–Senate Expected To Get 60 Votes To End Debate
–Final Senate Voted Expected For Tuesday or Wednesday; Then To House
–Senate Must Decide This Week How To Deal With FY’11 Spending Bill

By John Shaw

WASHINGTON (MNI) – The Senate will hold a key procedural vote at 3
P.M. ET Monday to end debate on the $858 billion tax-cut and spending
package that was negotiated by President Obama and congressional
Republican leaders and has been adjusted slightly to ease Democratic

Sen. Bernie Sanders of Vermont began to make his case for defeating
the bill Thursday night and Friday. Sanders has called the bill a “bad
deal” that should be rejected and is trying to filibuster the bill.

Ending this filibuster will require 60 votes when the Senate votes
Monday afternoon.

If the 60 votes are secured as is expected, the Senate could debate
the bill for another 30 hours, delaying the final Senate vote until
Tuesday or Wednesday.

Before a final Senate vote, Senate leaders may allow for each party
to offer an amendment to the bill, mostly as a way of allowing several
senators a vehicle to express frustration with the package.

If the Senate passes the bill it will be sent to the House for
its consideration. House Democratic leaders remain cool to the package
but have scaled back their fierce criticism of early last week. House
Majority Leader Steny Hoyer Monday morning said he now believes the
House too will pass the tax cut.

The Senate bill reflects the agreement that Obama announced last
Monday evening. It extends all of the Bush era tax cuts for two years
and extends unemployment insurance benefits for 13 months. It includes
the extension of a host of expiring or expired tax credits, including
business tax expensing provisions that are designed to spur growth.

A critical part of the agreement from Obama’s perspective is a 2
percentage point reduction in the employee share of payroll taxes in

The agreement also sets the estate tax at 35% above a $5 million
per person threshold. This is a critical component for some Republicans

The inclusion of a renewable energy grant program and a one year
extension of subsidies for the ethanol industry is likely to ease the
concerns of some House Democrats.

As the Senate goes forward with the package, it remains unclear how
House Democrats will proceed.

It appears likely that Senate passage of the bill would create
enough momentum for the bill so that a coalition of virtually all House
Republicans and at least 50 Democrats will pass the bill in the lower
chamber this week.

Congressional leaders must also decide this week how to handle
funding legislation for fiscal year 2011.

The House last week approved a stop-gap spending bill that would
fund the federal government for the rest of the 2011 fiscal year.

The $1.1 trillion bill was approved by the House on a 212 to 206
vote. No Republican supported the bill and 35 House Democrats also voted
against the measure.

The bill now goes to the Senate where it faces an uncertain fate.

Several Senate Republicans have said they prefer a stop-gap bill
that only runs until February rather than a measure that funds
government for the rest of the FY’11 fiscal year.

This would give the GOP a chance to cut back spending in the new
Congress in which there will be six more Republicans in the Senate and a
substantial Republican majority in the House.

The current stop-gap spending bill extends until Saturday. None of
the 12 regular spending bills have been yet passed by Congress for the
fiscal year that began Oct. 1.

The stop-gap bill passed by the House would fund the federal
government in FY’11 at the same level as FY’10. It shifts some funds
around. The stop-gap bill includes no earmarks and freezes federal pay,
except for the military, for two years.

If the Senate changes the stop-gap bill approved by the House, the
House will have to take up the issue again.

It seems likely the House’s last two major votes at the end of
the week will be the tax bill and another stop-gap spending bill.

Senate Democratic leaders and the White House are also trying to
find time in the Senate to consider the START arms control treaty
between the U.S. and Russia.

The Senate Banking Committee will vote Tuesday afternoon on the
nomination Joseph Smith to be director of the Federal Housing Finance

** Market News International Washington Bureau: 202-371-2121 **

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