A lot is going on but nothing is going on. The (Democratic) House passed the income tax cut extension for middle income taxpayers but left out the estate tax fix in the bill. The Democrats in the Senate are trying to take up the bill. Because of a procedural delay that will not happen until tomorrow. Senator Baucus intends to submit an amendment to the House bill with the estate tax fix. He also has introduced his own comprehensive tax bill that includes the estate tax fix because neither will get the needed 60 votes.
I guess there truly is something going on. However, the word is the votes on the amended House bill and the Baucus bill will be simply a symbolic political exercise by the Democrats to make the Republicans vote against the middle class tax cut. The Democrats do not have the 60 votes to override the certain filibuster.
Amazing how they erred on this. I believe they surely could have picked off enough Republican Senators before the election to pass such a bill. However, the Republicans are now solidly together in opposition (Snowe and the other moderates now afraid of primary election challenges from the Tea Party).
The Administration officials, Geitner and Lew, have been meeting with the four representatives from Congress. The Hill and a number of other media outlets report they have a deal and that deal would include the estate tax fix, $3.5 million exclusion. However, all sides stating no deal yet. I suspect they have a deal except the Republicans are bawking at the $150 billion in liberal sweeteners the President is demanding (unemployment extension, continuation of Make Work Pay, and a college program).
The Washington Post reports there is a separate back channel negotiation that has been going on between the White House and staffers in Senate Republican leader Mitch McConnell’s office. Sounds like they have been discussing the same issues.
I still give it a 50-50 shot on the estate tax fix. Maybe even higher. The President seems determined to get a deal no matter what. Likely will include the estate tax fix. However, he has shown to be an ideologue and may draw a line in the sand if he does not get his $150 billion. Then, I believe he would win the game of chicken with the Republicans if he had the guts. However, I am afraid in such a scenario the estate tax would be lost in the shuffle.
We shall see.
By Kevin Staker