House Vote Coming on Payroll Tax Cut Extension

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House Vote Coming on Payroll Tax Cut Extension

White House economic adviser Gene Sperling weighs in

NEIL CAVUTO, HOST OF “YOUR WORLD”: House Republicans are expected to vote down a two- month extension of the payroll tax cut just hours from now. House Speaker John Boehner saying it would only create more uncertainty for job creators. The White House today blaming this latest vote on a Tea Party revolt.

Reaction now from director for the National Economic Council, Gene Sperling.

Mr. Sperling, good to have you.

GENE SPERLING, DIRECTOR, WHITE HOUSE NATIONAL ECONOMIC COUNCIL: Thank you.

CAVUTO: Where does this stand right now?

SPERLING: Well, I think all of us and I think most of America certainly thought that when 90 percent of the Senate came together to support a compromise to meet the president’s basic principle that we’re going to extend the payroll tax and unemployment insurance, so that 160 million Americans don’t see their taxes go up at the beginning of January, that we had a deal and that that was something the speaker of the House supported.

So it’s obviously quite a shock, a surprise to now learn that, after having 90 percent of the Senate, you know, Republicans and Democrats, support this deal, that this might now be blown up, and that once again we could be at risk of seeing taxes go up for 160 million Americans. And our hope is...

CAVUTO: But wasn’t it blown up, Gene, -- wasn’t it blown up, Gene, because it was really just sort of kicking the ball another couple of months; it really wasn’t of any permanent or lasting value, and we would be revisiting the same thing in short order? So it was all actually a joke?

SPERLING: So, Neil, there is no question this president obviously proposed the American Jobs Act more than 100 days ago.

We not only wanted to extend the payroll tax cut. We wanted to expand it for workers. And we wanted to cut payroll taxes in half for six million small businesses who employ 56 million Americans. So, yes, we would like more. We would like a full year. We would like a lot more for jobs in this.

However, this did meet a basic principle that we were not going to let whatever our division was here keep us from ensuring the taxes remained cut, didn’t go up 160 million Americans.

(CROSSTALK)

CAVUTO: So, even if it could keep it going a couple of months, keep it going a couple -- but where do we go now? Does the president then delay his vacation more? What are you waiting for? What now?

SPERLING: Well, you know, Neil, the goal here was -- and I think both Leader McConnell and Majority Leader Reid felt this was buying us time to finish an agreement, extend for a year. We should just get this done.

CAVUTO: Right.

SPERLING: We would like to see the House vote for it. And we will have time to work it out.

In the meantime, the president is here working on this each and every day. And that’s our number-one focus here at the White House. That’s the president’s number-one focus.

CAVUTO: So, does that mean, Gene, assuming there is no deal -- because the Senate has left town, essentially, right? It’s up to the House. I guess they could come up with other measures, maybe revote on the Senate measure. There are a couple of options at hand here.

But assuming that that doesn’t get done, does everyone just leave for vacation with this not done, including the president, including you?

SPERLING: You know, the president has been pretty clear. We have got to pass the payroll tax cut, so we don’t see taxes going up for 160 million workers.

You and I both know that the economy next year is still projected to grow only about 2.2 percent. And that’s assuming the payroll tax cut is extended. So if we were to leave town and leave in doubt whether or not taxes were going up, whether the payroll tax cut was going to essentially be repealed for next year, that would be a very serious setback to the economy.

The president has been very clear. Our number-one focus right now, though, Neil is this vote tonight. We think -- there’s been some surprises. Let’s have a positive surprise. Let’s have the House decide...

CAVUTO: So, tonight is where they are looking at an extension maybe of a little bit more lasting value that would satisfy all sides. How likely is that, though?

SPERLING: What we would like to do is see the House pass the two- month extension, so we all know that no one’s payroll taxes are going to be raised.

Two months would assure that two-and-a-half million Americans still pounding the pavement every day looking for a job don’t see their unemployment benefits get cut off. And this president has been clear. Let’s make sure we have the certainty that the tax cut is going to be extended. And we are willing to work as hard as anybody is willing to work with us to get the full-year extension as quickly as possible.

But let’s first pass this bipartisan compromise that -- I mean, Neil, how many things get 89 votes in the United States Senate? I mean, mom, Apple pie, chocolate ice cream maybe. When 89 senators agree on something, I think that’s an overwhelming bipartisan agreement and compromise.

And the best thing we can do for confidence is show that we are capable of moving the ball forward on something that would affect every working family in the United States.

CAVUTO: We will watch closely.

Gene Sperling, good seeing you again.

SPERLING: Thank you. Thanks for having us.

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