House rejects payroll tax cut compromise

Updated: 3:19 p.m. ET

The House on Tuesday voted to disapprove a Senate bill that would have extended the payroll tax cut and unemployment insurance for two months, seeking instead a conference with the Senate to work out differences between the two chambers' bills.

The motion, which dictates that Congress go to conference with the Senate on the payroll tax package and disagrees with the Senate bill, was approved in a 229-193 vote falling largely along party lines: Seven Republicans voted against it, as did all Democrats.

By declining to vote on the actual Senate-passed legislation, House Republicans avoid voting "no" on the popular measure - theoretically making it harder for Democrats to target them for opposing a payroll tax cut bill. Because House Republicans passed their own bill addressing the payroll tax cut, they were then able to vote for a conference on the House bill and the Senate bill while avoiding a vote on the Senate bill altogether.

In a surprise announcement in the White House briefing room following on Tuesday afternoon, President Obama blasted a "faction of Republicans in the House" for "refusing to even vote on the Senate bill."

"Even though Republicans and Democrats in the Senate were willing to compromise for the good of the country, a faction of Republicans in the House are refusing to even vote on the Senate bill -- a bill that cuts taxes for 160 million Americans," he said. "And because of their refusal to cooperate, all those Americans could face a tax hike in just 11 days, and millions of Americans who are out there looking for work could find their unemployment insurance expired."

House Republicans argue that the Senate bill - which was negotiated by leaders Mitch McConnell, R-Ky., and Harry Reid, D-Nev., and which sailed through the chamber with broad bipartisan support - is a short-term fix for a long-term problem.

"As we approach the Christmas holidays and the prospects of a new year, what we're saying is, we want to provide families with some certainty," said Rep. Eric Cantor, R-Va., in an interview with MSNBC shortly following the vote. "I think everybody in the town agrees that 60-day extension on tax policy is not the way to legislate. Everyone from the president to the Democratic leaders in the Senate as well as we in the House believe that's what we ought to be doing, and that's the position that we've taken on behalf of the hard-working taxpayers of this country."

Senate Majority Leader Harry Reid has indicated that he will not bring the Senate back to conference on the bill, warning in a statement yesterday that House Republicans would be held responsible -- at least by Democrats -- if Americans saw their taxes go up on January 1st.

In a statement following the vote, Reid said it was "unconscionable" for Republicans to block the legislation.

"It is unconscionable that Speaker Boehner is blocking a bipartisan compromise that would protect middle-class families from the tax hike looming on January 1st -- a compromise that Senator McConnell and I negotiated at Speaker Boehner's own request," Reid said. "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."

A spokesman for Reid suggested that the Democratic leader would stand by his decision not to call back the Senate. And on Monday night, House Minority Leader Nancy Pelosi said she would not appoint any House Democrats to participate in the conference.

In light of Democrats' apparent adamance against going to conference on the bill, House Speaker John Boehner on Tuesday urged President Obama to "call on Senate Democrats" to return to Congress and "sit down and resolve this bill as quickly as possible" in conference.

"I need the president to help out!" he exclaimed, to Republican applause, in remarks to reporters.

"We have done our job. All we need now is to resolve our differences," Boehner said. "A two-month extension is nothing more than kicking the can down the road. The president has asked us to do this for a full year; we did it for a full year. We offset the costs with reasonable offsets. There's no reason we can't do this."

Boehner also suggested that, contrary to reports, he never indicated to Senate leadership that he would support the bill they came up with. 

"When they were getting ready to pass this [bill]... I made it clear to them at that point that I was uncomfortable with where they were going -- and I expressed my displeasure," he said, referring to negotiations between Reid and McConnell over language for the legislation they thought both parties could support.

Mr. Obama, however, made no indications that he would "help out" the speaker, noting instead that it is not too late for the House to bring the Senate bill up for a vote, and calling on them to do so.

Mr. Obama argued that House Republicans, despite advocating for the passage of a payroll tax cut extension, are attempting to "wring concessions from Democrats on issues that have nothing to do with the payroll tax cuts -- issues where the parties fundamentally disagree."

"We have more important things to worry about than politics right now. We have more important things to worry about than saving face or figuring out internal caucus politics," he continued. "The clock is ticking. Time is running out. If the House Republicans refuse to vote for the Senate bill or even allow it to come up for a vote, taxes will go up in 11 days."

Whether or not any or all House lawmakers will be allowed to leave town for the holidays remains unclear - but Democratic Sen. Chuck Schumer on Tuesday suggested that Democrats will hold their ground on the matter and hope that Republicans cave to increasing pressure.

"Pressure every day is mounting on Republicans," Schumer said in an appearance on MSNBC. "All you have to do is let the pressure mount, day in and day out, and they will come back and support the two month. Not a majority of Republicans, but enough Republicans added to the Democrats to pass the bill by a large majority. In a few days, they will fold."

In the meantime, Democrats continue to lay blame at the feet of House Republicans for blocking legislation they argue has broad bipartisan support, while Republican lawmakers contend Democrats are seeking a band-aid solution that fails to adequately address the problem at hand.

"Don't blame Congress for not working together," said Rep. Jan Schakowsky, D-Ill., in comments on the House floor Tuesday, before blasting Republicans for their "sanctimonious rhetoric." "Blame the House Republicans - who can't even work with each other."

Rep. Steve Scalise, R-La., on the other hand, argued on the floor that voters are "sick and tired of this absurd action from Congress" - and that they want long-term solutions rather than a "two-month patch that doesn't even fix the problem."

"Pelosi said she will not appoint any House Democrats to participate in [conference] negotiations," he continued. "In the spirit of Christmas, you've got the minority leader saying she'll just take her toys and go home."

Cantor's office announced Tuesday that House members will get 24 hours' notice before the next vote. Consequently, most members are expected to go home after subsequent votes this afternoon.

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