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Amid tax posturing, Senate GOP blocks bill to encourage small business hiring

By Rosalind S. Helderman,July 12, 2012

Senate Majority Leader Sen. Harry Reid (D-Nev.) speaks as Sen. Charles… (Alex Wong/GETTY IMAGES )

Republicans in the U.S. Senate Thursday blocked a bill sponsored by Democrats to provide additional tax breaks to small businesses that hire new workers, amid a procedural debate over how and when the Senate should vote on a broader proposal to extend the Bush-era tax cuts that expire at the end of the year.

GOP senators objected to a move by Senate Majority Leader Harry M. Reid (D-Nev.) to prevent votes on amendments to the measure. Reid acted as the two parties could not agree exactly how to go about using the bill to vote on whether to extend the Bush tax cuts.

Republicans favor extending the tax cuts, first enacted in 2001, for all income levels. President Obama has proposed extending them only for income less than $250,000, and using the higher tax revenue collected from higher incomes to help close the deficit.

The small business tax cut bill died on 53 to 44 vote--it needed 60 votes to move ahead--amid bickering between the parties over which was more anxious to hold an immediate vote on the Bush tax cut issue.

Democrats said the vote was a sign the GOP, which identifies itself as the party of tax cuts, was willing to block those that might create jobs and boost President Obama’s reelection effort.

“Republicans are blocking this bill for no other reason other than that they think passing it might help the president and help the economy,” said Sen. Charles E. Schumer (D-N.Y.).

Republicans countered the vote was a political exercise, and Democrats would not have blocked debate on amendments if they really wanted to have a full discussion about using tax cuts to help the economy.

“Here’s the Democrat-controlled Senate, blocking votes, blocking debate, and hosting private meetings with the president’s political advisors on political strategy instead of working on serious, bipartisan solutions,” said Senate Minority Leader Mitch McConnell (R-Ky.).

The legislative maneuvering came as both parties are working to sharpen their message on taxes heading into the November election.

Both the House and Senate plan votes before the August recess on whether to extend the Bush tax cuts. And both parties know that the issue is unlike other pre-election legislative fights that are designed largely as fodder for campaign ads. The end-of-year deadline means Congress must make a decision at some point about whether to extend the tax cuts.

Votes taken on the issue before the election will not resolve it, but could provide each party leverage as they enter post-election negotiations about how to deal with the issue, along with how to avert the deep budget cuts also scheduled to go into effect in January.

“The fact is that this December 31st deadline is pushing us to some decisions that we have put off for way too long,” said Sen. Dick Durbin (D-Ill.)