House Dem on hearing: Why are we doing this now?

Lawmakers are currently scrambling to extend the payroll tax cut and a host of other items that expire at the end of the month. Levin and some other congressional Democrats have also lobbied hard for an extension of unemployment benefits.

On Monday, Senate Democrats unveiled a slimmed-down proposal on payroll tax relief. But most Republicans continued to pooh-pooh the plan, maintaining their opposition to the Democrats' plan to pay for the tax holiday with a surtax on millionaires.

For their part, President Obama and congressional Democrats continue to hammer Republicans for not going along with their payroll tax plan, trying to cast the GOP as more interested in tax relief for the wealthy than for the middle class.

The joint Finance-Ways and Means hearing was the second of its kind in some 70 years. At the first, in July, Levin also said the committees had more pressing matters than derivatives taxation — at that time, the looming deadline for raising the debt ceiling.

At Tuesday’s hearing, lawmakers were trying to wrap their heads around how derivatives were taxed, noting that those sorts of financial instruments were far less prevalent when the tax code was last overhauled a quarter-century ago.

A Joint Committee on Taxation report prepared for the hearing said that businesses have a wide range of reasons for using financial instruments but those methods can be manipulated for tax purposes.