Senate Dems fail to advance tax extenders bill for the third time

Senate Democrats on Thursday failed for a third time to advance legislation to extend unemployment benefits through November.

The 57-41 vote rejected ending debate on the legislation, which would have sent the bill to a final vote.

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No Republicans voted yes, while Sen. Ben Nelson (D-Neb.), who had also rejected earlier versions of the legislation, voted no. Sen. Joe Lieberman (I-Conn.) voted yes after voting on previous procedural motions. Sens. Robert Byrd (D-W.Va.) and Lisa Murkowski (R-Alaska) were absent.

After the vote, Senate Majority Leader Harry Reid (D-Nev.) repeated comments he made earlier Thursday that the Senate will now move to a small-business bill. Reid said the unemployment benefits would not be added to that bill, but others have speculated that the provisions could still be attached to the small-business measure.

The failure to move the tax extenders package, which also would have renewed scores of individual and business tax breaks, illustrates the extent to which fears about the deficit are dominating the legislative process five months before a midterm election in which Democratic control of Congress will be on the line.

The legislation cost about $100 billion and would have added roughly $33 billion to the deficit by extending unemployment benefits for six months. The cost of the added unemployment insurance was not offset with other tax hikes or spending cuts.

Republicans unanimously voted against the motion, arguing it would add to the country’s ballooning deficit.

“We just can’t keep kicking the can down the street and say, ‘Oh, we’ll take care of it later on. It’ll be offset later,’ ” Sen. George Voinovich, a centrist Republican from Ohio, told The Hill.

“That’s all we’ve been doing these last couple of years, and I’m fed up with it.”

Voinovich, who is retiring at the end of this Congress, had voted for similar extensions in the past and hails from a state with one of the nation’s highest unemployment rates. That he could not stomach the cost to the budget of extending unemployment benefits again shows how budget concerns have overtaken worries about the economy.

Senate Majority Leader Harry Reid (D-Nev.) scaled back the package the Senate rejected on Thursday. The original tax extenders package cost $140 billion and added $80 billion to the deficit.

Democrats on both sides of Capitol Hill ripped Republicans for much of Thursday, accusing them of refusing to help needy families and criticizing them for budget hypocrisy.

Some Democratic senators expressed puzzlement that their conservative counterparts voted for $1.3 trillion in tax cuts during the Bush administration and escalated spending on wars in Iraq and Afghanistan. None of that spending was offset with spending cuts, they noted.

“Now they’re going to make their last stand on deficits by trying to take money away from the unemployed, in terms of extending benefits,” said Sen. Byron Dorgan (D-N.D.). “That’s sort of a bizarre priority as far as I’m concerned.”

Speaker Nancy Pelosi (D-Calif.) blasted Republicans for seeming to have “a tin ear when it comes to the appeals of the American people for job creation.”

But it’s not just Senate Republicans who are worried about increased spending in the face of the nation’s projected $1.5 trillion budget deficit.

Pelosi has been frustrated by opposition from House Democrats, who forced her to scale back a package of unemployment insurance extensions, aid to states and extended COBRA health insurance benefits. Vulnerable members of her caucus did not want to vote to add to the deficit without an assurance that the Senate would follow suit.

Senate Democrats criticized Republicans for using the deficit to gain political points in the run-up to November’s election.

“Somewhere along the line, throughout these charades, this job creating, tax cutting loophole closing bill has become a political football and that is really too bad,” Reid said in comments on the Senate floor.

“The debate is focused on winning and losing and not on doing what’s right, and that’s really too bad.”

Senate Democratic leaders reminded Republicans that when they were in charge they too extended unemployment benefits without offsets.

“This entire proposal is paid for except for unemployment insurance, which in a bipartisan way has always passed unpaid-for through the decades,” said Sen. Charles Schumer (D-N.Y.). “But everything is paid for, so [their argument that the bill adds to the deficit] is no longer an excuse for them. And why are they doing this, it’s beyond us.”

However, not every Senate Democrat supports the idea that leaders should continue the tradition by deeming continued extensions to unemployment benefit an emergency and not offsetting its cost.

“I don’t buy that distinction,” said Nelson. “At some point, it ceases to be an emergency, it’s ongoing… I think the bill should be paid for.”

This story was originally posted at 5:46 p.m. and updated at 8:49 p.m.