2-Month Payroll Tax Cut Extension – Huh? What??

Just when you think Congress can’t be any dumber, they prove you wrong.

Perhaps the U.S. Congress turns otherwise intelligent, capable public servants into raving masochistic lunatics.

Just what, exactly, did the Senate approve on Saturday? Who are the winners and losers? Where do we go from here?

Its to complex to fully understand and explain, but I’ll give it a shot.

What Did The Senate Pass on Saturday?

There have been 4 bills for extending the payroll tax holiday submitted in the Congress; two from each party.

The Senate on Saturday took up the most complicated and controversial of the Republican plans, HR 3630, then amended it, and sent it back to the House for final approval.

Previously, President Obama threatened to veto HR 3630, and Senate Majority Leader Harry Reid declared it DOA in the Senate after the House passed it last Tuesday.

Fundamentally, Democrats reversed themselves and caved on two big ticket items. They gave up the millionaire’s tax and allowed a decision on the controversial Keystone Pipeline project to be moved up.

President Obama made a short, terse White House appearance on Saturday giving the amended HR 3630 his blessing.

What is in the Senate Amendment?

HR 3630 is a 370 page monstrosity of a bill. Even just the amendment passed by the Senate on Saturday is 32 pages long:

Republican House Plan:
Middle Class Tax Relief and Job Creation Act of 2011 (HR 3630)
– Rep. Dave Camp(R-MI), 12/9/2011

The Senate Amendment:
Temporary Payroll Tax Cut Continuation Act of 2011
– Senate Majority Leader Harry Reid(D-NV), 12/17/2011

Its doubtful anyone really understands it all. I tried, and failed; and I’m smarter than most Congressman.

The Senate amendment to HR 3630 has these features:

  • It changes the name of the bill
  • It changes a bunch of dates from 1 year to 2 months
  • It recalculates the cost of the bill to reflect the change
  • It uses a 10-year mortgage fee to pay the 2-month cost

Democrats renamed the Republican bill “Temporary Payroll Tax Cut Continuation Act of 2011”. Big whoop!

Why did Democrats NEARLY Accept the Republican Plan?

For all the things there are for Democrats to hate about it, the Republican House bill – HR 3630 – has features in it Democrats want, but that are not in any of the Democratic bills. They are:

  • Extends UI benefits
  • Extends a bunch of health care provisions

No doubt, a major mitigating factor is that everyone in Congress wants to go home for Christmas. The delay – gasp! – has already cut into President Obama’s golfing time.

What Now?

Three things can happen:

  1. The House can accept, as is, the Senate amended changes
  2. A House-Senate conference committee can be set up to resolve differences
  3. They can throw everything out and start from scratch


It ain’t over ’till its over.

On the Sunday talk show circuit House Speaker John Boehner signaled that a 2-month extension of the payroll tax holiday isn’t acceptable. He feels the job isn’t done until a full year extension is agreed.

You’d think since Republicans won pretty much all the concessions that they’d be willing to grant Democrats something.

But ya kinda, sorta have to agree with the Speaker on this one. Pass a 2-month extension only to go through the same bickering and posturing again before you know it. That’s lunacy!

So it looks like it ain’t over yet.

Stay tuned for the Christmas episode of the exciting new blockbuster C-SPAN series, “Payroll Tax Holidays!”



Other related Social Security/payroll tax holiday articles can be found here:

Payroll Tax Cut: Victory for Obama?
-Azleader, Inform The Pundits!, 12/27/2011

Payroll Tax Cut: How Many Jobs?
-Azleader, Inform The Pundits!, 12/21/2011

2012 Payroll Tax Cut Holiday Extension – Democrats vs. Republicans
-Azleader, Inform The Pundits!, 12/15/2011

Payroll Taxes: Good News/Bad News
-Azleader, Inform The Pundits!, 12/9/2011

Payroll Taxes… Change of Venue
-Azleader, Inform The Pundits!, 11/22/2011

The Systemic Demise of Social Security
-Azleader, Inform The Pundits!, 11/15/2011

President Obama’s Jobs Proposals
-Azleader, Inform The Pundits!, 9/1/2011

Don’t Extend the Payroll Tax Holiday
-Azleader, Inform The Pundits!, 8/21/2011

Extend the Payroll Tax Cut Holiday… into 2012?
-Azleader, Inform The Pundits!, 7/1/2011


About azleader

Learning to see life more clearly... one image at a time!

Posted on Dec 19, 2011, in Harry Reid, John Boehner, news, Obama, Payroll tax, payroll tax cut, Politics, Social Security, Taxes, U.S. Economy. Bookmark the permalink. 5 Comments.

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