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Both Sides Tiptoe Around Tax Cuts

Neither Republicans nor Democrats in the Senate appear to have the appetite for a floor fight before the midterm elections over extending Bush-era tax cuts, making it more likely than ever that the chamber will punt the issue to a lame-duck session.

Though no final decision has been made in either party, Senators said they do not sense a groundswell of momentum for having a debate that is likely to end in defeat for both Democratic and Republican bills.

Instead, Senate Democratic leaders are seriously considering teeing up a vote next week on a bill to punish U.S. companies that move operations overseas.

On Wednesday, Democrats dodged questions about whether a tax cut vote was imminent before an expected adjournment in little more than a week, while the GOP put the onus on Majority Leader Harry Reid (D-Nev.) to make the debate happen — even though Republicans also have the power to force the issue on the floor if they so desire.

“Both caucuses appear to be split on whether to have a vote,” said one Democratic Senator, who predicted it was unlikely the issue would see action before the elections.

Democratic Conference Secretary Patty Murray (Wash.) emphasized that regardless of whether the Senate votes next week or after the elections, “tax cuts will be extended one way or another by the end of the year.”

When asked whether Minority Leader Mitch McConnell (R-Ky.) should use the rules to force Democrats to vote on the issue, Sen. Mike Johanns indicated it was the Democrats’ decision to make.

“It’s really a Harry Reid issue. It is,” the Nebraska Republican said. “He can step up on this and say, ‘We need to get something done here.’ … It’s about Harry Reid doing what I hope a Majority Leader should do here, and that is to bring this to a vote. It’s enormously important to our country.”

Similarly, Sen. Mike Crapo appeared resigned to leaving the issue for the lame duck, saying that scenario is beginning to look inevitable.

“I personally would like to see us have that vote,” the Idaho Republican said. “I have been pushing to make this tax relief permanent ever since we first enacted it. … If we have a lame-duck session, I’ll fight to have it then.”

Last week, McConnell put his own
$4 trillion extension of all Bush administration tax breaks on the official Senate calendar, presumably to preserve his option to go around Reid by filing a motion to force a vote. Though the move is unusual — Senate custom dictates that the Majority Leader decides what comes to the floor — McConnell has attempted on several occasions over the past few years to compel votes when he believes it will work in his party’s favor.

But the GOP leader has so far refused to say what he would like to do, and his spokesman said earlier this week that McConnell did not want to give Democrats any reason to back away from holding a vote on their own.

Reid spokeswoman Regan Lachapelle said Wednesday that Democrats plan to plot strategy again today during a caucus luncheon.

Democrats have not been shy about publicly expressing their disagreements over whether it is politically wise to have a vote on tax cuts before the elections. Republicans continue to insist that they are united against “raising taxes during a recession,” as many have said, but some of their rank and file have declined to say whether they would vote for a Democratic bill that extends tax cuts only for couples making less than $250,000 ($200,000 for individuals).

“I’m not going to get into hypotheticals,” Sen. Scott Brown (R-Mass.) said when asked whether he would vote for both a full-extension proffered by Republicans as well as the Democratic plan.

Plus, some Republicans said the political usefulness of a vote, regardless of whether the caucus is united, is debatable.

“There is some utility to having a vote to make a very clear statement that we are the party that will not raise your taxes in the middle of a recession,” one senior Senate GOP aide said. “That being said, I think the American people already know which party wants to raise their taxes, and it’s not Republicans.”

Democratic Conference Vice Chairman Charles Schumer (N.Y.) acknowledged the rift in his party.

“I think that there is a majority view, but there are many others, and we’re trying to come up with a broad consensus,” Schumer said while declining to say what the “majority view” is.

Most Democrats think it would be helpful for their Members to make the point — in a vote — that they are “for the middle class,” while the Republicans are fighting for tax cuts “for the wealthy,” but some vulnerable incumbents have asked to defer the debate.

Rather than talking about tax cuts, Democratic caucus meetings in the past week have been dominated by talk of a bill that many assert would help the party renew its focus on jobs and the economy. The measure, introduced by Democratic leaders Tuesday evening, would end tax breaks for companies that outsource jobs to other countries.

“It’s just a gigantic problem, and it’s symbolic,” Sen. Jay Rockefeller (D-W.Va.) said Tuesday.

Aides said the debate could replace any vote on Bush tax cuts next week.

“Constituents care more about the economy than anything else,” one senior Senate Democratic aide said. “So the caucus is discussing moving forward on these measures to keep jobs in America instead of shipping them offshore. Doing so might leave less time and opportunities for doing tax cuts.”

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