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House Republicans balk on tax policy: the mess gets messier

December 22, 2011

Right when you think things are beginning to improve somewhat in the nation’s capital, our most recent national nightmare grows worse. Ag groups in town were hoping and predicting, now that the Super Deficit Reduction Committee failed to reach any agreement, attention might be refocused toward developing a new Farm Bill. Congress would have more time holding hearings and receiving input from stakeholder groups. Things would return to normal, or some semblance of it, key ag leaders prophesized.

Well, think again. The mess is messier. The fiasco and its potential consequences just got worse. The Senate approved a deal to extend the federal payroll tax for two months. The vote was overwhelming, 89 yeas, including 39 Republicans. Then, House Republican leaders come along and oppose it. House speaker John Boehner (R-Ohio) refused to even allow a vote on the Senate-passed measure.

The Senate agreement not only includes continuation of the tax cuts, but also addresses unemployment benefits that are scheduled to expire at the end of December as well as cuts in the reimbursement rates for doctors who treat Medicare patients. Economists are warning that this imperials the overall U.S. economic recovery. Workers will receive less money in their 2012 pay checks, and 3.5 million unemployed people will lose their benefits. Not extending the tax cuts may also mean a reduction in the creation of 750,000 new jobs.

The above tax standoff presents potential grave consequences for the Republican Party. Just how many voters are we talking about here? House Republicans’ failure to act very well may result in some lasting damage to the GOP. Even presidential candidate Newt Gingrich warned that the situation could end very badly for his party. “Republicans should do what is right for the American people,” he stated. The Wall Street Journal suggested that the tax debate “might end up re-electing [Obama] before the campaign begins.” And national polls are reporting that Republicans are getting killed in public opinion.

The Council of Economic Advisers indicates that never before has Congress failed to extend special benefits when unemployment rates are as high as they are today. Nearly 1.5 million voters will automatically lose their coverage in January. A nice holiday gift for those facing desperate times. Think they’ll ever vote Republican again?

House Republicans can turn this mess around; but, they had better act quickly. If not, business and consumer confidence as well as voter support may register another new low.

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