of Urbana. "I believe Republicans, Democrats and independents all have to work together for the common solutions to America's problems, and anything less than that is unacceptable."

Murphy and Johnson spoke to more than 100 people who turned out Sunday afternoon for a town-hall meeting at the I Hotel in Champaign.

Both men are members of the Center Aisle Caucus, a group of members of Congress that work to bring the two political parties together to create a consensus where tough decisions can be worked out.

Johnson helped found the caucus, and Murphy is one of its leaders. The two men agreed to take part in town-hall meetings in each other's districts to demonstrate dialogue and cooperation between parties.

"Washington would work together better if the two parties just talked to each other. Tim and I are trying to set an example for our colleagues," Murphy said. "We need to think creatively about how to break the culture of dysfunction in Washington. If you are serious about Washington, you have to be serious about reaching out across the aisle."

Johnson said the people of central Illinois have been telling him that politicians need to learn to get along.

"More than ever, there is a tremendous belief that government at all levels is out of control. The dysfunctionality, the anger, the bickering and the unwillingness to work together have reached monumental proportions, and we need to do something about it."

US Deficit Panel To Get Briefing on Gang of 6 Deficit Cut Plan
(John Shaw, Market News International, October 19, 2011)

With a deadline approaching and partisan gridlock deepening on Capitol Hill, Congress's new deficit reduction panel will receive a briefing Wednesday from the members of a bipartisan group of senators who have developed a far-reaching deficit reduction plan.

The Senate's so-called "Gang of Six" will brief the Joint Select Committee on deficit reduction in a private session.

The "Gang of Six" is comprised of Democratic senators Kent Conrad, Dick Durbin and Mark Warner and Republican senators Tom Coburn, Mike Crapo and Saxby Chambliss.

In the early months of this year, the "Gang of Six" tried to transform the main elements of the 2010 Simpson-Bowles deficit report into legislative language.

In July, after lengthy deliberations, the group issued a more general plan that called for about $4 trillion in ten year savings by reducing spending, raising revenues and reforming some entitlements.

The plan, which was introduced during the final weeks of the debt ceiling battle, has languished.

The "Gang of Six" plan calls for Congress to enact $500 billion of immediate deficit reduction and then charges various congressional committees to meet specific savings targets within six months.

It endorsed a shift to the chained CPI for indexing government benefits starting in 2012, but allowed for some exemptions.

The "Gang of Six" offered a number of tax-related proposals. It called for eliminating a number of tax expenditures and reducing individual tax rates by establishing three brackets with rates of 8-12%, 14-22% and 23-29%.

The plan endorsed the creation of a single corporate tax rate of between 23% and 29%.

The Senate group said that tax reform which is carefully crafted could provide $1 trillion in additional revenue.

Congress's Joint Select Committee on Deficit Reduction is charged to submit a report to Congress by Nov. 23, 2011 that reduces the deficit by between $1.2 trillion and $1.5 trillion for the 2012 and 2021 period.

The final package, if one is agreed to by the majority of the panel's 12 members, must be voted on without amendment by the House and Senate by Dec. 23, 2011.

If the panel fails to agree on a spending cut package or Congress rejects its plan, a budget enforcement trigger would secure $1.2 trillion in budget savings through across-the-board cuts.

The cuts would be equally divided between defense and non-defense programs but would exempt Social Security, Medicaid and low-income programs.

The panel has held three public hearings: its organizational meeting on Sept. 8, a budget overview hearing on Sept. 13 with Congressional Budget Office Director Doug Elmendorf and a revenue overview on Sept. 22 with Thomas Barthold, the chief of staff of Congress's Joint Tax Committee.

In the last several weeks, the 12-person panel has been meeting several times a week in often lengthy private sessions. Members have left those sessions tight-lipped, saying nothing that might provide a hint about where the panel is headed.

Some Republican members of the panel, such as Sen. Jon Kyl, have said the panel should focus on achieving the $1.2 trillion to $1.5 trillion deficit cutting goal.

Some lawmakers and outside groups have urged the panel to come up with a $4 trillion deficit reduction plan over 10 years.

Analysts have said that the deficit reduction panel needs to submit its recommendations to the Congressional Budget Office by early November so the CBO can score the package by Nov. 23.

Welch Working With Bipartisan Group On Budget Deficit Deal
(Transcript from Vermont Public Radio, October 19, 2011)

(Host) Congressman Peter Welch is working to put together a bipartisan coalition of House members to support a budget deficit deal that will include new tax revenues and some changes to entitlement programs.

Welch says the group is trying to reduce the deficit by at least $4 trillion over the next 10 years.

VPR's Bob Kinzel reports:

(Kinzel) A special Congressional super committee faces a deadline of Thanksgiving to come up with a plan to reduce the federal budget deficit by just over $1 trillion over the next 10 years.

If the committee fails to reach agreement on a plan, or if Congress fails to pass it, automatic cuts will go into place and military spending will take the biggest hit.

A number of Republicans in Congress say they'll oppose efforts to raise new revenue as part of the plan and many Democrats say they'll oppose efforts to reform entitlement programs including Medicare, Medicaid and Social Security.

Congressman Peter Welch told members of the Montpelier Rotary that he's part of a bipartisan group of House members who think any final solution must include both approaches.

(Welch) "We're asking this super committee to go big and go bold to go for $4 trillion and obviously that requires that everything be on the table. So there are a lot of us who are pushing for that...if you approach this as a practical problem to be solved rather than an ideological battle to be won well then you can solve it."

(Kinzel) Welch says it isn't going to be easy for Republicans in this group to buck their leadership on the issue of new revenue.

(Welch) "The break through here is that some of the Republicans who will sign this, it's not finalized yet, but they're acknowledging that revenues have to be on the table. All of us on the Democratic side are acknowledging that all the spending has to be on the table. That means reforms in even the entitlement programs."

(Kinzel) And Welch admits that it's going to be hard to ask Democrats to accept reforms to important entitlement programs.

(Welch) "I say that as a person who's a strong defender of Medicare, a strong supporter of Social Security. But if you're a strong defender and there's ways to improve it, to make it more sustainable, I feel that I have the major responsibility as your representative to search and fight for those ways to do that."

(Kinzel) Welch expects to release the names of the House members who are committed to this approach sometime next week.

Smoke signals from the super-secret committee
(By Katy O'Donnell, National Journal, October 21, 2011)

We may know the members' names, but for all intents and purposes, the Joint Select Committee on Deficit Reduction operates more like a college secret society than a congressional committee.

Members schedule meetings at the last minute without putting the agenda in writing; try to dodge bystanders (in this case, reporters) on their way in; and feign ignorance when asked what they've been up to. There's no secret handshake or tattoo -- that we know of -- but at this point it's not all that difficult to imagine them starting each meeting with a chant of some sort.

The super committee's Nov. 23 deadline is fast approaching, but few signs of actual progress have emerged -- just rampant rumors of discord and nebulous comments from panel members.

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Sen. Dean Heller, R-Nev., has voiced fears that the lack of public access to the committee could allow it to be unduly swayed by lobbyists. And Rep. Maxine Waters, D-Calif., went so far as to propose a bill eliminating the committee altogether.

"How can 12 people decide the fate of millions of Americans behind closed doors with little to no input from Congress or the average citizen?" Waters said when she unveiled the bill last week.

Members of the bipartisan Gang of Six emerged from a closed-door meeting with the committee on Wednesday morning tightlipped.

Sen. Kent Conrad, D-N.D., who became a kind of spokesman for the gang this summer -- always eager to discuss pressing deficit problems and possible solutions -- wouldn't comment other than to say the group discussed its plan with the committee.

The gang's plan, produced this summer, included broad tax reform that would lower individual marginal rates while bringing in some $1.5 trillion in additional revenue over 10 years, as well as reforms to Medicare and Social Security. In other words, Conrad admitted to speaking with the committee about the ideas that he'd already presented to nearly 50 senators and that budget-watchers in Washington have long speculated would form the meat of the committee's discussion.

"I think it would be inappropriate for me to say any more," Conrad said. "We've been asked to respect the deliberations of the committee. And I certainly do respect them."

It's not just that the committee's members are wary of their guests or the press. The panel imposed a one-aide-per-member limit (not including committee staff) on its closed-door discussions earlier this month, and the sight of aides filing out of the room to wait in the hallway for half an hour before going back in is not unusual.

One problem, according to a Hill staffer, is that members themselves are asking the CBO to score various proposals without including their staffers in the request - causing havoc as the CBO is forced to follow up on every question it has with a busy lawmaker rather than a legislative aide or policy wonk.

The crackdown on the number of people allowed in was spurred, aides said, by growing concern over leaks. In a kind of daily witch hunt, whenever an article about the committee is published, staffers call or e-mail around to try to figure out who leaked.

Leaks? Most stories about the super committee have been of the "almost certainly" variety, fueled with speculation about what could be going on.

But there's plenty of time to get a "no comment" from the members, given both the frequency of meetings and the fact that the media stakeout at the most common meeting place is right next to restrooms, allowing for several false alarms - lights up, cameras swiveling, reporters flipping on recorders -- during each hours-long gathering.

Some reporters have ventured inside the room after meetings to see if any paperwork has been left behind, only to find that the room in the basement of the Capitol Visitors Center has become a kind of situation room, wiped clean after each use. (It's unclear whether burn bags have been brought in.)

The group has only held two public policy hearings. Its third, on discretionary spending, comes next week. But if the charade of public hearings is actually supposed to demonstrate the committee's real work, the group may want to consider varying its witness list.

Congressional Budget Office Director Douglas Elmendorf, the sole witness at the first hearing, will testify again at the third. The second hearing saw testimony from Joint Committee on Taxation Chief of Staff Thomas Barthold, who -- as several members pointed out when Sen. John Kerry, D-Mass., tried to get Barthold to answer a question in greater depth -- is in fact a government employee who can answer the committee members' questions at any time, regardless of hearings.

The unofficial deadline to submit a package, aides and Elmendorf have agreed, is at the end of the month, in order to give the CBO time to score it. But for now, the committee continues to resemble Skull and Bones more than the most important congressional committee in town. In fact, it's not unusual to see 12 members enter the room and nine leave. Who knows, maybe there's even a secret exit.

$4 Trillion Deficit Deal Possible: Lawmakers
(By James Rowley and Brian Faler - Bloomberg News - Nov 4, 2011)

A $4 trillion deficit-reduction deal is possible, say two influential lawmakers, one a Democrat and one a Republican, with both saying they’re willing to compromise over their previous positions on spending and taxes.

Representative Xavier Becerra, a California Democrat who last year voted against a plan put forth by President Barack Obama’s debt commission, said this time he’s prepared to back something close to it as long as about one-third of the plan includes higher revenue.

A “balanced” plan is “something that Americans can look at and feel it and say, ‘You know what, I think I gave -- put a little bit of skin in the game, but so did so-and-so,’” Becerra, a member of a congressional deficit-reduction supercommittee, said in an interview on Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend.

Representative Mike Simpson, an Idaho Republican who sits on the House Budget Committee, said he’s willing to accept tax increases as part of a major deficit-reduction package.

Simpson, also speaking on “Political Capital,” said he favors a plan cutting between $4 trillion and $6 trillion over the next decade and that while he’s “personally, fine” with $3 in spending cuts for every $1 in new revenue, he might consider a lower ratio.

“You can’t do it with just entitlement reform, you can’t do it with just discretionary spending and you can’t do it with just tax increases,” said Simpson. “You need all of those on the table.”

Becerra said a 3-to-1 ratio of spending cuts to new revenue, “is not balanced,” while signaling he might be receptive to a 2-to-1 ratio. “Show me the two and the other one,” he said.

On spending for entitlements such as Medicare or Social Security, both Becerra and Simpson said those programs are part of the deficit-reduction discussion.

Simpson said the supercommittee should tackle Social Security as well as Medicare, saying “if we don’t do something, they won’t be here for future generations.”

Becerra declined to give specifics on what he would cut, saying “it would be wrong” to “protect this particular interest,” because “everything should be on the table.”

Democrats have balked at cutting entitlements without revenue increases, and Republicans want what House Speaker John Boehner calls “real reform” of those programs before they agree to any revenue increases.

Last year’s debt commission, led by former Republican Senator Alan Simpson and Erskine Bowles, who was President Bill Clinton’s chief of staff, debated a plan that would have cut three times as much spending as it raised in new revenue, if reduced interest payments on the debt are included in the cuts.

The $3.9 trillion, 10-year Simpson-Bowles plan envisioned about $2.2 trillion in spending cuts, $673 billion in reduced interest payments, and $1 trillion in tax increases.

Becerra said that while he opposed the commission’s recommendation last year, it could be “the ultimate template that we use for a solution” in the supercommittee.

Becerra, 53, the vice chairman of the House Democratic Caucus, is one of three House Democrats on the 12-member supercommittee, equally composed of lawmakers of both parties and both legislative chambers of Congress. The panel must find at least $1.2 trillion in deficit cuts.

Both he and Simpson dismissed that figure as insufficient.

“We can get it done in ways that are not just $1.2 trillion worth of savings. We could make it big,” Becerra said. “Big and bold.”

Simpson said the $1.2 trillion in savings “just kicks the can down the road.”

A plan to promote short-term jobs growth “should be part of this,” Becerra said. More jobs will produce more tax revenue, further helping cut the deficit, he said. “You’ve got to make the economy work before you can really expect to get the deficits down and get us back to balance,” he said.

Simpson said it’s possible to combine long-term deficit reduction with short-term job creation.

Boehner, an Ohio Republican, told reporters yesterday that jobs legislation is outside the supercommittee’s mandate. He and other Republicans argue that cutting the deficit will restore business confidence which, in turn, will lead to more jobs.

Putting Social Security on a secure fiscal path “is probably the easier thing to handle,” Becerra said. Fixing the old-age income-security program “easily could be” included in a deal that “takes a long-term approach to find balance.”

Talks are deadlocked and supercommittee members, facing a Nov. 23 deadline to produce legislation that would receive up- or-down votes in the House and Senate, said they planned to work over the weekend in Washington or via telephone to keep seeking a solution.

Simpson, 61, said Republicans ought to ditch their anti-tax vows. He said he signed an anti-tax pledge sponsored by Grover Norquist when he first ran for Congress in 1998 because “when you first run for Congress” you “get these pledges and ‘yeah, I’m not in favor of tax increases -- I’ll sign that pledge.’”

“I didn’t know I was signing a marriage vow with this,” said Simpson.

December Forecast: Bitter Spending Fights in Congress
(By Naftali Bendavid, The Wall Street Journal, November 23, 2011)

When Congress’s supercommittee’s fell apart this week, it did more than kill hopes for a deficit-cutting deal. It also set the stage for a contentious December that could see a host of ugly spending battles.

Lawmakers hoped the panel would find a way to extend the current payroll tax holiday and special unemployment benefits, among other things. Now Congress must tackle those issues before year’s end, deciding how to fund them amid the sour partisan atmosphere left over from the supercommittee battles.

Congress also faces an array of expiring tax provisions, and the measure currently funding the government runs out on Dec. 16. The last spending extension passed with 101 Republicans defecting, reflecting growing dissatisfaction by conservatives over current spending levels.

The question is whether Congress can navigate these volatile issues and bring December to a close without the sort of pitched partisan battles over spending that have repeatedly enveloped Washington, and alienated voters, over the past year.

The provisions affect millions of Americans, including Medicare beneficiaries and virtually every wage-earner in the country.

Next week, Senate Democrats plan to push for an extension of the current one-third cut in workers’ Social Security taxes. They hope to pressure Republicans into going along, since blocking an extension would in effect raise taxes in January.

President Barack Obama attempted to turn up the pressure this week. “When push comes to shove, are you willing to fight as hard for working families as you are for the wealthiest Americans?” the president asked in a New Hampshire speech. “What’s it going to be? That’s the choice.”

House Speaker John Boehner (R., Ohio) responded by holding out hope for a deal. “We told the president in September that we stand ready to have an honest and fruitful discussion with him regarding the payroll tax extension, and that invitation stands,” Mr. Boehner said.

Democrats say extending the payroll tax break, along with extended unemployment insurance payments, would boost the economy because the steps put money in the pockets of people who will spend it quickly. But Republicans insist that any government spending must be paid for.

Unemployed workers can now receive up to 99 weeks of unemployment insurance benefits, rather than the usual 26 weeks, in part due to provisions enacted during the recession. If these emergency benefits expire at year’s end, Democrats say more than 2 million workers would lose their benefits by mid-February.

But a one-year extension would cost about $45 billion, while helping states shore up their faltering programs, as Democrats also want, would add another $7 billion.

Some Republicans resist that idea. “If you want to extend unemployment benefits, they have to be paid for,” Sen. Rand Paul (R., Ky.) said on CNN last Sunday. “The question is, do we want to borrow money from China to pay people not to work?”

Some Democrats hope to entice Republicans by attaching the unemployment benefit extension to a program that allows workers to receive unemployment checks while they try out for jobs. This idea, based on a program in Georgia, has won support from members of both parties.

Less controversial, but still facing funding battles, are two items that Congress refuses to permanently fix: Medicare physician payments and a minimum tax that is sweeping in a growing number of middle-class Americans.

The current formula for paying doctors under Medicare significantly short-changes them, so Congress routinely passes a “doc fix” to bring their fees into line with actual costs. The latest adjustment expires at year’s end.

Similarly, Congress each year must adjust the Alternative Minimum Tax. This tax was created to ensure that wealthy Americans do not escape paying their fair share of taxes, but due to inflation, it includes a greater share of taxpayers each year, so Congress routinely adjusts the guidelines.

Taken together, the entire year-end package could cost about $440 billion, according to a senior Senate Democratic aide. That means a big fight, or a series of fights, over how to pay for it. Democrats may revive their proposal for a millionaires’ surtax, but that will not fly with GOP lawmakers.

Some lawmakers want to push for a single package that would include tradeoffs for both parties, extend government funding past the Dec. 16 deadline, and, they hope, avoid yet another spending standoff. But such a complex package would be hard to assemble on such short notice.

Durbin, 'Gang of Six' seek new debt-reduction deal over dinner
(BILL LAMBRECHT, St. Louis Post-Dispatch, November 29, 2011)

The quest to get done what the 'supercommittee' failed to accomplish may be picking up momentum with an effort by the Gang of Six to reconstitute itself and its hopes. At least combatants in Congress are breaking bread.

Sen. Dick Durbin, D-Ill., an original member of the bipartisan sextet, last night hosted the others in the Gang of Six at a dinner in his Capitol office to lay plans for the future.

The other five: Sens. Kent Conrad, D-N.D.; Tom Coburn, R-Okla.; Mark Warner, D-Va.; Saxby Chambliss, R-Ga.; and Mike Crapo, R-Id.

It was significant that two other senators -- Mike Johanns, R-Neb., and Michael Bennet, D-Colo., joined the six as representatives of about 40 senators from both parties who have offered support for what the Gang of Six is trying to achieve. That larger group includes Sens. Claire McCaskill, D-Mo. and Mark Kirk, R-Ill.

The goal would be deficit reduction of some $4 trillion over the next decade in a plan that includes weighty decisions about reforming Medicare and Medicaid along with figuring how to persuade enough recalcitrant Republicans, mainly in the House, to support new revenues in a revised tax code.

The Gang of Six framework spelled out earlier this year goes beyond a proposal rejected by the supercommittee seeking $300 billion in new revenues. Indeed, proposal offered by the six calls for at least $1 trillion in new tax revenues by eliminating and reducing tax breaks and deductions while at the same time lowering income tax rates.

But in some ways they must start over because of the $1.2 trillion in automatic budget cuts triggered by the supercommittee's failure.

Senate Majority Leader Harry Reid, D-Nev., cast doubt on the potential this afternoon by referring to the Gang of Six hopes as "happy talk."

Reid said that just before Thanksgiving, he received a letter from 38 Senate Republicans -- among them the three GOP members of the Gang of Six -- reiterating their opposition to tax increases.

"I say, put it in bill form, have it scored, bring it to me and I'll have a look at it. But other than that, it's just happy talk," Reid told reporters.

In a radio interview last week, Durbin acknowledged potential problems from Democrats when it comes to cutting entitlement program benefits.

"When it gets right down to it, there'll be people upset about it," he said. "But the message to them is very basic: Medicare, untouched, is going to run out of money in 12 years. Twelve years. Social Security, untouched, you cannot promise anyone under the age of 42 that they will receive Social Security anywhere like we receive it today."

Durbin has strong liberal credentials but he was among those who voted last December for a painful mix of spending cuts and tax increases put forth by the presidential debt commission.

Durbin, the Senate's No. 2 Democrat, said in recent days that if the Gang of Six can come up with a plan, he will push to hold a vote. A congressional aide said this morning he doubted that the group could formulate that plan yet this year but has designs on completing something early in 2012.

The senators are proceeding with the likelihood that any success beyond early next year is doubtful because of the onset of heavy presidential politics.

Chambliss, one of the six, told the Atlanta Journal-Constitution this week that he, too, is doubtful about getting such a complex package together by year's end.

"The fact that the supercommittee did nothing has changed things more than I had realized," he said.

Ryan teams up with Van Hollen on budget bill
(By Erik Wasson, TheHill.com, November 30, 2011)

House Budget Committee Chairman Paul Ryan (R-Wis.) and ranking member Chris Van Hollen (D-Md.), good friends but ideological opponents, have teamed up to introduce a bill that would give the president a type of line-item veto.

The bill, introduced Wednesday, is very similar to the Reduce Unnecessary Spending Act of 2011 that Van Hollen introduced in March.

It is not clear if Ryan’s backing for the idea, which President Obama has supported in the past, means that House leadership will bring it to the floor anytime soon. The proposal is not popular with appropriators, and the office of House Appropriations Committee Chairman Hal Rogers (R-Ky.) declined to comment Wednesday on the legislation. On top of that, December is packed with other tax and spending legislation to be dealt with.

House Majority Leader Eric Cantor (R-Va.) supports the proposal, his office said.

The Supreme Court struck down the actual line-item veto, which allows a president to selectively veto parts of a spending bill.

This bill gets around this by giving the president the ability to request cancelations of budget authority in specific appropriations bills and for that request to receive fast-track procedures in the House and Senate. The request would receive an up or down vote and could not be amended.

The Expedited Line-Item Veto and Rescissions Act of 2011 would also allow the president to withhold funds for up to 45 days while Congress acts on the request.

“Building upon spending cuts already enacted this year and a ban on earmarks, this bipartisan proposal represents a common-sense effort to reduce low-priority government spending. I thank my friend and colleague Chris Van Hollen for his partnership as policymakers work to earn back the trust of hardworking taxpayers,” Ryan said in a statement.

Ryan, the author of the controversial House-passed 2011 budget resolution that would transform Medicare to a premium-support system, declined to serve on this fall's supercommittee in order to focus on budget process reforms.

Congress faces pivotal week on stimulus, spending measures
(Paul Kane, The Washington Post, December 4, 2011)

Monday begins a pivotal week in Congress, the last opportunity this year to pass some kind of economic stimulus package to boost the ailing economy. This will also be a decisive moment for legislation to keep the federal government running on a leaner budget for the rest of the fiscal year.

Even though House and Senate leaders agree that the economy needs help, the two sides have failed to agree on how to approve an extension of the payroll tax holiday that President Obama pushed as part of his job-creation package in September. Set to expire on New Year’s Day, the tax provision has emerged as a key stumbling block in the annual rush to approve must-have legislation before Congress adjourns for the year.

In the tax-holiday debate, Democrats are largely united, while many rank-and-file Republicans are resisting overtures from their leaders to support the extension. The unusual dynamic of GOP discord over lower taxes has given Obama and his party a degree of political momentum they have been lacking since the 2010 elections.

“Our proposal would create jobs, put more money in the pockets of the middle class and working families, and theirs would in effect take those benefits away,” Senate Majority Leader Harry M. Reid (D-Nev.) said last week.

On Sunday, Democrats said Reid would make a new offer, perhaps Monday, to provide offsetting savings from a tax benefit that some economists say adds an extra 1 percent to economic output. House Speaker John A. Boehner (R-Ohio) is likely to offer his own proposal this week, setting up potentially dueling votes over the proposals by week’s end.

Reid and Boehner are probably headed for a final negotiation on the payroll tax that will initiate a two-track process for the legislation, which the leaders say must pass before Christmas. Along with the tax holiday, leaders are considering attaching an extension of unemployment insurance benefits and a measure to adjust Medicare payments to doctors — all of which, according to Boehner, will need accompanying spending cuts to make the package deficit-neutral.

In addition, Congress has until Dec. 16 to iron out the final pieces of a spending blueprint for roughly two-thirds of the federal government, a huge package that sets federal agency budgets at $1.043 trillion for 2012.

In a largely overlooked statement last week, Boehner acknowledged that after two straight years of spending reductions, those agency budgets are pretty lean.

“We’ve done most of what can be done,” he told reporters Thursday, suggesting that any further long-term deficit savings must come from changes in the tax code and entitlement programs.

Both sides on Capitol Hill are expressing optimism that the spending plan is on track for bipartisan approval, but the White House late last week issued several veto threats if Republicans insert policy provisions in the bills, such as funding restrictions on the new health-care law.

“If congressional Republicans want to avoid a veto and are serious about avoiding a costly government shutdown and preventing the uncertainty that a shutdown would bring to our markets and our economy, they will stop attempting to re-litigate the August agreement and abandon ideological stunts,” Dan Pfeif­fer, Obama’s communications director, wrote on the White House blog.

The relative calm surrounding the spending measure has raised the political stakes for the showdown over the payroll tax package.

The usual payroll tax rate of 6.2 percent was temporarily slashed to 4.2 percent in a deal that Vice President Biden negotiated last December with Senate Minority Leader Mitch McConnell (R-Ky.). That deal also extended the George W. Bush-era tax cuts through the end of 2012. Democrats say the payroll tax holiday effectively puts more cash in the hands of consumers, particularly the middle class. To finance another year’s holiday, Democrats proposed a 3.25 percent surtax on millionaires. Republicans rejected this new tax, as they have every time Democrats offered it this fall as a way to pay for other pieces of the Obama jobs plan.

Republicans believe they hold the political advantage because of the economy’s struggles.

But Democratic spirits were buoyed by Friday’s announcement that the unemployment rate had dropped to 8.6 percent, its lowest rate since early 2009, and GOP division on how to handle the payroll tax holiday.

This gave them a sense of having a slight wind at their backs, a rarity in the past several years.

GOP leaders remain supportive of extending the payroll tax holiday.

“I don’t think there’s any question that the payroll tax relief, in fact, helps the economy. You’re allowing more Americans — frankly, every working American — to keep more of their money in their pocket. Frankly, that’s a good thing,” Boehner said Thursday.

But that night, only 20 Senate Republicans supported an alternative proposal by McConnell to provide an extension of the plan. The McConnell proposal would have paid for the extension with pay freezes and reductions in the federal workforce. On Friday, Boehner’s leadership team tried to corral his rank and file behind a plan to extend the payroll holiday, but many Republicans simply rejected the proposal outright as a flawed way to create jobs, according to GOP aides.

Some Republicans warn that those payroll taxes support Social Security, meaning that any diversion of funds puts the program on a less secure setting in the years ahead.

Boehner is considering a bill that wraps the payroll tax plan in with other items that are considered conservative priorities, including a proposal to force the Obama administration to make a quick decision on a proposed energy pipeline from Canada to the Gulf Coast.

House Minority Leader Nancy Pelosi (D-Calif.) rejected that proposal as unrealistic, suggesting instead that the savings from the conclusion of the Iraq war and the drawdown of troops from Afghanistan be counted to offset the tax holiday, unemployment benefits and the Medicare payments for doctors.

Democrats hope to exploit the divisions within the GOP to help shape the final legislation to their liking. McConnell’s efforts have shown little progress toward a bill that can win bipartisan support, and Boehner has repeatedly needed Democratic assistance this year to approve budget bills.

“We are prepared to cooperate on behalf of the welfare of our country and of our people,” said House Minority Whip Steny H. Hoyer (D-Md.).

McCaskill, Collins try to bridge gap with new plan to extend payroll-tax cut
(By Robert Koenig, St. Louis Beacon, December 6, 2011)

WASHINGTON - Trying to break a Senate impasse over extending the payroll tax cut, a bipartisan pair of senators -- Claire McCaskill, D-Mo., and Susan Collins, R-Maine -- floated a plan Tuesday that would pay for that extension by ending Big Oil tax breaks and imposing a tax surcharge on millionaires that would spare some small businesses owners.

The bill aims to mollify the objections of some Republicans by weakening a controversial environmental regulation, extending three tax provisions that are set to expire at year's end -- including R&D tax credits and bonus depreciation -- and expanding the payroll tax cut to employers. It would also channel an extra $25 billion into highway and bridge programs.

Describing the bill as a "bipartisan breakthrough," McCaskill sent a Tweet early Tuesday said that it "prevents tax increase for middle class & invests in infrastructure." Without an extension of the payroll tax cut, which expires on Dec. 31, the average family would pay an extra $1,000 next year.

Collins told The New York Times that she did not want the millionaires surcharge to hurt small business owners who report business income on their personal income tax. "The fact that we have been able, in a bipartisan way, to come up with a means of protecting small businesses is potentially a breakthrough," Collins said.

Their bill, the "Bipartisan Jobs Creation Act," offers the latest approach to extending the payroll tax cut without worsening the federal budget deficit. On Thursday night, the Senate blocked both a Democratic and a Republican extension plan that would pay for the payroll tax cut in different ways, with the Democrats pushing for a millionaires surtax and the GOP proposing cuts and a freeze on federal pay increases.

On Monday, Sen. Robert P. Casey Jr., D-Pa., introduced a scaled-down version of the Democratic plan. It aims to appeal to GOP lawmakers by lowering the proposed millionaires tax surcharge (to 1.95 percent of income over $1 million, down from 3.25 percent), but -- unlike last week's plan -- it provide no payroll tax break for employers. Casey's plan was panned by many Republicans, and House Speaker John Boehner, R-Ohio, was developing an alternate plan.

In a White House appearance on Monday, President Obama contended that the payroll tax cut needs to be extended to ease the plight of middle-class families next year. "My message to the Congress is this: keep your word to the American people and don't raise taxes on them right now," Obama said.

A National Journal survey reported that 58 percent of Americans (including about half of Republicans surveyed) favored an extension of the payroll tax cut. Also, GOP presidential hopeful Mitt Romney told reporters Monday that he supported an extension of the payroll tax cut, although a spokeswoman clarified that he did not back a tax surcharge on millionaires to pay for it.

The McCaskill-Collins approach did not seem likely to convince the GOP lawmakers -- including Sens. Roy Blunt, R-Mo., and Mark Kirk, R-Ill. -- who object to an extension of the payroll tax cut on the grounds that it sets a bad precedent and weakens the Social Security trust fund. Payroll taxes go to the trust fund; proponents of a payroll tax cut say the income from other sources would be used to replenish the payroll-tax amounts that would be diverted from the trust fund.

After he voted against both Senate versions last week, Blunt said he opposed extending the payroll tax cut "because it significantly jeopardizes the future of Social Security by further separating the program from its main source of revenue."

Kirk, who also opposed both bills, said "Social Security was designed to be independent and free from the danger of Congressional manipulation, and maintaining the firewall between the Social Security Trust Fund and general government funding is the best way to maintain the solvency of this important program."

Compromise key to fix crisis
(By David Scott, Opinion Essay, Atlanta Journal-Constitution, December 7, 2011)

Everyone, from the tea party to the Occupy Wall Street movement, knows Congress must get its economic house in order. We can talk about how we got into this mess, but that would not answer the question of how to get out of this mess.

Bipartisan actions dug this hole, and we need bipartisan agreement to dig out. Now, both parties must, together, create millions of jobs for Americans, pay down our debt and strengthen Medicare, Social Security and Veterans’ programs.

Since the election of President Barack Obama, we have seen vehement opposition to him at all costs, driving our government to the brink of collapse simply because some want to see the president fail. This is not about Obama, but about Americans without jobs and losing their homes.

Extremes have manifested themselves, turning “compromise” into a dirty word, with many members asking “what’s good for me” instead of “what’s good for the country.” This is not just a country of the far right or the far left. This is a country of all of us. It cannot be my way or your way; it must be our way.

To get out of our economic hole, we need compromise on spending cuts and revenue increases. Millionaires and billionaires must pay their fair share, and more money must circulate in middle- and lower-income levels. This increases spending, which increases demand, creating the jobs we so desperately need.

Remember our history: Our heroes, Ronald Reagan and Ted Kennedy, would argue fiercely but were able to find common ground on major issues such as taxes and spending, as did former President Bill Clinton and Newt Gingrich. Our Founding Fathers had serious fights but were able to compromise. Alexander Hamilton and Thomas Jefferson were constantly at odds. Where would our nation be if they had not compromised?

I have served in Democratic and Republican majorities in the House. I served under Presidents Bush and Obama. I have learned to respect my colleagues — Republicans and Democrats — and listen to their concerns. And in every area of my work here in Congress, as well as my years in the Georgia Legislature, the key has been finding ways to build alliances and compromise.

Congress has a couple of weeks left to work together on critical issues: the payroll tax cuts, unemployment benefits, Medicare payments to doctors.

All are vital right now. America is depending on us to deliver.

Congress needs a debt vote
(Michael Smerconish, Philadelphia Inquirer, December 9, 2011)

Start voting.

That's my wish for the Congress when it comes to solutions regarding our nearly $15 trillion debt.

Three major bipartisan efforts in Washington offered long-term solutions to our astronomical indebtedness, but none resulted in up-or-down votes in Congress that would have provided a measure of accountability for the folks at home.

Simpson-Bowles was the first. After about a year of painstaking work, that bipartisan commission, made up of 18 members, could not get the requisite 14 votes to force congressional action on its plan.

The members' recommendations were a laundry list of third-rail issues: cutting the number of federal workers and the Defense Department; increasing the cost of participating in veterans' and military health care; raising the Social Security eligibility age; and reforming the tax code, including eliminating many tax credits and deductions.

They left no stone unturned. No special interest was left unscarred. Yet there was no vote, so voters lack a measuring stick to judge their members of Congress on the Simpson-Bowles proposal.

Instead, in the spring, House Republicans passed a partisan measure that would have cut federal spending by nearly $6 trillion while embracing a plan by Rep. Paul Ryan (R., Wis.) to reform Medicare. The plan failed to secure a single Democratic vote.

The next major bipartisan effort was the attempt by President Obama and House Speaker John A. Boehner to work out a grand bargain on raising the debt ceiling. It was reported at the time that the two sides were on the verge of agreeing to a two-stage strategy for raising the debt limit and cutting more than $4 trillion out of the federal budget through 2021. Reportedly, that plan would have included unprecedented cuts in spending, including at the Pentagon, and significant changes to Medicare and Social Security, the biggest drivers of future borrowing - a major concession for Obama and other Democrats. But those negotiations collapsed and deteriorated into finger-pointing. Plenty of members of Congress made their feelings known about various reported deals, but there was never an actual vote on a long-term solution.

It was the subsequent increase in the debt ceiling that gave rise to the 12-member supercommittee charged with coming up with a plan to cut the deficit by $1.2 trillion over 10 years by Thanksgiving week. Its failure is supposed to trigger automatic cuts in 2013. But, as with Simpson-Bowles and the Obama-Boehner efforts, the supercommittee generated nothing for constituents to use in holding their members accountable.

After more than 19 months of legislators' work on arguably the most important issue of the day, voters in November will have a spartan record by which to assess elected officials.

Sure, we can generalize based on the parties, including the House vote in April. We can look at news releases and public comments by individual members. But we lack a means of judging who is ready to compromise in the country's best interest.

Former Sen. Alan Simpson, one of the cochairs of Simpson-Bowles, said as much when I spoke to him this week. A bipartisan group of 11 commission members - three shy of the number needed to force a vote in Congress - supported the recommendations, he reminded me. Dozens of others, Simpson insisted, had offered public support for a debt-relief plan that included tax and entitlement reform.

But still there is no definitive action in Washington, and the potential result of this inaction, Simpson told me, continues to be frightening.

"In this next year, a lot of things are going to happen," he said. "You're going to see chaos in this country. You're going to see the rating agencies step in. You're going to see inflation kick in. If they can't get it done, you're going to see interest [rates] go up.

"And guess who gets hurt the worst? The little guy they always talk about, the vulnerable. Well, when people begin to see what's going on and nobody's doing anything, I think the people who play chicken and don't have the guts to do something in this situation will be the ones who will lose in November 2012."

Here's hoping he's wrong about the pending economic catastrophe and right about politicians who exhibit cowardice.

Obama, Boehner pitch competing economic plans
(By David Jackson, USA TODAY, December 10, 2011)

President Obama and Republican House Speaker John Boehner offered competing economic plans today, as the White House and Congress battle it out before the holiday break that precedes an election year.

In separate radio addresses, Obama stressed confirming the director of a new consumer financial protection bureau and extending a payroll tax cut due to expire at the end of the year.

Boehner also emphasized the payroll tax cut plan, but touted a plan that includes an oil pipeline project that the president says require further environmental study. Obama has suggested he would veto any payroll tax cut plan that includes other items.

"Congress can't end the year by taking money out of the pockets of working Americans," Obama said. "Now is not the time for playing politics."

For his part, Boehner said: "This is no time for the same-old my-way-or-the-highway theatrics."

In his radio address, the president protested the decision by Senate Republicans to block the nomination of Richard Cordray to lead the Consumer Financial Protection Bureau. Obama described the post as a "watchdog" whose job is "to protect American families from being taken advantage of by mortgage lenders, payday lenders, and debt collectors."

Republicans, meanwhile, said consumer bureau as currently constituted has too much power and threatens over-regulation of the economy.

In the GOP radio address, Boehner said House Republicans next week will pass an extension of the payroll tax cut that expires at the end of the year -- a bill that also includes the proposed Keystone XL oil pipeline project from Canada to Texas.

"At a time when (the American people are) still asking the question 'where are the jobs?,' the Keystone energy project is a bipartisan proposal the president ought to support," Boehner said.

Obama -- who has said the Keystone project needs further review -- said that payroll tax cut extension should be a stand-alone bill. He said it affects nearly 160 million Americans who will see tax hike unless the cut is extended by the end of this year.

"No one should go home for the holidays until we get this done," Obama said. "So tell your Members of Congress, don't be a Grinch. Tell them to do the right thing for you and for our economy."

Congress edges toward a compromise on spending
(Rosalind S. Helderman, The Washington Post, December 11, 2011)

Put this in the “small accomplishments” category for an especially gridlocked Congress: It appears increasingly likely that, with little fuss, lawmakers will approve a bipartisan compromise in coming days that will keep government running past Friday, when a short-term funding measure that has kept the lights on expires.

Partisan clashes have brought the government to the brink of a shutdown three times in the past year. But this time, appropriators from the House and Senate have been quietly working toward the unveiling, expected late Monday, of a compromise spending measure that would outline how government agencies should spend nearly $1 trillion through Sept. 30, 2012.

One thing the negotiators have had going for them is that they’ve been given space to work, their efforts largely overshadowed by a bitter fight between Republicans and President Obama over extending a one-year cut in the payroll tax, paid by 160 million workers, when it lapses at the end of the month.

It’s also helped that Congress agreed to an overall spending level for the year — often the most contentious issue — as part of the August debt deal. And talks have been smoothed as both parties have come to grips with the need for compromise. While Republicans hold a majority in the House, it has become clear that a bloc of several dozen members who want dramatic spending cuts will probably oppose almost any appropriations deal, meaning that Republicans need Democratic votes to get a bill passed.

The payroll tax fight will continue this week as the House votes on a GOP-authored proposal that would link the extension of the tax cut sought by Obama with Republican priorities, including a measure to speed the construction of the controversial Keystone XL oil pipeline.

On Sunday, Senate Minority Leader Mitch McConnell (R-Ky.) predicted that some Democrats who support construction of the 1,700-mile pipeline from Canada to the Gulf Coast would vote for the Republican bill.

But Senate Majority Leader Harry M. Reid (D-Nev.) has said the GOP measure is a “partisan joke” that cannot win approval in the Democratic-controlled Senate. Speaking Sunday on NBC’s “Meet the Press,” Sen. Lindsey O. Graham (R-S.C.) acknowledged that the pipeline was “probably not going to sell.” He predicted that Congress would find a way to broker a different bipartisan compromise to extend the tax cut.

Before concluding work for the year, Congress must tackle other major issues as well, including figuring out how to avert a scheduled deep cut in reimbursement rates paid to doctors under Medicare and whether to extend benefits for the unemployed.

Lawmakers had hoped to settle all of the issues and leave town by the end of this week. But members are already preparing for the possibility that continued disputes could force them to remain in session over the weekend and beyond.

Even so, leaders in both parties have been increasingly optimistic that one task that won’t hold things up is Congress’s most basic job: funding the government. They hope to bring the spending compromise to a vote this week and spare Washington the specter of another shutdown drama for nearly a year.

House Appropriations Committee Chairman Harold Rogers (R-Ky.) said late last week that it was his “hope and expectation” that the process would conclude this week.

His Senate counterpart, Daniel K. Inouye (D-Hawaii), said he was “confident” that talks were “on a path” to conclude before the holiday recess.

The negotiations have been eased by the August debt deal, in which Congress agreed to cap discretionary spending at $1.043 trillion for fiscal 2012, a figure that represents a 1.5 percent cut from the year that ended Sept. 30.

With the overall spending level for the year set, members of the appropriations committees have been able to turn to the detailed work of deciding how to divvy up spending among various federal programs.

The dynamics of the talks have also been shaped by the awareness by all involved that a bloc of several dozen House Republicans is likely to oppose whatever bill emerges.

That pattern has been established in spending votes this year, including in September, when 53 House Republicans voted against a short-term funding bill that kept government running through late last month.

Again last month, 101 House Republicans voted no on a measure that settled funding for five federal departments — Agriculture, Commerce, Housing and Urban Development, Justice, and Transportation — through next September.

Approved with a bipartisan majority, that measure also provided temporary funding for the rest of government, that lasts through Friday.

The bill under consideration this week is intended to set funding priorities for the other three-fourths of the government, including the Defense Department and war spending, for the remainder of the fiscal year.

The repeated defections of rank-and-file Republicans mean that GOP leaders know they must broker a compromise with House Democrats to get a spending bill through their own chamber, much less the Senate.

The contentious payroll-tax debate has also served to provide cover for the appropriations discussions to continue with little attention.

Despite the progress, members of the House and Senate appropriations committees spent the weekend tangling over a series of policy proposals that could still threaten the measure’s easy passage.

Those discussions have been especially tricky over the part of the bill funding the departments of Labor, Health and Human Services, and Education and another part that would provide money for the Interior Department and other environmental agencies. These are areas loaded with high-profile policy implications, including abortion rights, the Obama health-care law and environmental regulations. But although congressional aides acknowledged that a last-minute snag could still crop up in a Congress prone to unexpected blowups, the aides say steady progress has been made toward a compromise.

Members of Congress conducting the hard work of spending negotiations said the public should take heart from the rare evidence of legislative compromise.

Rep. Norm Dicks (Wash.), the ranking Democrat on the House Appropriations Committee, called the group “the last bastion of getting something done around here.”

A compromise, Inouye added, would “show that reasonable people are able to reach reasonable agreements.”