Democrats Plan Votes on Taxes With No End Strategy

Posted November 29, 2010 at 7:09pm

Updated: 8:47 p.m.

Democratic leaders in the House and Senate are apparently intent on holding at least one vote in the coming days on extending Bush-era tax cuts for middle-class wage earners, but there is no clear path to forging a bipartisan deal on the thorny issue.

On the House side, Speaker Nancy Pelosi (Calif.) is expected to schedule a vote on a middle-class tax cut bill — which would apply to those making $250,000 and below — sometime this week.

“We will have that vote — this week,” outgoing Democratic Congressional Campaign Committee Chairman Chris Van Hollen (Md.) said following a Monday evening leadership meeting.

One senior Democratic aide predicted Monday that leaders would bring up the middle-class tax cut extension this week under suspension of normal rules, in part to avoid giving Republicans a chance to offer a motion to extend the tax cuts to all income brackets.

Democrats might not be able to get the votes to beat back an across-the-board extension if Republicans forced a vote, and they are also unlikely to be able to muster the two-thirds majority needed to pass the middle-class tax cuts on suspension.

“To most members of the Caucus, a vote on the middle-class tax cuts alone is important, regardless of what the Senate does,” one Democratic leadership aide said.

In the Senate, Majority Leader Harry Reid (Nev.) has repeatedly said he will hold a vote on the middle-class tax cut package as well. Reid would then likely allow a vote on a GOP alternative extending all the tax cuts to provide a contrast between the two parties.

“The preferred method for most of the Caucus is middle-class tax cuts — versus all the cuts — to create a clear contrast,” a Democratic aide familiar with the issue said Monday.

But what happens next remains unclear at best. With virtually no GOP support for a middle-class-only bill, Reid and his fellow Democrats will have to find some sort of compromise that attracts enough GOP support to pass the Senate while remaining palatable to House Democrats.

According to aides, Senate Democrats are expected to discuss the way forward Tuesday afternoon during a closed-door Conference meeting.

These aides said a host of options will be on the table, including holding a series of votes on the middle-class tax cut extension to force Republicans to repeatedly vote against it. The motions could vary, with different income levels used for the cutoff — for instance, the Senate could vote on legislation extending the cuts for wage earners up to $250,000, then vote on a measure applying to wage earners up to $350,000.

A second option, which could come after Reid has forced multiple votes on middle-class tax cuts, would extend the middle-class cuts permanently while extending tax cuts for top wage earners temporarily.

But if Republican opposition does not crumble under those tactics, Reid’s end game remains uncertain, aides said. He could look to pass legislation that extends all tax cuts for a short period of time — aides said from one to three years — that also includes an extension of unemployment benefits.

Also uncertain is how Pelosi will handle any compromise legislation. She and her lieutenants are not tipping their hand about whether they would back any one of several compromise approaches after holding an initial vote just on the middle-class package. Majority Leader Steny Hoyer (D-Md.) reiterated his opposition last week to even a short-term extension of the cuts for higher wage earners. 

Aides and lawmakers cautioned that the legislative approach could hinge on what — if any —compromise is forged at a bipartisan leadership meeting at the White House scheduled for Tuesday.

Support for a tax fight remains fairly strong, at least at this point.

Among the 60-plus Democrats who were defeated Nov. 2, one senior aide said there were “definitely some Members who want to be on record as having taken a vote so they could run again.” The aide predicted that House leaders would wait to see what passes out of the Senate before scheduling a second vote on the tax cuts. 

But rank-and-file House Democrats have been all over the map on whether to hold a vote on extending the tax cuts, which income brackets to extend them for and for how long. And the elections have not healed those divisions. 

“It is the height of stupidity to do any kind of tax vote right now,” said one Democratic aide with ties to moderates. “If we were smart, we would let Republicans deal with this come January. Let them have to compromise. … Let them make the decision with all of this.”