Tax deal advances in Senate

Senate clears tax deal for final vote, 83-15.

Robert Menendez says the deal with make 'a real difference' for middle-class families. | AP Photo Read more: http://www.politico.com/news/stories/1210/46309.html#ixzz182QFfwguBy: Carrie Budoff Brown and Jonathan Allen December 13, 2010 12:14 PM EST

President Barack Obama’s tax compromise with Republicans cleared its first major hurdle Monday, as the Senate agreed to move the $858 billion bill renewing the Bush-era tax rates for all Americans to a final vote. The Senate will vote on final passage Tuesday and send the bill to the House, where it is also expected to win approval, but not before Democrats attempt to make changes. Speaking to reporters Monday, Obama called on the House to move forward without delay – but acknowledged that both liberals and conservatives had serious objections to the bill. “I recognize folks on both sides of the political spectrum are unhappy with certain parts of the package, and I understand those concerns. I share some of them, but that’s the nature of compromise, sacrificing something each of us cares about to move forward on what matters to all of us,” Obama said at the White House. “I urge the House of Representatives to move quickly on this matter, because if there’s one thing we can agree on, it’s the urgent work of protecting middle class families, removing uncertainty for America’s business and giving our economy a boost as we head into the new year,” he said. The bill received bipartisan support in the Monday Senate test vote, an anomaly in the highly partisan environment on Capitol Hill over the last two years. By 5:15 p.m., the vote was 79-10 – with several Democrats coming out against it in the early voting, including Sen. Russ Feingold (Wisc.), Kirsten Gillibrand (N.Y.) and Patrick Leahy (Vt.) Vermont’s other senator, independent Bernie Sanders, also voted no after filibustering the bill. But the deal wasn’t widely praised, even by senators who backed it. Sen. John McCain (R-Ariz.) railed against tax breaks targeted at specific industries or constituencies, repeating a nickname coined by the Wall Street Journal for a provision that extends an ethanol tax credit: the “Hawkeye Handout,” since it was sought by Iowa senators. “Rather than just extend the tax breaks, which is what the majority of Americans want, we engaged in the continuing practice, which has alienated the majority of the American people, of loading up with unneeded, unnecessary, unwanted sweeteners in order to, I guess, get votes or satisfy special interests,” McCain said on the Senate floor. “I’ll vote for it, but it’s not what the people said they wanted done on Nov. 2.” But Senate Minority Leader Mitch McConnell (R-Ky.) argued that the compromise was the “first clear sign” that the midterm elections had an impact on Washington. “Here’s how. For two years, Democrats in Washington have argued that the solution to our nation’s economic problems was to give bureaucrats in Washington trillions of dollars and then have them spend it for us,” McConnell said. “But with this bipartisan compromise, we’re taking a different approach. We’re telling the American people to keep money that’s rightfully theirs, so they can spend it and invest it as they please. This is an important shift, and the White House should be applauded for agreeing to it.” The bill faces a rougher road in the House. Top Democrats have acknowledged that the bill would receive a vote in the House, despite the nonbinding vote by the House Democratic caucus last week to oppose the measure. But they are insisting on changes. On Monday afternoon, House Democratic leaders discussed a plan to amend the estate tax portion of the agreement with the language of a bill by Rep. Earl Pomeroy (D-N.D.) that passed the House, 225-200, late last year. Pomeroy's measure, which the Senate never considered, would permanently set the estate tax rate at 45 percent with an exclusion on the first $3.5 million of wealth — a bump from the proposed level of 35 percent with a $5 million exemption. Rep. Chris Van Hollen (D-Md.), who was tapped to negotiate for House Democrats before being cut out of the deal-making process, advocated for allowing such a "rifle shot" amendment if the House takes up a Senate-passed bill. He has said repeatedly that the estate tax provision in the Senate bill, written essentially by Jon Kyl (R-Ariz.), is the most odious of the items in the legislation because it would keep large amounts of wealth in the pockets of a relative handful of families. “As the Democratic caucus said, this bill in its current form is unacceptable,” Van Hollen said Monday on MSNBC’s “The Rundown.” “It will come to the floor of the House in some form, and it will be open to changes.” House Majority Leader Steny Hoyer struck a similar note Monday, saying he expects a vote in the House this week. “I think we will pass a bill, as opposed to simply not passing anything,” he said at the National Press Club. “I think we’re going to have a vote on the Senate bill, with possible changes. We’ll see what the process is.” Democratic sources say House Speaker Nancy Pelosi is leaning toward a process in which the House would take up the Senate bill and allow lawmakers to attempt to amend it with proposals, including boosting the estate tax to a level higher than the Senate bill's mark. But no strategy decision has been finalized, and there are any number of ways to get the bill to the floor, allow for votes on various options and ensure that taxes don't go up on everyone on Jan. 1. The House could amend the bill and send it back to the Senate, which would then need to vote again. But it's likely that any final changes will be additions to the bill — such as the renewable energy credits that House Democrats are hooked on — not modifications of its core components. If it gets to the president's desk, it's almost certain to keep his deal in place. Obama sold his bill Monday, doing interviews with TV stations in media markets in four key electoral states: Columbus, Ohio; Denver, Colo.; Des Moines, Iowa; and Tampa/St. Petersburg, Fla. A new poll by the Pew Research Center showed the tax-cut deal is winning broad bipartisan support. In all, 60 percent of voters surveyed approved of the agreement, while just 22 percent disapproved. There was almost no difference in partisan reaction to the bill, with 63 percent of Democrats, 62 percent of Republicans and 60 percent of independent voters supporting the deal. Among Democratic voters, liberals support the deal as much as conservative and moderate Democrats, the Pew poll found — a marked difference from House Democrats who have raised strong objections to the deal. Simmi Aujla and Jeanne Cummings contributed to this report.

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