A tense impasse among Democrats and Republicans in the U.S. Congress and
with President Barack Obama over extending a key tax cut for Americans
has ended. The end of the political drama averts a tax increase 160
million Americans would have faced on January 1.
The break came when Republicans in the House of Representatives bowed to
White House and public pressure and calls from within their own party to
compromise and end what had become an embarrassing end of year struggle
for a Congress with record low public approval ratings.
Earlier, lawmakers on both sides stuck to their positions. House Speaker
John Boehner and Republicans insisted on a full year extension of the
temporary payroll-tax cut, rather than two-months approved by the
President Obama held a news conference to highlight financial costs to
Americans of a tax increase. House Republicans were also pressured by
the Senate Republican leader, Mitch McConnell.
Boehner outlined the agreement to his members late Thursday. It locks in
the two-month extension with technical changes to help small businesses
implement it, and clears the way for House-Senate negotiators to work
out a full one year extension after January 1st.
On Capitol Hill, Boehner insisted to reporters that Republicans were
correct in waging the risky political battle. "We were here fighting for
the right things. It may not have been politically the smartest thing in
the world, but I'll tell you what, I think our members waged a good
fight, we were able to come to an agreement, we were able to fix what
came out of the Senate," he said.
In a written statement, President Obama congratulated lawmakers for
"ending the partisan stalemate" saying it would allow the average family
to keep a tax cut worth about $1,000. He urged Congress to reach an
agreement "without drama or delay" to extend the tax break through 2012.
Earlier, Mr. Obama appeared with a group of Americans he said would be
negatively effected if Congress failed to avoid a tax increase. He said
the impasse was an example of why Americans are frustrated with
Washington. "Has this place become so dysfunctional that even when
people agree to things, we can't do it? It doesn't make any sense. So
enough is enough," he said.
Boehner said he hopes to have the two-month extension taken up by
unanimous consent. This would clear the way for a quick vote in the
House of Representatives as early as Friday, moving the measure to an
equally rapid vote in the Senate, most of whose members have already
left Washington for the holidays.
Like the legislation the Senate approved in a strongly bipartisan 89-10
vote, the House measure would also ensure that nearly 2 million
unemployed Americans continue to receive federal assistance, and avoid a
reduction in payments doctors receive from the government under the
Resolving the impasse was a priority for President Obama who warned that
failing to renew the tax cut would harm a fragile U.S. economy. It also
clears the way for Mr. Obama to join his family in Hawaii for the
Mr. Obama would sign both the House-Senate tax measure, and other
legislation keeping the U.S. government running for the rest of the
current 2012 fiscal year.
The high stakes standoff also carried big risks for Republicans who were
warned by some key conservative political voices that their stance was
helping Mr. Obama in a presidential election year.
The president's public approval ratings have risen in recent weeks, a
result political analysts say of his vigorous statements delivered
across the country about the importance of sustaining the middle class,
and his criticism of Republicans who he has said favor the wealthy.