The following is a scenario being discussed (at least at the Huffington Post):
Senate Leader Reid first would let the Senate vote on the Republican plan to extend income tax cuts for all (the bill includes the Kyl-Lincoln proposal of a phased in $5,000,000 estate tax exemption with 35 percent rate). This would give political cover to several Democratic Senators, such as Nelson, by allowing them to vote for extension of the tax cuts for all. The bill would be defeated (Reid had better count the votes first very carefully, however), coming just short of a majority.
Next, the Democrats would bring to a cloture vote in the Senate the Democratic proposal extending the income tax cuts for all but the more well off. This bill supposedly would include the $3,500,000 estate tax exemption with a 45 percent rate. The key, of course, will be whether they get a Republican or two to vote for cloture (cutting off the certain Republican filibuster), as well as keeping all the Democrats on board.
The rationale of the above is to give political cover to the Democratic senators who need to vote for extending the tax cuts for all. They can then vote for the Democratic bill stating they will not “hold hostage” the middle class income tax cut extension because of their ideologically “pure” belief in not raising anyone’s taxes at this time.
Hence, for the estate tax, the key will be can the Democrats get some Republicans to allow a vote on the middle class only (and estate tax) extension? They possibly can, they just got two votes on the small business bill.
We shall see.
By Kevin Staker