Angry House Democrats voted a resounding “no” Wednesday on the compromise proposal worked out between the White House and the Republican Senate. Although a non-binding resolution, the vote sent a strong message to Vice President Joe Biden, who negotiated the bill and had urged the House to pass as it as read, President Barack Obama, who they think caved to Republican demands on the Bush tax cuts too soon, and the Senate, where Republicans came away mostly agreeable to the compromise that would have not only included the continuation of the Bush tax cuts for two years, but would also have included a revamped estate tax, a reduced payroll tax, individual tax credits, business tax credits, and a 13-month reauthorization for unemployment benefits extensions (which expired at the end of November). House Democrats wanted their colleagues throughout Congress and in the White House to know that there would be changes made to the proposed bill — one in which their counsel was not sought — before they would agree to its passage.
“This message today is very simple,” Rep. Chris Van Hollen (D-MD) told CNN. “That in the form that it was negotiated, it is not acceptable to the House Democratic caucus. It’s as simple as that.”
Congressman Lloyd Doggett (D-TX) added that the “very loud no vote” left him no doubt that Speaker of the House Nancy Pelosi (D-CA) would follow the caucus vote against the compromise bill.
And as Congressmen in both chambers quibble, barter, and negotiate over various provisions in the proposed measure, hundreds of thousands of the long-term unemployed have begun to lose part of their income. Unemployment benefits extensions authorized back in July expired at the end of November, meaning that only those eligible for regular unemployment compensation benefits would continue to receive payouts (but only up to 26 weeks). It is estimated that 2 million people currently receiving long-term unemployment benefits (27 weeks and beyond) will drop from unemployment rolls throughout December — or until Congress votes to reauthorize the extensions.
President Obama announced the compromise bill as a “framework” proposal Monday. Instead of the 3-month extension that had been introduced in the House two weeks ago, the proposal incorporated the 13-month unemployment benefits extension measure introduced by Sen. Max Baucus (D-MT), which had already been shot down twice by Senate Republicans. But the unemployment benefits extensions package wasn’t what was annoying most Democrats.
Many Democrats, especially fiscal conservative Democrats, are set against extending the Bush tax cuts that allow for continued breaks for the nation’s wealthiest 2-3 percent of wage earners. They are also against continuing the estate tax and want it to return to its pre-Bush tax cuts level, which allows for a $1 million inheritance exemption and a 55 percent tax on anything beyond.
Many House Republicans are also opposed to the bill. As it stands, the bill is completely unpaid for, something most Republicans are unhappy with (it adds to the deficit and the national debt), contending that all new legislation and expenditures be offset or balanced with some form of revenue creation. Tea Party Republicans not only see additional debt as a problem but also are against unemployment extensions, believing they contribute to a welfare state and non-productivity.
Department of Labor figures for November reflected nearly nonexistent job creation while the unemployment rate rose to 9.8 percent nationally. Many are seeing the jobless rate reaching a crisis point as the percentage of the unemployed (that the government tracks) that are considered long-term will soon outnumber those on regular unemployment. And it may not get any better anytime soon.
The Federal Reserve recently projected that the unemployment rate would not fall below 9 percent in 2011. Compounding that dire forecast is the sobering statistic that for every job created, there are five applicants.
The Democratic Caucus’ non-binding resolution might send a message to Republicans and Democrats alike that there are members of the House that are displeased with the current negotiated compromise, but the longer they (and their colleagues in both the House and the Senate) show their displeasure and do not do something to reach a compromise, many of the long-term unemployed will continue to be without benefits that are used to maintain their households during the coldest months of the year. And the impact will not be measured in abstract percentage points in ambiguous projections stretched over the next few years. It will be measured in real lives currently struggling to make ends meet.