Tax Cut Deal Heads to White House
Politico reports:
A tax-cut compromise between President Barack Obama and congressional Republicans – a harbinger of a new era of divided government in Washington – cleared the House around midnight Thursday, sending the $858 billion bill to the president’s desk.
The bill, which passed 277 to 148, provides a two-year extension for all tax cuts that were due to expire Dec. 31 – including for families earning more than $250,000 a year — and extends unemployment insurance benefits through next year. It also sets estate tax rates at 35 percent, with an exemption on the first $5 million.
In the end, the House vote wasn't close, with 139 Democrats joining 138 Republicans to approve the bill. The Senate passed the bill comfortably as well Wednesday, 81 to 19.
The bill represented a major shift for Obama, as he abandoned an oft-repeated campaign promise that he would end the policy of cutting taxes for the wealthy. But the House Republican landslide in the midterm elections – a “shellacking,” Obama called it – forced the president to cut a deal so middle-class families didn’t see a tax hike on his watch, even though it infuriated his liberal base.
The political gamble has paid off for Obama, at least in the immediate term. Polls show the deal is widely popular with Americans, and it has allowed Obama to put space between himself and the liberals in his party – not least congressional Democrats. He has opened an avenue to portraying himself as the reasonable consensus-builder that he promised to be in the heart of his 2008 campaign, something his team seems eager to do after two bruising years marked by the messy fight over health care.
The bill also will be one of the final pieces of legislation taken up by the Democratic majority led by House Speaker Nancy Pelosi (D-Calif.), a champion of the left. And its passage provided a remarkable scene, of Pelosi herself railing against a bill that her majority was powerless to defeat – from the very same spot where she had presided over Obama’s earlier legislative triumphs, health care reform and a crackdown on Wall Street.
