Dems, GOP deadlocked as adjournment draws near

[Soldier4Christ]

Dems, GOP deadlocked as adjournment draws near 
Congress brought to grinding halt by hardening stances on taxes, spending

Congress has been brought to a grinding halt by hardening Democratic and Republican stances on taxes and spending just days before lawmakers begin leaving Washington for Christmas and New Year’s.

The two sides are, in some cases, refusing even to speak to each other about the massive omnibus and an Alternative Minimum Tax (AMT) bill.

Senate Republicans refused to meet Democrats Tuesday on spending and House Democrats rejected the Senate’s AMT “patch,” preparing a new version paid for with corporate tax increases.

Senate Minority Leader Mitch McConnell (R-Ky.) countered the majority’s plans with a proposal that would require Democrats to accept virtually all of President Bush’s demands on spending.

McConnell demanded that Democrats also provide $70 billion for the war with no strings attached.

Frustration boiled over in the Senate, where Majority Leader Harry Reid (D-Nev.) said Bush “is impossible — and has been for seven years — to deal with.”

Reid sought to portray senior White House adviser Ed Gillespie as an incarnation of Karl Rove and a mastermind of intransigence.

 The majority leader disdained McConnell’s proposal, noting that an earlier Republican effort to increase war funding without restrictions failed to pass. Reid was not ready to accept an across-the-board funding cut to pare the omnibus to Bush’s ceiling.

Senate Republicans rejected in advance a proposal from House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) to raise taxes to pay the $50 billion cost of the AMT patch. Rangel sought a higher tax rate on offshore deferred compensation. The Senate rejected a Rangel plan this year that paid for the patch by raising taxes on private equity and hedge funds.

When asked if Senate Republicans could accept AMT relief accompanied by tax increases, Sen. Jon Kyl (Ariz.), the Republican whip-elect, replied simply: “No.”

Sen. Lindsey Graham (R-S.C.) said there was “zero” chance of the Senate passing an AMT bill that included tax increases.

Sen. Ron Wyden (Ore.), a Democratic member of the Finance Committee, said it would be difficult to pass a package with tax increases. The patch would temporarily protect 23 million American taxpayers from becoming subject to the AMT.

House Democrats are firm in demanding new taxes to pay for the $50 billion cost of AMT relief. Two leading liberal lawmakers circulated a letter among colleagues seeking to pressure Democratic leaders.

“As progressive members of the Democratic Caucus, we wish to make clear our concern with any AMT patch that does not adhere to the House PAYGO rules,” wrote Rep. Lloyd Doggett (D-Texas), a member of Ways and Means, and Rep. Peter DeFazio (D-Ore.). “We believe House Democrats must remain united on this principle.” 

Mobilization by liberals reinforces a coalition of House Democrats from across the political spectrum pressing Speaker Nancy Pelosi (D-Calif.) to stand firm.

More than 30 conservative Blue Dog Democrats signed a letter to Pelosi and House Majority Leader Steny Hoyer (D-Md.) urging them to pay for tax relief.

“Under no circumstance will we vote for any piece of legislation that does not meet the requirements of PAYGO, nor will we vote to waive the PAYGO rules to allow for such legislation,” they wrote, referring to budget rules that require the cost of bills be offset with tax increases or spending cuts.

Rep. Ellen Tauscher (D-Calif.), chairwoman of the New Democrat Coalition, also demands an AMT bill that conforms with budget rules. “I want AMT paid for. I think the entire Democratic Caucus wants the AMT paid for. I am very resolved to that.

“I’m very mindful of the number of constituents damaged if we don’t get this fixed … [people] also want [tax relief] paid for because they are deeply concerned about the way the Republicans ran the Congress.”

Federal debt has soared during the Bush presidency. Republicans say deficit spending was needed after the Sept.  11, 2001 terrorist attacks and the ensuing recession.

Tauscher said Senate Republicans need to recognize that a new party controls Congress, and compromise.

“I would remind them we took the majority and decided we were not going to run the government as they did, as profligate spenders,” she said. “They need to be cooperative.”

Democratic House leaders, including Pelosi, Hoyer and Appropriations Committee Chairman David Obey (D-Wis.), met Tuesday to discuss strategy. Pelosi also met Reid to discuss spending and taxes.

But they do not appear to have decided how to break the impasse.

Obey has proposed reducing the cost of the omnibus to Bush’s proposal and cutting all lawmakers’ earmarks to spare a variety of programs from cuts. He hopes rank-and-file Republicans will press their leaders to accept higher domestic spending to save projects slated for their districts, said a Democratic aide.

Reid was not embracing that idea when asked about it Tuesday.

[Soldier4Christ]

House, Senate Dems in stalemate over AMT bill

House and Senate Democrats are still wrangling over how to provide a temporary fix to the Alternative Minimum Tax originally intended for the richest Americans but now threatens an estimated 23 million middle-class taxpayers. Republican Congressman Tom Price says his Democratic colleagues' unwillingness to pass a temporary fix to the AMT without raising other taxes is just one in a long list of failures from what he calls a "Congress of irresponsibility."



The House has once again passed a one-year patch to the Alternative Minimum Tax (AMT) that is offset with tax increases. Majority Leader Steny Hoyer (D-Maryland) says House Democrats want the tax hikes in the AMT bill so they can abide by their party's "pay as you go" budget rules. However, the measure is likely to be rejected by the Senate, which wants an AMT bill with no new taxes. Republicans warn that while Democrats in the House and Senate are dickering over what Capitol Hill refers to as "pay-go," they are delaying tax refunds for millions of Americans.

Representative Randy Kuhl (R-New York) says he finds it hard to agree to permanent tax increases to fix a temporary tax. "This argument [that] you have to have offsets is a bogus argument," Kuhl says bluntly, explaining that "pay as you go" for new programs means putting the funding mechanism in place so that the programs do not build up the debt.

While Kuhl says he does not have a problem with that fundamental concept, he admits he does have a problem with a philosophy which mandates "that you've got to put new taxes in place to remove an old tax that wasn't really there in the first place."

Kuhl's colleague Dr. Tom Price (R-Georgia) notes the Internal Revenue Service warned Congress that it needed to have definition by the middle of November in order to have the appropriate forms available to Americans for their tax returns.

"[But] because this Congress didn't act, because the Democrat leadership didn't act, because they wanted to just play politics and put politics ahead of people, we don't have a resolution to it -- and so tax refunds will be delayed, without a doubt," he says. "People will likely be getting the wrong kinds of forms that they need; or [it] will delay the time for filing of individuals' taxes. Although [the Democratic plan] sounds good on its face, the consequences of that are just horrendous."

Price says it is "remarkable irresponsibility" on the part of the Democratic leadership -- and believes "the American people are paying attention."

Senate Minority Leader Mitch McConnell says House Democrats are "playing political games" and is urging them to "take up the Senate-passed AMT patch immediately, or explain to taxpayers why they are delaying refunds for tens of millions of American families."