Pelosi Goes to the Mattresses

The Democratic Caucus at work.

Speaker Pelosi has said she won't bring the tax cut deal to the floor as it currently stands.  OK, what might they change?

My guess is that they will look most carefully at Estate Taxes and payroll taxes.  They might try and massage some more money out of the Estate tax, but my guess is probably not.  Instead, I think they will try and kill the reduction in payroll taxes and look to redistribute tax benefits in other areas.

There is legitimate fear among progressives (and insufficient fear by the President) that when the payroll tax cut is set to expire a  year from now, it will be extended, and the subsequent damage to Social Security will actually put it in the dire straits that hair-on-fire critics of the program have been screaming about all along.

If they can find a way to cut taxes for working people that doesn't touch Social Security, then that will be a net-plus to the compromise, and one that Republicans will have a hard time being coherent in opposing.  That won't stop them from opposing it, because coherency is not their strong suit.

In a perfect world, they alter the payroll tax cut in some way (how about legally tying any extension to ending the cap on payroll taxes that exists at $103K), the bill passes, the economy gets a little squirt of Red Bull and the circular firing squad ends.

And they lived happily ever after...