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Member Mistrust High on Jobs Bill

Senate Democrats and Republicans are flirting with the prospect of passing a bipartisan jobs bill this month, but both sides appear to be treating the other with kid gloves as they seek to assess the pros and cons of teaming up.

The mistrust between the two parties is high following the highly partisan health care debate at the end of last year and the GOP’s surprising win in the Massachusetts Senate special election on Jan. 19. That election leaves Senate Democrats one vote shy of the filibuster-proof majority they enjoyed for the final six months of 2009.

Democrats anxious to score a bipartisan win have been floating a relatively modest proposal as their first foray into the job creation arena this year. The bill they hope to bring to the floor as early as late this week — but more likely early next week — would include a one-year extension of the highway trust fund, an extension of the Build America Bonds program, a handful of small-business tax credits and, possibly, a bipartisan proposal to suspend payroll taxes for businesses that hire the unemployed. Extensions of unemployment benefits and health insurance portability are also possible.

Though Senate Republicans said they do not have substantial objections to the proposals Democrats are currently floating, they said they are wary of signing on to anything that could be loaded up with other Democratic proposals for direct government spending intended to spur jobs.

“How can they be trusted?— asked one Republican source. “It could be in their interest to jam us.—

The source noted that Republicans “got the shaft— a few notable times in the past year, including when Democrats backtracked on a late 2008 bipartisan deal on the children’s health insurance bill and passed a different measure in 2009. The source also referenced Sen. Olympia Snowe’s (R-Maine) vote in favor of the Senate Finance health care bill and Senate Majority Leader Harry Reid’s (D-Nev.) decision to bring a bill to the floor without her input.

Republicans said they are likely to be highly skeptical of Reid’s plan to quickly move on a targeted jobs package before the scheduled Presidents Day recess, which begins on Feb. 13.

“If you start trying to cram things through, you’re going to run into the same problems you had before and you run the risk of sowing dissension where there need not be dissension,— the senior Senate GOP aide said.

But another senior GOP leadership aide said taking a targeted approach would likely be the key to securing some level of Republican support.

According to this aide, Republicans could end up backing one or more of the Reid’s jobs bills — even if he uses a truncated process — if they are heavily weighted toward tax cuts.

Democratic and Republican aides indicated that Senate Finance Chairman Max Baucus (D-Mont.) is taking the lead in trying to build bipartisan support for the first of several jobs packages, because most of the proposals they would include fall within his panel’s jurisdiction. But some Republicans expressed hope that Baucus would be able to delay floor action by scheduling a markup.

“It’s fair to say that we’d prefer the Finance Committee consider any proposal before it goes to the floor,— one aide to a Finance Republican said. The aide added that cost estimates from the Congressional Budget Office are not yet complete and that offsets for the tax credits in the first measure have yet to be vetted with GOP Finance members.

Baucus had pressed Reid last week to give him up to three months to devise and mark up the proposals, but Reid insisted on moving forward with a package of tax cuts this month. If Republicans threaten to pull their support, however, Democrats said they may delay consideration of the bipartisan new-hire tax credit — sponsored by Sens. Charles Schumer (D-N.Y.) and Orrin Hatch (R-Utah) — in order to make sure that Hatch and other Republicans are fully supportive of the proposal when it does move.

Reid spokesman Rodell Mollineau confirmed his boss’s desire to move forward quickly on a jobs package. “It is our goal to pass a bill that puts people back to work and strengthens the economy before Presidents Day. We will, as we have throughout the 111th Congress, continue to reach out for Republican support,— Mollineau said.

Despite the leadership’s assertions, many Democrats are similarly reluctant to trust Republicans, because they believe the minority has settled on a strategy of obstruction and that the results in Massachusetts only fortified their resolve to vote “no.—

“There is no advantage to the Republican Party to meet us any part of the way,— one senior Senate Democratic aide said.

Even as Senate Republicans are toying with supporting the Schumer-Hatch new-hire tax cut, House Republicans spent the weekend likening the idea — and Obama’s push for it — to policies that ultimately failed during President Jimmy Carter’s administration.

Rep. Paul Ryan (R-Wis.), ranking member of the House Budget Committee, indicated Obama’s latest jobs plan is more of a gimmick than a real solution to the nation’s 10 percent unemployment.

“We’re looking at what works to grow the economy, and this doesn’t work,— Ryan said on “Fox News Sunday.— “And more importantly, the debt and the deficit is just getting out of control. … If borrowing and spending all this money led to more jobs, then we’d be at full employment already.—

Obama on Friday defended the small-business hiring credit as “most cost-effective way for encouraging people to pick up their hiring— and said the “across the board— tax cuts advocated by the GOP might be too expensive to implement.

Brad Dayspring, a spokesman for Minority Whip Eric Cantor (R-Va.), said Republicans are glad Obama has decided to focus on small businesses, but he said the president’s current proposal simply will not work.

“Let’s not confuse direct small-business tax cuts with this Jimmy Carter-style tax credit,— he said. “It’s clumsy, open to fraud and there are far better options.—

The Republican rejection of the Obama plan is not necessarily surprising given their past criticism of the Democratic approach to tax cuts and job creation. In December, House Republicans unanimously opposed a $150 billion jobs package, which the House narrowly approved, 217-212.

John Stanton contributed to this report.

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