Angry House Democrats identified their key objection to President Obama’s tax cut compromise Tuesday night, after they were briefed on the deal in a private meeting by House Speaker Nancy Pelosi and other leaders.
Several members are withholding their support for the legislation unless the details of an estate tax agreement between the White House and Senate Republicans become more progressives.Among them was Rep. Allyson Schwartz (D-PA) — vice chair of the Budget Committee. “My sense is that people are not happy with this,” she told reporters. “Particularly the estate tax is a sticking point for many Democrats.”
In the package Obama negotiated with the GOP, the rate would be set at 35 percent, on estates worth more than $5 million. As a feature of the Bush tax cuts, there currently is no estate tax, but it is scheduled to jump to over 50 percent on estates above $675,000 at the end of the year. Democrats see a middle way: a threshold of $3.5 million, and a rate of 45 percent.
Incoming Budget Committee ranking member Chris Van Hollen (D-MD) needs to see some movement as well. “I have very serious reservations about this package primarily because of the [estate tax] provision we’re talking about,” he told reporters.
Before the meeting, during a House vote, Pelosi ally Henry Waxman (D-CA) told reporters, “They put out this compromise, and I notice Senator Reid says it needs some modifications…. if it’s open to modifications, I’d certainly like to see some as well,” Waxman said. “I particularly am not happy about the estate tax.”
“It’s the biggest of the problems,” Rep. Anthony Weiner (D-NY).
Wiener has been a persistent critic of the Obama administration since the tax cut fight took center stage, but he saved his harshest words for tonight.
“There’s this general sense that we need the President to be the leader of our country, to be the leader of our party, and to be the leader of the values we believe in, and he seems to go from zero to compromise in 3.5 seconds,” Weiner said. “I’m not saying that you never compromise or that you never do deals. This is Washington, that’s how laws get passed. But he just — he and his team just don’t seem to be that good at it. And that’s a real problem for a lot of Democrats.”
Here’s the problem for these Democrats: Before the election, several dozen of their colleagues came out in support of extending all the Bush tax cuts temporarily. If they join an overwhelming majority of Republican members and vote for the package, then they could — could — get it done over the objections of progressives.
“They would have the votes? Maybe,” said Rep. Bill Pascrell (D-NJ).
I asked Weiner, and Rep. Debbie Wasserman Schultz (D-FL) how House Dems can tweak this compromise if it already has enough support to pass the House.
“Where do we get our leverage?” Weiner asked. “The clock, and also that we haven’t fully litigated this.”
Wasserman Schultz put the onus on the Senate. “There’s two chambers,” she said. “You can’t do it without both.”
Their greatest hope might actually come from conservatives who are beginning to defect from the plan. Past a certain point, the more Republicans defect, the more influence these Democrats have — their votes could become necessary to pass a bill. But for now it’s unclear that they will be.