Momentum for tax deal builds in Senate as critics leave door open

Leading members of the Senate Democratic conference predict the tax deal struck between President Obama and GOP leaders will pass the Senate, making the House the main battleground.

As of midday Wednesday, only two on the left had said they would vote against the tax package: Sen. Bernie Sanders (Vt.), an independent who caucuses with Democrats, and Sen. Mark Udall (D-Colo.). Sen. Patrick Leahy (D-Vt.) has also strongly criticized the deal "wrong for most Vermonters" and "wrong for our country."

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Democrats who have criticized the deal such as Sens. Tom Harkin (D-Iowa) and Mary Landrieu (D-La.) have left open the possibility of supporting the package in the end.

“I was inclined to vote no but it’s still a work in progress,” said Harkin. “Let’s see what happens, things are happening.”

Harkin would like to see unemployment benefits extended for two years instead of 13 months, as Obama and GOP leaders have agreed. Harkin said the extension of unemployment benefits should mirror the two-year extension of tax cuts for the nation’s wealthiest individuals and families.

He said he was strongly opposed to setting the estate tax at 35 percent for inheritances over $5 million but doubts it would be possible to renegotiate that part of the deal.

Harkin said the package “probably will” pass the Senate.

But it will likely face a tougher fight in the House.

Liberal Democrats in the House have mobilized to defeat the tax deal, which has received strong criticism from progressive advocacy groups and unions.

Thirty-four House Democrats have signed a letter circulated by Rep. Peter Welch (D-Vt.) stating their strong opposition to the deal.

“We oppose acceding to Republican demands to extend the Bush tax cuts to millionaires and billionaires for two reasons,” the lawmakers wrote in a letter addressed to House Speaker Nancy Pelosi (D-Calif.).

They said the deal is “fiscally irresponsible” because it adds “$700 billion to our national debt” and is unfair because it helps wealthy families at the expense of the middle class.

Rep. Chris Van Hollen (D-Md.), who is representing House Democrats in tax talks with senior administration officials and Senate negotiators, has voiced serious reservations about the deal.

In the Senate, by contrast, political momentum has begun to build for Obama’s tax deal. About a dozen Senate Democrats have praised the package or pledged their support.

"I commend President Obama for his leadership in forging this agreement,” said Sen. Jim Webb (D-Va.) in a press release. “The framework agreement for tax cuts and extended unemployment insurance shows great promise in reinvigorating our economy and putting people back to work. The proposal is the ultimate stimulus plan.”

Sen. Joe Lieberman (I-Conn.) has called the deal “the best that could have been done” and said “it will be good for our economy.”

Democratic Sens. Evan Bayh (Ind.), Bill Nelson (Fla.), Ben Nelson (Neb.), Max Baucus (Mont.) and Tom Carper (Del.) have also spoken favorably of the deal.

Senate Budget Committee Chairman Kent Conrad (D-N.D.) warned that failure to pass the package would reduce economic growth by as much as 50 percent next year, citing projections from economist Mark Zandi.

Conrad said he strongly opposed the deal Obama and Republicans struck on the estate tax. He would prefer to tax estates above $3.5 million at a 45 percent rate, but said significant revisions to the package are unlikely.

“It’s very hard for me to see how this deal gets changed,” he said.

Conrad predicted the package would pick up enough bipartisan support to clear a filibuster planned by Sanders and Jim DeMint (R-S.C.).

“I can’t speak for the House,” he cautioned, reflecting the view of other Democrats that the deal will face a tougher fight in the lower chamber.

Senate Republican leader Mitch McConnell (Ky.) predicts the vast majority of his conference will support the deal. So far only DeMint and Sen. George Voinovich (Ohio) have stated their opposition, according to senior GOP aides.

But some House lawmakers think Senate approval of the framework and the desire to adjourn a week before Christmas will give the package enough momentum to clear the House.

House Democratic leaders have asked the Senate to act first on the proposal.


—Jordan Fabian contributed to this report.

-- This story was updated at 4:10 p.m.