House Dems Pass Only Middle Class Tax Cut Bill

December 2, 2010 10:56 a.m.

Using a wily procedural maneuver to tie Republican hands, House Democrats managed to pass, by a vote of 234-188, legislation that will allow the Bush tax cuts benefiting only the wealthiest Americans to expire.

Democrats were not united on the issue. Twenty voted with Republicans to kill the tax cut bill, as they hold out for extending additional cuts to wealthy Americans — though 3 Republicans, including Reps. Ron Paul (TX) and Walter Jones (NC) voted for the tax cut extensions. However the outcome will (and was designed to) allow Democrats to draw distinctions between themselves and Republicans during the 2012 election cycle.

President Obama endorsed the plan many months ago, and continues to support it. But divisions within his party, the White House’s soft push, and the new political reality after the November election have made it highly unlikely that this legislation will become law. It would need to overcome a filibuster in the Senate, and Democrats lack the 60 votes they’d need to do that.[TPM SLIDESHOW: More Than Just Forms: Tax Day Tea Party-Style]

But time was of the essence. The 2001 Bush tax cuts expire at the end of this year, and Democrats have shown no stomach for allowing them to lapse, which would force the next Congress to get down to brass tacks on the issue in early January.

Congressional leaders of both parties, along with top White House advisers are continuing negotiations to reach a compromise — particularly in the Senate, where this bill isn’t expected to get very far — and Republicans are driving a hard bargain in those negotiations. Even Democratic sources predict that all the cuts will, in the end, be extended temporarily in exchange, perhaps, for a few key items like an extension of unemployment insurance and ratification of the START treaty. But that outcome would likely punt the question of whether to let the tax cuts for the wealthiest Americans lapse into another election year.

UPDATE: White House spokesman Robert Gibbs issued this statement after the vote:

“The President continues to believe that extending middle class tax cuts is the most important thing we can do for our economy right now and he applauds the House for passing a permanent extension. But, because Republicans have made it clear that they won’t pass a middle class extension without also extending tax cuts for the wealthy, the President has asked Director Lew and Secretary Geithner to work with Congress to find a way forward. Those discussions started just yesterday and are continuing this afternoon. The talks are ongoing and productive, but any reports that we are near a deal in the tax cuts negotiations are inaccurate and premature.”

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