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Payroll Tax Cut Conferees Avoiding Sticky Issues

Tom Williams/CQ Roll Call
Senate Minority Whip Jon Kyl (above) advocated for a proposal that unemployment beneficiaries show progress toward getting a GED or high school diploma — a proposal that Sen. Benjamin Cardin called “fundamentally flawed.”

Pieces of the president’s plan that could be offered are: work-sharing measures that would provide unemployment insurance to employees whose bosses reduce hours and pay instead of impose layoffs; a “Bridge to Work” program that would encourage states to offer temporary work or on-the-job training; enabling states to create wage insurance programs to re-employ older workers; and creating a state-based program to encourage entrepreneurship among laid-off workers.

These issues, however, even if they are accepted by GOP conferees, only scratch the surface of the problems facing the committee. In the past, UI funds were designated as emergency spending and exempted from Congressional pay-as-you-go rules. However, conservatives in the House want the benefits offset, making the calculus difficult for Democrats looking for a way to bridge the 40-week differential in UI coverage. In the House-approved bill, the maximum weeks of benefits were cut to 59 from 99.

Democrats again pushed for a surtax on millionaires to pay for the program extensions, but House Ways and Means ranking member Sander Levin hinted after the meeting that his party might have to back off.

“I guess when there’s a wall, we see the wall, and the Republicans have been emphatic that they don’t want to increase the taxes on the very, very wealthy,” the Michigan Democrat said.

Sources familiar with negotiations between Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) indicated that when the two men were trying to negotiate a full-year deal in December, there had been talks of settling on a window of coverage in the range of 70 weeks.

Even if an agreement is reached on the time frame, House Republicans proposed several other changes, including requirements that jobless beneficiaries show progress toward getting a GED or high school diploma.

“There’s a saying that you can’t teach an old dog new tricks, but that’s not true for the head of a household who wants to get back to work and earn a living for his family,” Senate Minority Whip Jon Kyl (R-Ariz.) said Wednesday. “He’s willing to learn how to use a BlackBerry or a computer or something like that in order to be able to be a more useful employee.”

Democrats rebuffed the proposal, noting most Americans receiving benefits are more than 40 years old. “It’s just fundamentally, I think, flawed,” Sen. Benjamin Cardin (D-Md.) said. “A GED is not going to make a difference for them getting their jobs back.”

Rep. Xavier Becerra (D-Calif.), on the other hand, worried that time spent discussing UI reforms at all would jeopardize the effort entirely, and the program “should not be put at risk because we can’t figure out a way to get this done by Feb. 29.”

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