GOP warns Reid on spending for next jobs bill

Bipartisanship in the Senate could fall to the wayside if Majority Leader Harry Reid (D-Nev.) adds too many spending provisions to his upcoming jobs bill that was originally negotiated by Finance Chairman Max Baucus (D-Mont.) and ranking Republican Chuck Grassley (Iowa), a Senate GOP staffer warns.

“Democrats want the good housekeeping seal of approval on the bipartisan deal, but they like to take the deal more toward their caucus position,” the aide said. “To the extent that the leadership, especially the majority’s leadership, undermines the good faith negotiations [of Finance], the cost of that transaction will be borne on the next legislative transaction.”

The bill that could spark a GOP revolt on bipartisanship could be the jobs package aimed at small businesses Reid could offer as soon as Friday.  The legislation resuscitates several business tax breaks as well as disaster relief through the end of 2010, which the GOP supports.

But conservative support could be lost if Reid adds too many Democratic priorities to the bill, like funding extensions to state for aid related to Medicare, which would skyrocket costs.

“What I’m hearing is Reid’s caucus will take the Finance negotiated bill and blow the costs up by 300 percent… all on long-term extensions of ‘temporary’ entitlement stuff,” the aide said.

Reid has not officially introduced his second jobs bill, but business lobbyists say it will likely include an extension of unemployment benefits through 2010. It will also be offset, at least in part, by clamping down on tax shelters, repealing a tax break abused by the paper industry, modifying the homebuyer tax credit, and allowing companies to delay funding to pensions.