Friday, December 16, 2011

Last Call

As a man much wiser than myself once sang, "You can't always get what you want."

Senate leaders have agreed to a plan that will prevent key policies, including a two percent payroll tax cut for employees, from lapsing on January 1, 2012, according to top aides. But the agreement will only extends the measures for two months, setting Democrats and Republicans up to relitigate this same fight fight early next year. And it comes at a political cost to Democrats who were forced to relent on a provision forcing President Obama to take a public position on the Keystone XL oil pipeline.

The $30 billion package will be paid for by increasing the fees lenders pay to mortgage giants pay to Fannie Mae and Freddie Mac. It includes two month extensions of the existing two percent payroll tax; emergency unemployment benefits; and the “doc fix” which prevents Medicare physicians from experiencing a deep automatic pay cut.

In a political hit for Democrats, Republicans insisted on and secured a provision that requires the Obama administration to either greenlight the Keystone XL oil pipeline or for President Obama to publicly nix it by declaring it not in the national interest. Sources indicate that Obama could deal with this requirement without forgoing a chance to revisit the issue after the election, as the administration originally planned.

Neither side is going to be happy with this deal, which considering what's at stake here, it's as good as it's going to get.   The mess will continue in two months.

Happy holidays, I guess.

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