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How the Two-Month Payroll Tax Extension Helps Obama

President Obama wanted a one-year payroll tax extension. Instead, he got something even better – a Senate-approved two-month extension bill. The legislation immediately sent House Republicans into a revolt, and they’re now fighting for exactly the useless, one-year extension Obama initially called for. They’re also hurting themselves politically in the process.

If the way House Republicans are handling the payroll tax issue is aggravating to conservatives, you can imagine how independent voters are viewing it. Which is why it’s hard to disagree with the Wall Street Journal’s advice to the House GOP: cut your losses, pass the extension, and go home.

At this stage, Republicans would do best to cut their losses and find a way to extend the payroll holiday quickly. Then go home and return in January with a united House-Senate strategy that forces Democrats to make specific policy choices that highlight the differences between the parties on spending, taxes and regulation. Wisconsin freshman Senator Ron Johnson has been floating a useful agenda for such a strategy. The alternative is more chaotic retreat and the return of all-Democratic rule.

House Republicans have bungled this miserably. The WSJ is right that the best strategy is probably to stop digging. But from a political standpoint, maybe the House GOP had the right instincts in opposing a two-month extension. The two-month timeline approved by the Senate would ensure that this battle flares up again at an extremely opportune time for Obama: right around his State of the Union address and the introduction of his FY2013 budget.

After the reception Obama’s budget received last year, wouldn’t he rather have media focus on congressional squabbling over the payroll tax cut extension – or, as Democrats refer to it, “middle class tax cuts”? Plus, a brawl over payroll taxes would be a great backdrop for the class warfare, do-nothing Congress rhetoric in his State of the Union.

At this point, House Republicans may have to accept a more temporary extension than they’d like. They may be better off saving their energy for the battles down the road.



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