Why John Boehner can still win the tax-cut showdown

With the clock ticking down to a payroll tax hike for 160 million Americans on Jan. 1, Congress is headed into a standoff that leaves House Republicans increasingly isolated on Capitol Hill.

Speaker John Boehner stunned both Democrats and GOP colleagues when he announced on Sunday that a two-month deal that passed the Senate with a whopping 89-to-10 majority was going nowhere in the House.

“Americans are tired of Washington’s short-term fixes and gimmicks, which are creating uncertainty for job creators at a time when millions of Americans are out of work,” he said, at a press briefing on Monday.

“I think it’s time for the Senate Democrat leaders to follow the president’s example, put their vacations on hold and work in a bipartisan manner to finish the nation’s business.”

The GOP-controlled House is expected to vote to reject the Senate bill Monday evening, despite strong support from GOP senators. That leaves Congress with two alternatives: get House and Senate negotiators back to the table to resolve differences in a formal Senate-House conference – or allow the payroll tax break and other popular measures to expire.

On a conference call with Speaker Boehner on Saturday, GOP conservatives refused to back the Senate bill. “Members expressed their opinions that we had a good piece of legislation and what the Senate sent back wasn’t,” says Rep. Jim Jordan (R) of Ohio, who chairs the Republican Study Committee, the conservative wing of the House GOP caucus. “That message came through loud and clear.”

Meanwhile, several Senate Republicans are openly criticizing the House move. Sen. Richard Lugar (R) of Indiana told MSNBC in an interview Monday that passing the Senate bill is “best for the country, as well as for all the individuals who are affected.” GOP Sens. Scott Brown of Massachusetts, Olympia Snowe of Maine and Dean Heller of Nevada, all up for reelection in 2012, have also called on the House Republicans to back the Senate compromise.

Democrats and the White House on Monday called foul. Democrats say they had assumed that a deal with Senate Republican leader Mitch McConnell signaled that House Republicans would go along.

“I’ve been here long enough to say that it has never been the case that the Senate votes at 90 percent, with overwhelming majorities from both parties, without communication with their counterparts in the House,” said White House press secretary Jay Carney at a White House briefing with reporters on Monday.

The White House has not reached out to Boehner to help resolve the standoff, he added. “It is not our job to negotiate between him and Senate Republicans,” he said.

Anticipating Monday night’s House vote, Senate majority leader Harry Reid (D) of Nevada said earlier in the day that the Senate will not return to Washington to renew negotiations. The point of a two-month bill was to give negotiators time to settle these issues in a new year.

“My House colleagues should be clear on what their vote means today,” he said in a statement.

“If Republicans vote down the bipartisan compromise negotiated by Republican and Democratic leaders, and passed by 89 senators including 39 Republicans, their intransigence will mean that in 10 days, 160 million middle-class Americans will see a tax increase, over 2 million Americans will begin losing their unemployment benefits, and millions of senior citizens on Medicare could find it harder to receive treatment from physicians,” he added.

A version of the bill that the House passed on Friday extends the Social Security payroll tax cut for a year, saving the average taxpayer about $1,000.

The House bill also extends – and, over time, rolls back – expiring federal benefits for jobless workers and gives physicians treating Medicare patients a two-year reprieve from a mandated 27.4 percent cut in payments, also set to take effect on Jan. 1.

After failing to come to terms on how to pay for these expiring provisions, especially the $120 billion needed to make up for a shortfall in Social Security Trust Fund, the Senate opted to extend expiring provisions for two months and revisit the issue in February.

“But to come back now and create another showdown, especially after this overwhelming vote in the Senate, makes clear that it’s the fault of House Republicans that people will have less in their pockets after Jan. 1 and put the economy at risk,” says Norman Ornstein, resident fellow at the American Enterprise Institute.

“For Republicans, it’s a suicidal impulse,” he adds. “For Congress, it’s just another sign of deep dysfunction.”

But House Republicans say they have an advantage heading in to the endgame.

"Once we vote down the Senate bill and pass a resolution to go to conference, we're waiting on the Senate," says Michael Steel, a spokesman for Boehner. "The Democrats will cave. They always do."