White House backs Senate payroll bill over House objections

The White House is throwing its weight behind a Senate compromise for a two-month extension of the payroll tax cut, despite strong objections from House Republicans that could unravel the deal.

The director of the National Economic Council, Gene Sperling, voiced skepticism on Sunday that the House could change the bill and get it to the president’s desk by Christmas.

President Obama had long pushed for a full one-year extension of the payroll tax cut, unemployment insurance benefits and other measures. But Sperling pointed to the “overwhelming” vote Saturday in the Senate for a two-month extension and warned the House against risking a tax increase on 160 million Americans by not accepting it

“Of course the president would like more, but here is what is significant about the vote yesterday: It had 89 votes,” Sperling said on CNN’s “State of the Union.” “The only things that get 90 percent support in the United States Senate these days are Mom, apple pie and chocolate ice cream. So I really think it is very unlikely that the House would disrupt this compromise, overwhelming compromise six days before Christmas.”

But the House may well do that. On a conference call briefing on Saturday, both House GOP leaders and rank-and-file lawmakers voiced extreme opposition to the Senate bill. The lower chamber will return to Washington on Monday evening and could amend the Senate legislation or force a conference committee to reconcile the differences between that version and a House bill that called for a one-year extension of the payroll tax cut.

Sperling did not completely rule out a full-year extension before the holidays. “This is Washington DC. You don’t categorically rule out anything,” he said.

Echoing the president’s comments on Saturday, Sperling said that since there was such strong bipartisan support for extending the payroll tax cut for 60 days, he saw little chance the deal would be derailed. “The chances are very small that we would not come to, as the president said, a no-drama compromise to extend it for the full year,” he said.

Yet that prediction flies in the face of everything that has occurred in Congress this year, where even routine matters and aid for disaster relief have become embroiled in partisan bickering and brinksmanship.

Sperling also said Obama was not backing off a veto threat by endorsing the Senate bill, which includes a GOP provision forcing his administration to expedite a decision on the Keystone XL oil sands pipeline after it initially delayed a decision until after the 2012 elections. The president had vowed to “reject” legislation that tied the Keystone pipeline to the payroll tax cut, but Sperling said Sunday that Obama’s threat only applied to a bill that forced him to grant a permit for the project. 

The Senate bill merely requires a faster decision, and the State Department, which is in charge of review, has said the 60-day timeline would virtually guarantee that the permit is not granted.

Sperling said Obama would have rejected a provision to “mandate or force him to accept the Keystone permit when there was not adequate time to do a health and safety and environmental review.”

“Nothing in this bill mandates the president to do that,” he said. “Whether wise or not, this did not go against his veto threat or his core principle of making sure that we do not see taxes going up on 160 million Americans when the economy still needs to strengthen much further.”