GOP Leader Claims Dem Support for Payroll Tax Cut, Pipeline Package

President Obama's veto threat for a payroll tax cut that includes action on the Keystone oil pipeline is "posturing," the top Senate Republican said Sunday, asserting that enough Democrats support building the pipeline to enable a vote on a GOP-styled compromise.

Senate Minority Leader Mitch McConnell told "Fox News Sunday" that his Democratic counterpart, Majority Leader Harry Reid, and the president may want to check with their base before threatening to hold up a House version that calls for tying an extension of the tax holiday to a "shovel-ready" project like the transnational pipeline.

"I'm on the same side as Jimmy Hoffa and the AFL- CIO on this. The Teamsters and the AFL-CIO want the Keystone Pipeline right now," said McConnell, R-Ky. "Look, the president has been talking about creating jobs. This is ready to go immediately. All it requires is his sign off.

"Obviously we'll reach an agreement. The president is posturing here," he added.

But Sen. Dick Durbin, the No. 2 Democrat in the Senate, said Republicans' refusal to raise taxes on the highest-income Americans has brought the country to the brink of crisis. He called it a "clear and defining moment" over who is looking out for the middle class.

Republicans have "consistently said they will refuse to increase the taxes of the wealthiest people of America one penny if that's what it takes to make sure working families get a payroll tax cut," Durbin said, calling the refusal to charge a surtax on millionaires a threat to jobs held by teachers, firefighters and policemen.

"What the Republicans offer us is the same formula that brought us into this recession. Cut taxes on the wealthy. And cut that government oversight to make sure we have clean drinking water, air we can breathe, and make sure that wall street doesn't run Washington, instead of the other way around," he said.

The House legislation would extend the current payroll tax cut from 6.2 percent to 4.2  percent for another year. It would also extend unemployment benefits for 59 weeks as well as shorten the timeframe for approval of a pipeline from Alberta, Canada, to Texas.

It also eliminates a regulation proposed by the Environmental Protection Agency that would severely limit output on boilers. Twelve Democrats in the Senate have cosponsored legislation to rescind the boiler rules that opponents say could cost 800,000 jobs.

Reid said Friday that sending the House bill over to the Senate would be a waste of time because it will not pass, but McConnell argued otherwise.

"It has bipartisan support. But we also need to have something in there that prevents the loss of jobs and something that will create the jobs," McConnell said. "And that's why we inserted Boiler MACT, supported on a bipartisan basis and the Keystone pipeline supported on a bipartisan basis. One would save jobs, one would create jobs right now."

Sen. Lindsey Graham, R-S.C., who appeared with Durbin on NBC's "Meet the Press," said "taxing one group to pay for a tax cut for another is not going to sell." But he also contradicted McConnell, suggesting that the pipeline proposal "is probably not going to sell" either.

Graham said since both sides acknowledge they want to extend the payroll tax cut, the "more important" decision is how to "come up with sustainable policy that will turn America around."

McConnell suggested that policy begins with a balanced package that "doesn't do anything for millionaires" but also doesn't tax job providers.

"We are not here to defend high income people. And in this bipartisan package that we're just discussing, we make sure that millionaires don't get unemployment and don't get food stamps. We freeze the pay for members of Congress and for all federal workers, continue to freeze the pay that has been frozen. This is a very balanced package," he said.