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TheStreet Open House

Payroll Tax Cut Talks Adrift On Capitol Hill

ANDREW TAYLOR

WASHINGTON (AP) â¿¿ The prospects for an extension of President Barack Obama's signature payroll tax cut, once considered a slam dunk on Capitol Hill, now seem far less certain as House-Senate talks have deadlocked over finding ways to pay for it.

In a contentious negotiating session Tuesday, Democrats came out against House GOP proposals to partially pay for the two percentage point payroll tax holiday through freezing federal workers' pay and requiring more affluent seniors to pay higher Medicare premiums.

Also at stake is a renewal of jobless benefits for people who have been out of work for more than six months and repairing an outdated government formula to prevent doctors from having to bear a huge cut in their Medicare payments.

After four public sessions, the House-Senate talks have failed to yield a single significant breakthrough, leading party leaders in both the GOP-dominated House and Democratic majority Senate to lob charges that their rivals are slow-walking the negotiations.

"We have significant concerns about whether Senate Democrats are really willing to step up and work with House Republicans on the payroll tax cut bill," House Speaker John Boehner, R-Ohio, told reporters Tuesday. "Senate Democrats have never come to the table with a plan to offset this new spending that they're all for."

For his part, Senate Majority Leader Harry Reid, D-Nev., has threatened to bring up a whole new measure if the House-Senate negotiations remain stalled.

Michigan Rep. Dave Camp, the top GOP negotiator, has turned the focus to the most contentious issue: finding ways to foot the bill for the $150-160 billion cost of the measure.

But Camp, a top Boehner lieutenant, has been slow to invite Democrats to discuss their ideas to pay for the legislation, insisting â¿¿ at least until Tuesday â¿¿ on obeying arcane rules that limit the scope of the debate to the GOP ideas that have passed the House on a near-party line vote last year. That has led to meandering discussions on topics like blocking EPA rules on emissions from industrial boilers and allowing states to impose drug tests on people receiving jobless benefits.

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