Unless Republicans in Congress drop their opposition to a bipartisan compromise on extending the payroll tax cut and Unemployment Insurance, America will usher in the new year by raising taxes on 160 million workers and cutting a lifeline to nearly 3 million Americans who are looking for a job.
Congress has until Jan. 1 to extend the tax cut, or 160 million Americans will see less money on their paychecksand more than 3 million unemployed Americans could see their benefits disappear January 1st, but without action the American economy could take a massive downturn.
“Last year, we extended emergency benefits for 7 million Americans. We saw an uptick in job creation, and the Census Bureau said we kept 3.2 million people from falling into poverty,” said Secretary of Labor Hilda L. Solis. “I’ve met many Unemployment Insurance claimants. They are not freeloaders. They are hardworking people. They spend all day, every day, filling out applications, sending out resumes and looking for work. Cutting their lifeline as the holidays approach to win a political game is the wrong approach for this country.”
The tax cut, a top priority for President Barack Obama, would save the average American family $1,000 dollars on their paychecks next year.
After passionate debate, 89 senators — including more than three-fourths of Senate Republicans — voted to to pass a deal that extends unemployment benefits and the payroll tax break.
On Tuesday by a vote of 229-193, House Republicans rejected the bipartisan Senate compromise — effectively killing it — and throwing Washington into further disarray just days before Christmas.
The action prompted a rare outburst from President Barack Obama who accused House Republicans, and Speaker John Boehner in particular, of playing games.
“I saw today that one of the House Republicans referred to what they’re doing as ‘high stakes poker,’ ” Obama told reporters. “He’s right about the stakes. But this is not poker. . . . This is not a game for the average family who doesn’t have 1,000 bucks to lose. It’s not a game for somebody who’s out there looking for work right now and might lose his house if unemployment insurance doesn’t come through. It’s not a game when the millions of Americans take a hit when the entire economy grows more slowly because these proposals aren’t extended.”
Economists widely agree that if lawmakers fail to extend these benefits, consumers are likely to slow down their spending, putting the nation’s slow economic recovery at risk once again.
The payroll tax affects some 4.6 million New Jersey workers, plus the Senate bill would have extended benefits to about 120,000 unemployed state residents and prevented a 27 percent Medicare reimbursement cut to doctors.
The Senate is out of session for the year, and Majority Leader Harry Reid said: “My House colleagues should be clear on what their vote means today… in ten days, 160 million middle class Americans will see a tax increase, over two million Americans will begin losing their unemployment benefits, and millions of senior citizens on Medicare could find it harder to receive treatment from physicians.”
Seven Republicans joined Democrats in opposition to the tax hike on workers and unemployed Americans, but none of them from New Jersey.
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