Senate OKs payroll tax cut with Keystone XL provision

WASHINGTON — Senators racing for the exits after a year of bitter battles passed legislation today that would extend a Social Security payroll tax cut and jobless benefits for just two months, setting the stage for the next fight until February.

While a partial victory for President Barack Obama’s year-end jobs agenda, the measure awaiting House approval next week contains a provision demanded by Republicans to pressure the White House into approving construction of a Canada-to-Texas oil pipeline that promises thousands of jobs.

Democratic and GOP leaders optioned for the short-term extension after failing to agree on big enough spending cuts to pay for a full-year renewal of the payroll tax cut. The 2 percentage point tax cut affects 160 million taxpayers. The weekly jobless payments average about $300 for millions of people who have been out of work for six months or more.

The measure was approved by an 89-10 vote during a Saturday session.

Votes were scheduled later Saturday on a $1 trillion-plus catchall spending measure setting the day-to-day budgets of 10 Cabinet agencies. The House cleared the spending bill Friday.

In a statement, White House communications director Dan Pfeiffer indicated Obama would sign the two-month extension 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, but various media outlets reported the measure would require President Barack Obama to make a decision about the Keystone XL pipeline within 60 days.

The legislation would require the president to grant a permit, but allows Obama to opt not to do so if he determines that the pipeline is “not in the national interest.” One senior administration official said the president would almost certainly refuse to grant a permit. The official was not authorized to speak publicly.

The New York Times reported Saturday morning that the measure would speed the decision process for the construction of the Keystone XL pipeline, necessary to win over support from Republicans who opposed the tax breaks.

The Wall Street Journal, which also said the measure included a speedier decision on Keystone, said Democrats cautioned that the measure didn’t green light the 1,700 pipeline.

The developments came a few hours after the White House publicly backed away from Obama’s threat to veto any bill that linked the payroll tax cut extension with a Republican demand for a speedy decision on the 1,700-mile Keystone XL oil pipeline proposed from Canada to Texas Gulf Coast refineries.

Obama said on Dec. 7 that “any effort to try to tie Keystone to the payroll tax cut I will reject. So everybody should be on notice.”

Obama recently announced he was postponing a decision until after the 2012 elections on the much-studied proposal. Environmentalists oppose the project, but several unions support it, and the legislation puts the president in the uncomfortable position of having to choose between customary political allies.

Republican senators put the price of the two-month package at between $30 billion and $40 billion said the cost would be covered by raising fees on new mortgages backed by Fannie Mae and Freddie Mac.

The fees, drawn from a Treasury Department housing finance market reform plan, would add several thousand dollars to the 30-year cost of home loans guaranteed by mortgage giants Fannie Mae Freddie and Freddie Mac and the Federal Housing Administration.

A worker making a $100,000 salary would reap a tax cut of about $330 through the short-term payroll tax extension.

A version of the fee that circulated overnight would effectively raise the interest rate on a mortgage by one-tenth of one percentage point, but the still-undetermined final version — awaiting analysis from the Congressional Budget Office — was expected to be lower.

The measure also provides a 60-day reprieve from a scheduled 27 percent cut in the fees paid to doctors who treat Medicare patients.

Officials said that in private talks, the two sides had hoped to reach agreement on the full one-year extension of the payroll tax cut and unemployment benefits that Obama had made the centerpiece of the jobs program he submitted to Congress last fall.

Those efforts failed when the two sides could not agree on enough offsetting cuts to blunt the measure’s impact on the debt.

The failure tees up the issue again for early next year, but it won’t get any easier to agree on spending cuts. The

“We’ll be back discussing the same issues in a couple of months, but from our point of view, we think the keystone pipeline is a very important job-creating measure in the private sector that doesn’t cost the government a penny,” said Sen. Mitch McConnell of Kentucky, the Republican leader.

Neither House Speaker John Boehner, R-Ohio, nor his aides participated in the negotiations, although McConnell said he was optimistic about the measure’s chances for final approval. The payroll tax cut is unpopular in GOP ranks and another vote in two month could present a headache for GOP leaders.

The State Department, in an analysis released this summer, said the pipeline project would create up to 6,000 jobs during construction, while developer TransCanada put the total at 20,000 in direct employment.

The 1,700-mile pipeline would carry oil from western Canada to Texas Gulf Coast refineries, passing through Montana, South Dakota, Nebraska, Kansas and Oklahoma.

The spending bill would lock in cuts that conservative Republicans won from the White House and Democrats earlier in the year.

Republicans also won their fight to block new federal regulations for light bulb energy efficiency, coal dust in mines and clean water permits for construction of timber roads.

The White House turned back GOP attempts to block limits on greenhouse gases, mountaintop removal mining and hazardous emissions from utility plants, industrial boilers and cement kilns.

19 Comments

  1. SarahATP

    Keystone spilled 500 barrels of oil from a “broke valve” last weekend, spraying oil 60 feet into the air, from a pipeline less than a year old. A pipeline Keystone said they predicted “might” leak “about” 50 barrels every 7 years. Their response?? “…only included leaks from the pipe itself — not from the pump houses that dot the route. The valve that failed last Saturday was in a pump house” so it really wasn’t a pipeline leak?? Seriously?­?? LOL

    And we want to promote that attitude and way of doing business?? I think not. They want a pipeline that crosses the country to the Gulf Coast refineries, and then the products be loaded in tankers and sold abroad for larger profits. This is not about controllin­g the expense of US energy… it’s about the GOP being a solely owned subsidiary of Big Oil!!

    Besides… The U.S. Secretary of State has the final say nationally on the pipeline… not Obama.

    #1
  2. TheRipper

    Obama caves again. Is there any principle he will stand and fight for?

    #2
  3. BOB

    i bet these guys fixed this stuff as well.

    THE CONGRESS AND PRESIDENT LIKE SPENDING OUR TAX DOLLARS ON TURTLE BRIDGES, HELPING RUSSIAN PROSTITUTES WITH ALCOHOLISM, STUDYING SHRIMP ON A TREADMILL, PASSING A BUDGET EXTENSION AND LEAVING 200 BILLION OF DUPLICATE FUNDING BY DIFFERENT AGENCIES, GIVING 500 MILLION TO SOLYNDA 4 MILLION 700 THOUSAND A JOB, AND NOW THEY HAD TO SCRAMBLE TO SPEND MONEY LEFT OVER IN LAST YEARS BUDGET ON MORE SOLAR COMPANIES LIKE SOLYNDRA. SENDING CHECKS TO PRISONERS AND THE ICING IS SENDING IRS CHECKS TO ILLEGALS FOR TAX CREDITS THAT COST US OVER 4 BILLION LAST YEAR ALONE – KEEP IN MIND IT IS NOT IN THE LAW.

    WATCHING OVER MEDICARE WHO SPENDS A QUARTER A BILLION ON P*NIS PUMPS FR THE ELDERLY. MUCH WAISTE AND FRAUD IN MEDICARE – MEDICAID.

    http://news.heartland.org/newspaper-article/2011/12/06/quarter-billion-taxpayer-dollars-spent-penis-pumps

    WHAT I WOULD LIKE TO KNOW IS – WHERE IS YOUR OUTRAGE? WHERE ARE THE BILLS TO STOP THIS CRAP? WHERE IS MEDIA REPORTING THIS?
    I HAVE NOT HEARD OF OR SEEN ONE REPUBLICAN SUBMIT ANYTHING TO STOP THIS CRAP?

    THIS STUFF IS TERRIBLE – ARE YOU ALL ON THE TAKE?
    I EXPECT IT OF THE COMMIE OBAMIE DEMS.

    NOT ONE OF YOU DESERVE TO GO BACK TO YOUR POSITIONS FROM EITHER PARTY.

    YOU DO NOT HAVE OUR INTEREST AT HEART. JUST LIKE YOU COULD CARE LESS IF WE ARE KILLED BY ILLEGALS.

    ALL OF THIS IS PROOF THEY DO NOT CARE ABOUT THEIR CONSTITUENTS.

    #3
  4. SarahATP

    Give me a break! No Comments???? Censors!

    #4
  5. WriterDude

    Republicans: “Tax cuts for the wealthy don’t need to be paid for, and deficits don’t matter.” Apparently, tax cuts for the other 98% do need to be paid for, … with an OIL PIPELINE!!

    #5
  6. Govchance

    Sarah, just to ease your concerns, there is a liner under the gravel on those pump station sites that that keep the oil from penetrating into the soil. The sites are built with a slope that routes any potential oil leaks or spills into a containment ditch where it is recovered. Also, I don’t think you are being factual when you state that the oil will be shipped abroad after being refined. Just where did you get that bit of information?

    #6
  7. Matt

    This was a poorly written article, organized in a worse than sloppy way, with relevant details scattered in a haphazard and confusing way.

    Can’t the Chronicle afford a copy editor anymore?

    #7
  8. yonny

    http://www.bbc.co.uk/news/business-15889665 Scan down to the paragraph titled US Worries. The export intentions are very clear and further research will show they have shippers in place. Also you will see where China is investing in Canadian oil sands companies and acquired one already. There is a pipeline scheduled to go west for export to the Far East. Currently it is on hold which is why China is making a move. US exports are up and have been on a steady increase since 2008 while imports are on an opposite downward trend. The European and Latin American market is what is driving the increase in exports especially diesel. Further the export plans have been made clear to the Canadian government during their permit application in 2008. Here is a story from Canada.com that will give the potential expected. http://www.canada.com/business/Oilsands+exports+triple+2035+National+Energy+Board/5751381/story.html

    #8
  9. txloanguy

    Obana doesn’t want jobs and to reduce our oil dependence. He wants the oil to go to China so he can still push electric cars with massive subsidies. No matter what the public wants or needs. How many Volts have been sold? 7000? Even with a subsidy no body wants this turkey. And Dude, an oil pipeline that creates jobs and could lower gas prices is important. More important than the greenies demands for more regulation on pipelines when we have hundreds of thousands of miles of safe pipeline now. What, is there a snail darter somewhere in the US that could be affected?

    #9
  10. olddispatcher

    I have been involved in a lot of pipeline projects over these last many years. I have yet to see one that ever caused gas prices to go down.

    Not that it has not been tried, but there is just too many companies out there that can provide products to a market. If someone else tries to move in on their sales they don’t just roll over and play dead; they get busy and find a way to compete.

    I don’t care where the refined products go when they are ready to be shipped, but any source of supply that will keep Gulf Coast refineries humming sounds good to me. As soon as Nebraska works out a deal with TransCanada over a new route (which, according to the last time I checked TransCanadas web-site, they are still working on) I think they should open a spread and start turning dirt.

    The theory that building this line will cause gas prices to decrease is just a talking point. Distance has nothing to do with the price of gas since I can buy gas in Oklahoma City, where the nearest refinery is 60 miles away, cheaper than I can buy it in Baytown. It all depends on what the market is doing at the time.

    #10
  11. Tracy Guilbeau

    The XL pipeline will only create about 500 permanent jobs and a few thousand short term (2 year)construction jobs…. sure it’s better than nothing but ecologically this is a bad move. this is the dirtiest of the dirty fossil fuels we could develop, and destroying million of acres of some of the most beautiful parts of Canada to get it. I hope that b_st_rd Obama rejects it…. but he wont, he makes all the proper moves the conservatives, republicans, bankers and millionaires like to see… he just hims and haws and wines and SWEARS HE WONT!!! but then he always does.

    #11
  12. drb

    Pump stations are the most likely place a spill will occur. If I remember correctly over 2 gallons is reportable. Pump stations are designed to contain any such spills to minimize risks. Spills are costly to business and most business make every effort to manage it. You get in trouble when you have companies operated by investment companys & bean counters. (If you haven’t add an incident in x time then reduce inspection & maintenance by Y even though the reason you didn’t have the incident was because of your maintenance & inspections)

    #12
  13. YeahBuddy

    They kicked the can down the road (again). In 2 months, they will kick it down the road, again. None of our current crop in Washington will solve ANY problems.

    #13
  14. Stephenie

    Ahhh, that’s ok. Obama says he has done everything he can and has helped keep Americans working . America is doing so well & the economy is just great. By the time the next round comes around again Americans won’t need the extra money(eyeroll)

    #14
  15. luckyone

    This will continue to blow a hole in Social Security which is already broke. It’s a bad deal puts us further in debt.
    Our government is corrupt, and destroying the country. The only jobs they care about are there own. You can probably count on one hand the members that have the best interest of the country at heart.

    #15
  16. Wayne Togo

    GRRRRR,

    The federal loan guarantees for the Keystone Tar fiasco are pure payola.

    The tar sands are natural asphalt, like we pave streets with.

    The resulting ‘oil’ is extremely expensive and thick as molasses.

    There are plenty of pipelines already. A few were scheduled for flow direction reversal.

    SCCRRREEEWWWWED and SCROOOGGED AGAIN !!!

    MERRY CHRISTMAS from the LOOTERS OF WashDC AGAIN & AGAIN.

    GRRRR

    #16
  17. Wayne Togo

    GRRRR

    Does this Keystone (Cops) project SOUND LIKE USA jobs to you, or a 3rd rate rip-off?

    Siemens was awarded a $200 million contract from TransCanada Pipelines Ltd., to supply the Keystone Pipeline project with electrical equipment, electrical power supply and pumping equipment. The 3,456 kilometre pipeline will transport crude oil from the oil sands in Northern Alberta to U.S. markets in the Midwest and to the area of Cushing, Oklahoma. Siemens will deliver 37 pumping stations, including pump skids, a series of electrical houses and 19 substations, and supply pumping electrics and portions of the electrical distribution system along 2,867 kilometres of this crude oil pipeline.

    http://www.siemens.ca/web/portal/en/corporatebrochure/Documents/CorpBrochureFINAL-EN.pdf

    GRRR

    #17
  18. Wayne Togo

    The Alberta Tar Sand (Keystone Pipeline) project has always been a stealth nuclear power plant project. One player, Energy Alberta (Bruce Power) has shelved their nuclear power generation project. Others, such as SaskPower International, TCE, Cameco, and/or Areva remain ‘in the game’.

    Bruce Power officially pulls the plug on nuclear power in Alberta

    By Markham Hislop | December 13, 2011
    BEACON NEWS GROUP CANADA – Calgary Beacon 2011

    Nuclear power has been taken off the table after four years of consideration by Bruce Power, an Ontario-based company that operates provides one-quarter of that province’s electricity.

    Bruce Power has announced it will no longer advance the option for a new nuclear plant in Alberta that has been under consideration by the company since 2007.

    #18
  19. ntangle

    WTG says – The Alberta Tar Sand (Keystone Pipeline) project has always been a stealth nuclear power plant project.
    ————-
    Huh? As if a new mega billion $ 36″ pipeline from the hemisphere’s fastest growing oil producer to its largest market would exist for the purpose of justifying a nuclear plant?

    And what’s wrong with Siemens? They’re one of the best qualified to do this correctly. They have lots of production facilities in the US and even in Houston. As well as lots of engineers here too.

    #19