The signs look hopeful for a short-term accord in Congress on extending the payroll tax cut and unemployment benefits.

But right after Election Day, a lame-duck Congress will face a horrific fiscal train wreck: sharp tax increases, combined with automatic spending cuts — and scanty reserves of political goodwill to help clinch a deal to avert that outcome.

A House-Senate conference committee met Thursday to try to push ahead with a full-year payroll tax cut. The committee will keep working next week as Congress heads to a Feb. 29 deadline.

Also as part of that deal, there’s bipartisan accord on the committee to not allow Medicare spending cuts enacted in 1997 to take effect. The payroll tax cut package will include another in a long series of postponements of the cut in Medicare payments to doctors.

President Obama railed against dysfunction on Capitol Hill during his State of the Union address, blaming gridlock in Washington for the economy’s sluggish performance in the past year.

The president demanded a series of reforms intended to address the poor function of Congress, which played out in a series of battles over taxes and spending over the past year, and drove public opinion of lawmakers to an all-time low.

“But no matter what party they belong to, I bet most Americans are thinking the same thing right now: Nothing will get done this year, or next year, or maybe even the year after that, because Washington is broken,” Obama said. “Can you blame them for feeling a little cynical?”

Washington (CNN) — President Barack Obama asked Congress Friday for more power to streamline and reorganize the federal government, a move designed to claim the political middle ground in an election likely to be dominated by questions about Washington’s role in the economy.

The president asked legislators to grant him the authority to merge agencies that perform similar functions. If that power is granted, Congress would be required to hold an up-or-down vote on the president’s streamlining plan within 90 days of its submission.

The White House announced today that a planned request for Congress to approve an increase in the nation’s debt ceiling would be delayed by several days in order to prevent Congressional leaders from being forced to call members back early from their holiday recess.

According to Deputy White House Press Secretary Josh Earnest, the Budget Control Act passed earlier this year allows the President to “submit a written certification to Congress when the debt subject to limit is within $100 billion of the debt limit” and request an increase in the nation’s borrowing limit. After that certification is submitted, Congress has 15 days to vote on a resolution of disapproval – if they so choose.

Washington (CNN) — President Barack Obama on Saturday reluctantly signed a defense authorization bill, saying he was concerned about some in Congress who want to restrict options used by counterterrorism officials.

“I have signed this bill despite having serious reservations with certain provisions that regulate the detention, interrogation, and prosecution of suspected terrorists,” he said of the $662 billion legislation.

The White House had lifted a veto threat against the bill after legislators made changes in language involving detainees.

WASHINGTON — Shortly after Congress approved a two-month renewal of payroll tax cuts for 160 million workers and unemployment benefits for millions, President Barack Obama on Friday signed a bill formalizing the extension and won a convincing victory for his jobs agenda.

 The voices of Americans “made a difference” in persuading Congress to
act, Obama told reporters in brief remarks. “This is some good news just
in the nick of time for the holidays.”

WASHINGTON — Congressional negotiators reached agreement Thursday on a compromise spending bill to avert a weekend federal shutdown. They also worked toward a deal renewing the payroll tax cut and unemployment benefits for another year but prepared a shorter version as a fallback.

Senate Majority Leader Harry Reid, D-Nev., told reporters he was still optimistic that bipartisan talks on yearlong extensions of the Social Security payroll tax cut and unemployment coverage would succeed. But as a “Plan B,” he said, they were working on a two-month extension as well, which would also prevent cuts in Medicare reimbursements for doctors during that period.

“We’re still working on the long-term” bill, Reid told reporters as he exited the Capitol after a day of talks over both the payroll tax and spending measures. As for the two-month version, he said, “We’ll only do that if what we’re working on doesn’t work out.”

Full Story at NBC Politics – Deal made to avoid government shutdown

Deal made to avoid government shutdown

Washington (CNN) — Congress will agree to extend the payroll tax cut before it expires at the end of the year, two leading conservative Senate Republicans said Sunday.

The comments demonstrated the GOP shift on a proposal originally opposed by Republican leaders, even as each side continues trying to persuade the other of the best legislative approach to take.

Senate Minority Leader Mitch McConnell told “Fox News Sunday” that bipartisan support in both chambers would coalesce around a House Republican plan that links extending both the lower payroll tax rates and unemployment benefits to easing the path for approval of the Keystone XL oil pipeline from Canada.

Washington (CNN) — Democrats on Monday will propose a compromise plan to extend the payroll tax cut that includes a “serious” way to pay the more than $200 billion price tag, the chairman of the Senate Budget Committee says.

Senate Majority Leader Harry Reid, D-Nevada, will introduce the compromise proposal Monday after the chamber last week voted down competing Democratic and Republican plans, Sen. Kent Conrad told “Fox News Sunday.”

The North Dakota Democrat refused to divulge details, saying it was up to Reid to do so, but added it would be “paid for in a way that’s credible and serious.”

Congress and the White House are headed for a showdown over a massive, $662 billion defense bill that would require the military to hold suspected terrorists linked to al-Qaida or its affiliates, even those captured on U.S. soil, and detain some indefinitely without trial.

The Senate voted 93-7 Thursday night for the legislation, which must be reconciled with a House-passed version in the closing days of the session. The White House has threatened a veto of the Senate bill over the policies on handling terror suspects and has criticized similar provisions in the House bill.

Overall, the bill would authorize money for military personnel, weapons systems, national security programs in the Energy Department, and the wars in Iraq and Afghanistan in the fiscal
year that began Oct. 1. Reflecting a period of austerity and a winding
down of decade-old conflicts, the bill is $27 billion less than
President Barack Obama requested and $43 billion less than Congress gave
the Pentagon this year.