Boehner: "Welcome to Divided Government"

House Speaker John Boehner (R-Ohio) began his weekly press conference saying that the House bill passed yesterday to extend payroll tax cuts was a bipartisan effort.

“Did this bill have everything the Republicans wanted? Certainly not. Democrats didn’t get everything they wanted either. But that’s how divided government works. At the same time everything in the House passed bill has bipartisan support. Payroll tax cuts and unemployment benefits… bipartisan.” Boehner said.

He went on to say that the bill is fully paid for and 90 percent of the offsets are based on ideas from President Obama. There is a provision in the bill that eliminates tax payer funded benefits  for millionaires and billionaires.

The Speaker added that there are provisions in the current legislation that will jumpstart Keystone Pipeline projects which will create thousands of jobs in this struggling economy.

 When asked about a recent Pew Research Poll that said nearly 70 percent of Americans feel that members of Congress do not deserve to be reelected next year, Boehner said “welcome to divided government.”

“The American people provided a Republican House, a Democratic Senate and a Democrat in the White House. As a result we have to work overtime to find common ground to do what the American people sent us here to do. It’s not pretty and not easy,” Boehner replied.

At an earlier press briefing House Minority Leader Nancy Pelosi said the “House Republican bill was doomed from the start.” She added that she would not go home for the holidays without extending  payroll tax cuts.

Hoyer Blames GOP Leadership For 'Do Nothing' Congress

By Adrianna McGinley

House Minority Whip Steny Hoyer (D-Md.) told reporters at a press briefing Tuesday he remains hopeful that Republicans and Democrats will work in the last weeks of the year to pass economic recovery legislation, but the GOP must be willing to cooperate.

“There is no doubt in my mind that if Mr. Boehner, Ms. Pelosi, Mr. Cantor and I sat down and we could all agree that we’ll both come up with a majority, under the following circumstances…we could do it,” Hoyer said. “The issue is whether or not we’re going to do it in a bipartisan way or pursue a partisan message.”

Hoyer blasted Republicans for moving less than half the amount of legislation the Democratically-controlled Congress moved in 2007 under a Republican administration and attributed the lack of action to a complete unwillingness of the GOP to move away from political messages.

“They voted three times to end Medicare, we’re not going to do that, they continue to vote for it. [They] voted ten times on regulatory bills that do not create jobs…They voted 23 times against initiatives to create jobs…They voted 14 times to repeal patient protections and put insurance companies back in control of healthcare, they know that’s not going to pass the Senate, they know the president is not going to sign it. These are all political message bills for their base, a relatively narrow base.”

“We’ve moved a lot of legislation through the House which the speaker must have known, we knew, had no chance in the Senate, but it was their political message,” Hoyer added. “They’ve been pursuing their political message, not policy.”

When asked if he thinks House Speaker John Boehner (R-Ohio) is responsible, he said, “Yes, I think the Speaker bears responsibility. He is, after all, the leader.”

With the current continuing resolution expiring in two weeks, Hoyer said “we are going to urge staying here until we get [the sustainable growth rate, unemployment insurance, and payroll taxes] done.”

On the legislation proposing an extension and increase of the payroll tax, Hoyer said Republicans are alienating their constituents, citing that roughly 75 percent of Americans support raising taxes on millionaires to aid the middle class.

“I frankly think the millionaires’ tax is putting a lot of heat on the Republicans,” Hoyer said.

He criticized arguments that raising taxes on the wealthy would negatively affect small-business owners, saying it “is not going to impact at all, according to any economist, job creation in America. What it will do is give us resources to protect the most vulnerable in America.”

“Every bipartisan group that has looked at it says you cannot get to where we need to get if you do not deal with additional revenues, and very frankly, almost every Republican leader that I’ve talked to agrees,” Hoyer added.

While he does not want to see sequestration take effect, Hoyer said, Democratic leadership is not working to avoid it, and he believes Democrats will support a presidential veto on any legislation with that goal.

“We need to keep the sequester in place, but realize it is an incentive, a reason, a demand, if you will, that we come to an agreement and adopt a balanced response to the fiscal challenge that confronts us…The sequester was the discipline. If you now simply spend time figuring out ‘well how can we get around the sequester,’ frankly, it eliminate the discipline.”

UN Predicts Grim Economic Outlook for 2012

The world economy is on the brink of another recession and prospects for recovery will worsen unless the international community can strengthen cooperation, says the UN’s 2012 Report on World Economic Situation and Prospects.

“We have a situation where we may well be at risk of a double dip. In any case it is very likely there will be a further slow down.” says Jomo Kwame Sundaram, UN Assistant Secretary General for the Department Economic and Social Affairs (DESA).  

Sundaram and DESA director for policy and analysis Rob Vos where at the UN to preset an overview of the report, which will be released in the new year.

Sundaram says today’s announcement by China that its manufacturing sector had shrunk over the recent period is an ominous sign, especially for developing countries that for the most part had continued to do reasonably well during most of the crisis.

“We do not have the basis for a strong recovery in the developed world and what is likely to happen in the near future is the further deterioration of conditions in the developing world.” he said. “This current situation, in the view of the Chinese, is worst than the last quarter of 2008.”

Sundaram says the international community has so far failed to take collective action and adopt preventive measures to ensure possible future European debt problems can be contained. 

He says the complex political relationship between European national governments and the European Union framework, along with ideological differences between the White House and Congress have seriously limited any international consensus to addressing the crisis.

Rob Vos, Director of Policy and Analysis at DESA, says even in a best case scenario global economic growth will drop. 

“We project that the world economy could grow to 2.6% next year, that’s slightly down from 2.8% but that is already a pretty strong deceleration from what happened in 2010 when the world economy was growing at 4 percent.” 

Vos says projections are based on the assumption the European debt crisis will not reach the EU’s larger economies. But with both Italy and Spain coming under increased financial pressure, he says the worse case scenario is quite likely.

The report’s forecast also depends on Congress and the White House agreeing on the extension of payroll tax cuts and emergency borrowing benefits.

“If those two actions don’t happen, we estimate that the US economy could further slow by another one percentage point of growth next year, which would be further down from already slow growth of 1.7%.”

Vos says the US should also start thinking about short term stimulus measures to avoid an increase in home foreclosures, which he says continues to undermine the health of the banking sector and negatively impact the economy.

“There is weaknesses and some dangers in the mortgage market that because of the high unemployment, a lot of the home’s are underwater so to speak, that their debts are higher than the value of their homes, that there may be a need to give people more bridge loans to overcome those problems and to avoid more foreclosures.”

Pelosi: GOP Out To Get Middle Class

House Minority Leader Nancy Pelosi (D-Calif.) Thursday blasted Republican efforts to offset an extension of payroll-tax cuts set to expire at the end of December, but said House Democrats remain open to “reasonable, pay-for” options.

Democrats sought to pay for the tax holiday with a 3.5 percent surtax on incomes exceeding $1 million. Republicans countered by proposing a freeze on federal employees’ salaries and downsizing the federal workforce by cutting 200,000 jobs as a means to pay for the tax break. 

The House’s top Democrat, however, shied away from endorsing Republicans’ proposal, arguing that the offsetting proposal would eliminate hundreds of thousands of jobs. 

“It doesn’t make any sense, except it is consistent with the Republican principle that they are here for the one percent,” Pelosi said. “But yes, we would certainly be open to reasonable pay-fors for the tax cut.”

Pelosi continued her tirade against GOP efforts to offset the payroll-tax cut and said Republicans “are out to get the middle class.”  

“I don’t know what the middle class ever did to the Republicans that they’re so out to get them,” Pelosi said. “But whether it’s job creation, economic growth, the tax code and the rest — the deck is getting stacked against the middle class.”