WASHINGTON Dec 8 Republicans in the U.S. House
of Representatives were falling into line on Thursday behind a
bill to extend a payroll tax break for workers after leaders
sweetened the legislation with a provision that has drawn a
veto threat from President Barack Obama.
The bill detailed by House Republican leaders in a closed
door session includes a measure requiring quick approval of the
Keystone XL pipeline that is to carry Canadian oil to Texas
refineries. Obama has delayed approval of the project for a
year to allow more review on its environmental impact.
Obama said on Wednesday he would reject any payroll tax cut
legislation that included the pipeline provision even though
he and his fellow Democrats in Congress believe extending the
tax cut for wage-earners is essential to help stimulate the
sluggish U.S. economy.
The 4.2 percent payroll tax that workers pay to fund the
Social Security retirement system will snap back to 6.2 percent
in January if Congress fails to act.
The pipeline provision and the veto threat may have helped
win conservative support for the payroll tax cut extension.
"It never hurts," Republican Representative Kevin Brady
said when asked if Obama's veto threat helped galvanize
Republicans had been sharply divided over the payroll tax
cut, with conservatives questioning their leaders' support for
continuing the lower rate.
The Republican-led House of Representatives is expected to
vote on the legislation next week. The bill also includes an
extension of unemployment insurance benefits coupled with
reforms of the program and a measure to avert a pay cut for
doctors treating patients on Medicare, the health program for
The Democratic-controlled Senate is set to vote on Thursday
afternoon on its version of the legislation. The Democratic
proposal would cover the roughly $110 billion cost of extending
the payroll tax cut with an extra tax on incomes over $1
The payroll tax cut has been very popular among voters and
analysts have said it could be politically perilous for
incumbents to oppose extension of the tax break ahead of next
Obama has been focusing on economic fairness issues in
speeches across the county. The reluctance by some Republicans
to extend the payroll tax cut has made them vulnerable to
criticisms that they are the party of the rich.
Republicans have focused their economic proposals on
government spending cuts and overhauling the tax code to reduce
top income tax rates.
But the Keystone pipeline provision could put Democrats on
the spot. Voting against the legislation could expose them to
Republican charges that they favor their liberal
environmentalist base over hard-pressed workers who are
struggling to pay bills.