Update: The deal is done:
House Republican leaders have decided to accept a short-term extension of the payroll tax cut, sources told ABC News this afternoon, preventing a hike in taxes just nine days before the tax break expires for 160 million Americans.
House GOP leaders appeared to be adopting a compromise suggested by Senate Minority Leader Mitch McConnell to pass the two-month extension in exchange for the Senate appointing members to a conference committee, which will negotiate a longer-term solution. The proposal won a nod of approval from President Obama and Senate Majority Leader Harry Reid.
The payroll tax deal has been causing headaches for a while now, but we may be seeing the light at the end of the tunnel. The Wall Street Journal is reporting that Minority Leader Mitch McConnell is calling on House Republicans to accept the short term deal.
WASHINGTON—Senate Minority Leader Mitch McConnell (R., Ky.), seeking to end an impasse on renewing the payroll-tax cut set to expire at the end of the year, on Thursday urged House Republican leaders to pass a short-term extension and said Senate Democrats should name negotiators to work out a longer-term deal.
The overture came as Republicans and Democrats remained at odds over how to prevent the payroll-tax cut from expiring. The House this week rejected a temporary solution approved 89-10 by the Senate on Saturday.
House Republicans have said Congress should instead pass a one-year extension and have said they won't sign off on the interim measure negotiated between Senate Republican and Democratic leaders.
House Speaker John Boehner (R., Ohio), working to appease his rank and file, was left in the difficult position of calling for renewed negotiations after the Senate already had recessed for the year, a situation that has drawn criticism from Democrats and Republicans alike. Democrats have said the two sides are too far apart to negotiate a one-year package before the end of 2011 and that a temporary extension is the only solution right now.
Meanwhile, the White House is asking, "What does $40 mean to you?" and soliciting responses. Doug Powers turns it back on them:
I asked the same “What does $40 mean to you” question, except the other way around. The answer from the White House appears to be: “Not much.”
–Forty dollars could be given back to almost 14 million taxpayers for what went up in carbon neutral smoke on Solyndra.
–Forty dollars could have been sent to almost 21 million people for what was spent on the stimulus. That’s a lot of “Friday Family Pizza Nights” that could have been “saved or created.”
–Forty dollars is the “investment” of 6,250 taxpayers in each Chevy Volt.
–It took 2,500 taxpayers unwittingly shelling out $40 each just to pay for a separate flight to Hawaii.
Nobody in government — particularly this administration — should be asking taxpayers what difference $40 makes in their lives. Taxpayers should be asking the administration what $40 means to them.
The payroll tax issue will be settled, but the much larger, longer term problem isn’t budging.
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