By Jay Heflin - 06/09/10 12:32 AM EDT
Senate Democratic leaders on Tuesday expressed confidence they can pass the tax extenders bill through their chamber next week.
“We’re going to pass this good jobs bill that is on the floor,” said Senate Majority Leader Harry Reid (D-Nev.).
The bill introduced by Senate Finance Committee Chairman Max Baucus (D-Mont.) deviates from the House-passed version by extending $24 billion in state aid for Medicaid and easing the tax burden on so-called carried interest paid by hedge fund managers, venture capitalists and real estate partnerships.
Sen. Charles Schumer (D-N.Y.) argues that the provision adds a layer of fairness to the tax code.
“It goes across the board,” he told reporters. “It affects private equity and hedge funds. It affects real estate. It affects venture capital. And that’s how it should be.”
Schumer said Tuesday that Reid will have the 60 votes necessary to pass the bill, even though no Republicans have indicated support.
Given the Senate’s composition, Democrats will need at least one crossover vote. But Minority Leader Mitch McConnell (R-Ky.) predicts that securing even that one will be difficult because of qualms over the bill’s cost.
“I can’t predict the outcome of the vote, but I do know that there is a growing feeling in our conference, which we’ve demonstrated in recent weeks, that these packages ought to be paid for,” McConnell said. “It seems like every bill that comes across the Senate floor expands the deficit.”
The extenders bill certainly does that. Its price tag of roughly $140 billion adds $77 billion to the federal deficit, a figure some GOP centrists find troubling.
Sen. Susan Collins (R-Maine), a centrist Democrats hope to win over, expressed reservations.
“It’s my understanding that a majority of the bill is still not paid for, so that’s a problem,” she told The Hill.
Senate Minority Whip Jon Kyl (R-Ariz.) said Republican resistance would likely remain until more of the legislation is paid for.
“I think that virtually all Republicans oppose the bill in the form it was introduced here this morning,” he said Tuesday.
Some Democrats are equally uncomfortable that the bill is not fully offset. Sen. Ben Nelson (D-Neb.) has disapproved of the way his own party leaders have classified nearly every spending item as an emergency measure to avoid paying for it.
“Priorities are priorities, but emergencies are emergencies. They’re not always the same,” he said this week.
Other Senate Democrats would still like to see changes on the carried interest provision.
Sen. Tom Carper (D-Del.) would like to see more of a concession for those who use their own money in investment strategies.
“I believe there needs to be a compromise that provides a somewhat lower tax rate for those who have their own money — their own skin in the game — and they have their own skin in the game for half a dozen years or more,” he said.
Senators will be allowed to amend the bill, and McConnell said his party will take full advantage of the chance.
Reid plans to tweak the bill by supporting an amendment that extends the “doc fix,” a term describing a delay in cuts to Medicare reimbursement to doctors. The bill currently extends the measure for 19 months, but Reid said he plans to support a proposal that would extend the fix even beyond that.
“I want to move on that,” he said. “There is some feeling on the Senate side that there’ll be an amendment offered to increase it to at least three and a half years.”