Senate leaders agree on short term payroll tax cut

Obama and the Democrats didn't get a tax increase or force the removal of the pipeline from the final package. In short, a victory of sorts for senate Republicans.


Senate leaders agreed on compromise legislation Friday night to extend Social Security payroll tax cuts and jobless benefits for two months while requiring President Barack Obama to accept Republican demands for a swift decision on the fate of an oil pipeline that promises thousands of jobs.

A vote is expected Saturday on the measure, the last in a highly contentious year of divided government. House passage is also required before the measure can reach Obama's desk.

In a statement, White House communications director Dan Pfeiffer indicated Obama would sign the measure, saying it had met his test of "preventing a tax increase on 160 million hardworking Americans" and avoiding damage to the economy recovery.

The statement made no mention of the pipeline. One senior administration official said the president would almost certainly refuse to grant a permit. The official was not authorized to speak publicly.

Racing to adjourn for the year, lawmakers moved quickly to clear separate spending legislation avoiding a partial government shutdown threatened for midnight.

Obama was threatening to veto any bill that contained pipeline authorization but dropped that demand when even some Democrats indicated they want the project to procede. The president may yet put a damper on the project by claiming that it would not be in the "national interest" to build the pipeline and deny the necessary license.

All in all, not a bad deal when you consider the president caved on tax increases and the pipeline. The fact that the deal will only be for two months means we get to do this all over again in February.

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