Republicans Cave: House, Senate Pass Two-Month Extension

Payroll Tax Cut Bill: House, Senate Pass Two-Month Extension:

The two-month package preserves a $1,500 payroll tax cut for the middle class and extends unemployment benefits that were set to expire at the end of the year, preventing an abrupt cutoff for nearly 2 million long-term jobless in January alone. The bill also extends the "doc fix," a stopgap that prevents Medicare reimbursement rates for doctors from being automatically slashed. 

But the bill also marks the beginning of the end for a maximum limit of 99 weeks of unemployment insurance. Although the deal reauthorizes federal unemployment programs, it does not make a change needed to prevent the loss of 20 weeks of benefits in most states over the course of 2012. The reduction in benefits represents Democrats' quiet embrace of part of the GOP's proposed reforms to the unemployment insurance system.

This is a big win for the Obama administration. President Obama has seen his approval ratings rebound in recent weeks. Several factors contribute to this bump but main among them is the American public's increasing disdain for Congress. In a recent poll it was found that approval rating for Congress had reached an all-time low of 11%. To put that into perspective, the following things are more popular than Congress: the IRS, Oil Spills, Lawyers, and Communism. Juxtaposed against an institution this unpopular, the President doesn't seem so bad. Congress and House Republicans in particular are losing their leverage against the President. All year Republicans were adamant that tax hikes on the rich were off the table. Yet when it came time to extend a largely middle and working-class tax cut (payroll tax) they refused, merely for the sake of opposing the President. Americans are getting tired of a do-nothing Congress that mainly protects the interests of the rich. This gives President Obama plenty of fuel for his reelection campaign. Though he hasn't deliver on many of his promises, at the very least he can run against Congress, similar to what Harry Truman did in 1948. 


Combined with the fact that GOP has a lackluster field of candidates vying for the Presidential nomination, Obama has plenty to be optimistic about. His biggest threat would be Mitt Romney, and honestly his candidacy has more holes in it than Augusta National. If the economy can continue to rebound, his 2nd term would be all but assured.