Poor Prospects For The Payroll Tax

by Stuart Shapiro

When Congress passed a two month extension to the payroll tax holiday, I assumed that the same incentives would hold in two months and a longer extension was inevitable.  Steve Benen looks at the appointment of three hardline Senators to the conference committee as a sign that the opposite is true.

Instead of last week, when House Republicans became the clear villains, when the conference committee struggles to come up with a bipartisan solution, the party will find it easier to spread the blame around.

“It’s not our fault,” GOP leaders would say. “We tried to work with Democrats on a deal, but one didn’t come together. Oh well.”

For Republicans, it’s the best of all possible worlds: middle-class taxes would go up, the economy would take a hit, public disgust for Washington would be renewed, and the media would feel obligated to say “both sides” failed to reach an agreement.

Ugh.

By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.