–Senate Minority Leader Urges Sen. Reid To Appoint Conferees
–Sen. McConnell: House Would Then Pass Senate Compromise
–President Obama, Speaker Boehner Chat On Phone

By John Shaw

WASHINGTON (MNI) – Senate Minority Leader Mitch McConnell offered
Thursday a compromise plan to end the impasse on the payroll tax cut
extension that appears largely designed to help House Republicans get
out of a corner they have painted themselves into.

In a statement, McConnell said that Senate Majority Leader Harry
Reid should appoint the Senate Democratic members of a future conference
House-Senate conference committee that will be charged to draft a one
year payroll tax cut extension.

In return for Reid doing this, the House would pass the Senate’s
compromise plan that would extend the payroll tax cut package for two
months, McConnell proposed.

“Leader Reid should appoint conferees on the long-term bill and the
House should pass an extension that locks in the thousands of Keystone
XL pipeline jobs, prevents any disruption in the payroll tax holiday or
other expiring provisions and allows Congress to work on a solution for
the longer extensions,” McConnell said.

McConnell issued his statement Thursday just after House Speaker
John Boehner and House Majority Leader Eric Cantor said at a briefing
that they could negotiate a final payroll tax cut extension package with
President Obama and congressional Democrats very quickly and easily.

At the briefing, Boehner urged Senate leaders and the White House
to “sit down and have a serious negotiation” over the payroll tax cut

“Let’s finish this bill,” Boehner said.

“We need somebody to work with,” the Speaker said, adding “let’s
sit down and resolve the differences.”

Boehner called Obama Thursday and suggested that the White House
send negotiators to Capitol Hill immediately to begin talks on the
payroll tax cut extension.

According to a Boehner statement, Obama rejected this idea.

The House voted Tuesday to reject the Senate’s compromise bill that
would have given a two month extension to last year’s payroll tax cut,
renew unemployment insurance benefits and prevent a sharp cut in doctor
payments under Medicare.

The House also voted Tuesday to reaffirm its support of the
Republican package would extend for one year the current 4.2% payroll
tax rate for employees and renew unemployment insurance benefits for
workers who have been unemployed for more than six months. The plan
would extend for two years the so-called “doc fix” to prevent Medicare
payments to doctors from being cut by more than 27%.

The House GOP plan would also remove barriers to construction of
the Keystone XL project and delay a new pollution standard for
industrial boilers.

The House GOP package would cost about $195 billion, with about
$120 billion of the cost coming from the payroll tax cut extension. The
package is paid for by a host of spending savings including minor
adjustments to the Social Security and Medicare programs and fees
imposed on Fannie Mae and Freddie Mac. It would also freeze the salaries
of civilian federal workers through 2013.

Reid has said the Senate has already passed a bipartisan compromise
plan and he will not enter into yet another round of talks with the GOP.

The Senate approved Saturday on an 89 to 10 vote a payroll tax cut
package that Reid and McConnell negotiated.

Senate leaders were unable to reach a broad agreement that would
have funded the package for a full year, so they agreed to extend
various programs for two months.

The scaled-back package would cost about $40 billion and would be
paid for by higher fees that Fannie Mae and Freddie Mac charge to
mortgage home lenders.

There have been reports that McConnell is urging Reid to name
Senate Democratic members to the House-Senate conference committee to
negotiate the one year bill and in exchange for this the House would
vote on the Senate’s compromise bill.

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

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