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Senate Passes Payroll Tax Cut & Unemployment Extension — Oh, and Something About a Pipeline

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By Doug Powers  •  December 17, 2011 11:15 AM

**Written by Doug Powers

Early next week should be interesting. This morning the Senate passed a payroll tax cut and unemployment extension. The legislation also contains the job creator that dare not speak its name:

Senators racing for the exits after a year of bitter battles passed legislation Saturday that would extend a Social Security payroll tax cut and jobless benefits for just two months, setting the stage for the next fight until February.

While a partial victory for President Barack Obama’s year-end jobs agenda, the measure awaiting House approval next week contains a provision demanded by Republicans to pressure the White House into approving construction of a Canada-to-Texas oil pipeline that promises thousands of jobs.

Democratic and GOP leaders option for the short-term extension after failing to agree on big enough spending cuts to pay for a full-year renewal of the payroll tax cut. The 2 percentage point tax cut affects 160 million taxpayers. The weekly jobless payments average about $300 for millions of people who have been out of work for six months or more.

The measure was approved by an 89-10 vote during a Saturday session.

The bill gives Obama 60 days to decide about the Keystone pipeline — which is not-so-coincidentally the same amount of time before Congress will have to extend the temporary bill again.

So, how badly does President Obama want to get out of town and join his family in Hawaii? At yesterday’s White House press briefing, Jay Carney seemed to be backing off any veto threat for a bill containing the Keystone provision:

Q: It sounds like you’re saying that you would not rule out the President signing a bill for an extension of the payroll tax break that would include language related to the Keystone project? Is that correct? You’re not ruling that out?

MR. CARNEY: I’m not here to go beyond anything we’ve said with regard to this matter already, which is the President’s statement, the assessment by the State Department of the specific language in the House Republican bill, and I think the point I made yesterday or the day before about the company that’s requesting the permit, noting that they haven’t even identified an alternate route yet so the whole 60-day thing is pretty specious.

Having said that, there is a process at work — I’m not going to analyze what language would be acceptable and what wouldn’t. I will let the process run its course.

Meanwhile, “greens” are so upset that the White House is even entertaining discussion about the pipeline that they might not support Obama’s re-election, a threat that will be in effect right up to the point where they vote for Obama again next year anyway:

For greens, the fact that the Keystone pipeline was back on the table five weeks after Obama had seemingly punted it until 2013 is causing considerable heartburn with an administration that hasn’t been as green as they once wished.

Their initial win looked even better because it came just days after thousands circled the White House at a weekend protest that drew celebrity faces like actor Mark Ruffalo. But now Obama’s environmental allies again face the question of whether to withhold support for his reelection campaign.

Personally I think this is just a cheap attempt by the White House to get another chance to meet Julia Louis Dreyfus.

More than likely Obama will kick the can a few weeks down the road by signing the bill, quickly attempting to placate greens by claiming Republicans have added the environment to their list of hostages but pledge to still fight the pipeline, then hop on Air Force One and head for the Islands. That or just leave now and let autopen work its magic.

**Written by Doug Powers

Twitter @ThePowersThatBe

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