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House GOP bill would renew payroll tax cut — and push along oil pipeline

WASHINGTON — House Republicans unveiled a bill Friday renewing the Social Security payroll tax cut and extending but trimming unemployment benefits but barreled toward a showdown with President Barack Obama by including language jump-starting work on a controversial oil pipeline.

Next week's House vote looms as the opening scuffle in a year-end battle that will let each party spotlight its economic priorities ahead of November's elections.

The two parties generally agree on the bill's pillars: preventing the Jan. 1 expiration of payroll tax cuts and of extra coverage for the long-term unemployed, and avoiding a mandated cut in payments the government sends doctors for treating Medicare patients.

But the GOP tax cut and jobless benefits are less generous than Democrats want. And Republicans ignore the White House's preference to finance the bill by boosting taxes on millionaires, instead paying their bill's price tag — more than $180 billion — by extracting money from federal workers, boosting federal fees and requiring some seniors to pay more for Medicare.

The legislation revealed new details, including letting states administer drug tests to some unemployment benefit applicants; barring welfare recipients from using benefits at strip clubs, liquor stores and casinos; and cracking down on illegal immigrants collecting federal checks for the children's tax credit by requiring them and others to first produce Social Security numbers.

The GOP plan also staves off a threatened Medicare cut that would slash fees paid to doctors by 27 percent.

Without action, the payroll tax paid by 160 million workers would return to its normal 6.2 percent on Jan. 1, up from 4.2 percent this year. That reduction saved $1,000 this year for a family earning $50,000.

The GOP bill would keep the payroll tax at 4.2 percent through 2012. Obama proposed just a 3.1 percent levy next year and wanted to give similar tax breaks to employers.

The Republican bill would also gradually reduce the maximum 99 weeks of unemployment coverage to 59 weeks by mid 2012, coverage many Democrats consider too short. Without a renewal, about 2 million jobless people would lose benefits by February.

The marquee dispute, though, appears to be over GOP language that would give the administration two months to issue a permit allowing work on the proposed Keystone XL pipeline, to be built from Canada to Texas.

Obama had delayed a decision on the project until after the November elections and said this week he would reject the bill if it included pipeline language.

House GOP bill would renew payroll tax cut — and push along oil pipeline 12/09/11 [Last modified: Friday, December 9, 2011 10:56pm]
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