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Journal Editpage Nails It!

Words I never thought I'd write: If you want to know what happened yesterday in the House of Representatives, skip the Washington Post's Page One news story and read the Wall Street Journal's lead editorial instead. It's more accurate.

The Post story, by Rosalind S. Helderman and Paul Kane, portrays the impasse over extending the payroll-tax cut as a classic partisan conflict. Someone pressed "Alt 5" on a computer keyboard and out spat this hackneyed boilerplate:

"At its heart, the fight over the tax cut is only the latest incarnation of the same ideological clash that has afflicted Congress for the past year, over what the government should fund and how it should be paid for.
"Once again, Democrats and Republicans foundered over whether to fund an initiative by cutting entitlements and other spending or by raising taxes on the wealthy."

Actually, no. The Democrats had already retreated, in the Senate compromise that the Republican House ostentatiously rejected, from their millionaire surtax. They'd also agreed to force President Obama to make a quick decision on the Keystone XL pipeline--something Obama just days earlier had threatened (emptily, it turned out) would force him to veto the bill. The real story here is that the Democrats couldn't find anyone to whom they might reliably surrender on any and all secondary points just so they could get some tiny sliver of the president's stimulus bill passed. By refusing to take "uncle!" for an answer, the House Republicans turned victory into defeat.

To learn that, you have to turn to the Journal editorial. (The New York Times's Page One story by Jennifer Steinhauer also conveys this; the Journal's news story, by the usually-excellent Janet Hook and Laura Meckler, does a little bit, too, but not nearly as well as the Times story or the Journal editorial.) Only the Journal edit page portrays this as a full-blown fiasco born of the GOP's self-destructive intransigence. Needless to say, they aren't happy about it:

"GOP Senate leader Mitch McConnell famously said a year ago that his main task in the 112th Congress was to make sure that President Obama would not be re-elected. Given how he and House Speaker John Boehner have handled the payroll tax debate, we wonder if they might end up re-electing the President before the 2012 campaign even begins in earnest.
"The GOP leaders have somehow managed the remarkable feat of being blamed for opposing a one-year extension of a tax holiday that they are surely going to pass. This is no easy double play.
"Republicans have also achieved the small miracle of letting Mr. Obama position himself as an election-year tax cutter, although he's spent most of his Presidency promoting tax increases and he would hit the economy with one of the largest tax increases ever in 2013. This should be impossible."

Well ... yeah.

The Journal editorial also opines that as economic policy the payroll tax-cut extension is irrelevant: "No employer is going to hire a worker based on such a small and temporary [one-year] decrease in employment costs, as this year's tax holiday has demonstrated." This view is at odds with that of most economists, but what's truly informative here is that the Journal is admitting (as Senate Whip John Kyl has, but House Republicans cannot) that they don't really think a tax cut, or tax holiday, or whatever you want to call it, should be wasted on any group that does not include the rich. This appears also to be the view of Grover Norquist, high priest of tax-cutting, who earlier reassured the Republicans that he would not score this vote as a tax increase (though he also came out in favor of an earlier Senate Republican bill that would have extended the payroll tax cut). 

Take a look at Norquist's Americans For Tax Reform Web site today. Ain't nothing there about the payroll tax vote. This from an organization obsessively opposed to anything that looks, sounds, or smells like a tax increase. Pigs fly, hell freezes over.

Update, 11 a.m.: Post blogger Felicia Sonmez does a much better job than her dead-tree colleagues in explaining how this fight evolved and how the Republicans blew it. My only quibble would be to question whether this really is, as she writes, the result of Republicans putting policy first while Democrats put politics first. The trouble with this interpretation is that it dismisses the notion that any stimulus is needed at all, or, if it is needed, that extending the payroll-tax cut would have any effect. If no stimulus is needed, I guess that would be because the recovery is picking up. That's possible, given the latest housing data, but it's too early to say for sure. (And anyway--yes, this is a political consideration--if the payroll tax cut is unnecessary because the economy is finally bouncing back Republicans can't say so without giving away their No. 1 issue for 2012.) If the payroll-tax cut would have no effect, then Goldman, Sachs and Mark Zandi of Moody's and the Congressional Budget Office are all wrong. They have been wrong before, God knows, and Post blogger Ezra Klein has pointed out that many economists feel the effects would be negligible compared to the effects of a more ambitious spending-based stimulus. But we aren't going to get a more ambitious spending-based stimulus, so the real question is whether a payroll-tax cut is better than nothing. It is.

Also, as Sam Stein reported in the Huffington Post, those policy-obsessed House Republicans were perfectly happy three years ago to implement a two-month payroll tax holiday. What changed their mind? Surely it wasn't policy.

Apart from that, though, Sonmez has the story that her newspaper is too polite to tell its readers.