House passes Republican payroll tax cut plan
WASHINGTON — Defying a White House veto threat, the US House of Representatives voted Tuesday to tie a payroll tax cut extension to the swift approval of the controversial “Keystone XL” US-Canada oil pipeline.
US President Barack Obama’s Republican foes used their majority to muscle the bill to passage in a largely party-line 234-193 vote, sending the legislation to the Democratic-led Senate where it was expected to die.
Obama had threatened to veto the bill, deepening a year-end showdown with Republicans that threatens to disrupt Christmas holiday plans and even shutter the government, with a crucial catch-all spending plan caught up in the logjam.
The president and his Republican foes have been battling over the best way to revive the ailing US economy, the top issue on voters’ minds amid historically high unemployment and fears Europe’s debt crisis could reach into US markets.
His Office of Management and Budget said that the House-passed bill should have reflected a balanced approach that could pass both chambers of Congress.
Instead, the office said in a statement that the bill “represents a choice to refight old political battles over health care and introduce ideological issues into what should be a simple debate about cutting taxes for the middle class.”
Republicans say the legislation will create thousands of new jobs, extend a payroll tax cut and offset the cost of extending the tax cut with spending cuts.
“The President says that the American people ‘can’t wait’ for jobs,” House speaker John Boehner said before the vote.
“Well, clearly, if we pass this bill today we will be taking the first big step toward creating jobs in America, and it will be time for the United States Senate to act.”
Democrats accused Republicans however of larding up the bill with projects they cannot support, including the Keystone XL pipeline extension which Obama has put off until after next year’s election for further environmental study.
The pipeline — which is designed to bring oil from Canada’s tar sands to the United States — has triggered a fierce row in Washington, with Republicans accusing Obama of caving into liberal environmentalists.
On Monday, the State Department warned that a bid to force Obama to accept an arbitrary deadline for the project could actually kill it, as it could not issue a permit if there was not time to comply with environmental laws.
The White House reiterated Tuesday that Obama would not allow Congress to leave town for the holidays without passing an extension of the payroll tax cut, which it says will give Americans a $1,500 tax break next year, or extending unemployment insurance.
It also insisted that an omnibus spending bill that would fund the government through fiscal year 2012 had not yet been finalized.
Republicans accuse Obama and Democratic Senate majority leader Harry Reid of conspiring to slow the bill as they seek leverage on the payroll tax battle.
The White House is believed to fear that the Republican House could vote on the spending bill and then leave for the holidays — thus leaving the payroll tax cut extension in limbo.
If a spending bill is not agreed by Friday, the federal government could shut down. But the White House said Tuesday lawmakers should if necessary pass a temporary funding bill to keep government running until a final deal is reached.
Democrats want to hike income taxes on the richest Americans but Republicans are calling for a freeze in hiring of federal workers and oppose more burdens on wealthy citizens who they say create jobs.
“Our proposal would protect and extend the tax cut for 160 million Americans, 160 million Americans, while asking 300,000 people, those making over $1 million a year, 300,000 people, to pay their fair share,” said Democratic House Minority Leader Nancy Pelosi.
The House-passed measure would require the Obama administration to sign off on the pipeline by early next year unless the president declares that doing so is not in the national interest.