Compromise on Tax Cuts Near?

Ok, maybe not before the elections - at least that's what most aides on both sides of the aisle will tell you right now.  But - it does seem that the makings of a compromise are coming together. Whether or not this effort will go anywhere remains to be seen, even in a lame duck session.

Moderate Republican Sen. Susan Collins told reporters Tuesday, "I think that it would be a mistake to raise taxes at a time when our economy is so weak and unemployment is so high. So, what i would like to see is an extension of all the tax cuts." The Maine senator added, "My hope is that we could agree on a 2-year extension of the current law."

Collins said she knew of no actual effort at a short term compromise, but the idea of a temporary extension of the top rates is definitely something that has growing support.  Even Senate GOP Leader Mitch McConnell, R-Ky., said recently that he could support such a thing, if that were the only option.

Sens. Ben Nelson, D-Neb, and Kent Conrad, D-ND, both moderates, are saying the same thing, essentially, extend the relief for all Americans while the economy is in bad shape.

Maine's senior senator, Olympia Snowe, echoed the "extend all the cuts" position, saying, "I think it's absolutely crucial, given the tenuous economic times that we're in, and in particular, small businesses and businesses in general...The fact of the matter is, small businesses are affected by the top two tax rates."

BUT, the senator added, "I'm not drawing lines in the sand with a time frame."

Snowe, who often negotiates compromises with Democrats, said she is disappointed that the President has "drawn that line on the top two tax rates, because I think it's not really recognizing what's happening on Main Street...His eyes need to be opened to this...serious and profound problem." The senator said emphatically, though, that no taxes should be raised right now.

President Obama has made clear that he support extending only tax cuts for the middle class, preferring that the top two tax rates revert to pre-Bush era levels.

If Senate Majority Leader Harry Reid, D-Nev., who also supports the middle-class-only approach, were to bring a bill that does just that, as his aides have indicated is the plan for now, it is unclear if the 60-vote filibuster hurdle could be surmounted. Neither Snowe nor Collins would say how they would vote on such a move, sidestepping the question when asked.

Reid can count on the support of Sen. Joe Lieberman, I-CT, who said Monday he would support cloture, the procedure that shuts off debate. And Sen. Claire McCaskill, D-Mo, certainly indicated today that she would help out, saying she's inclined to support only an extension of the middle class tax cuts, though she is also open to negotiations.