Amid Deficit Worries, Democrats Trim Unemployment Bill

Associated Press + More

WASHINGTON — Virtually certain of losing a showdown vote in the Senate, Democrats frustrated in their quest to extend jobless benefits and help for doctors facing Medicare payment cuts are scaling back a catchall tax and spending bill.

Anxiety over record budget deficits is fueling the moves, which include rolling back last year's $25 a week increase in unemployment checks and giving doctors just a short reprieve from scheduled cuts in their Medicare payments.

First, however, comes a key vote Wednesday morning on a sweeping measure containing many provisions long overdue for completion by Congress, including the renewal of jobless benefits and dozens of popular but expired tax breaks for individuals and businesses.

It'll take at least two Republicans to clear a supermajority hurdle requiring 60 votes in the 100-member Senate since the pending version violates budget rules by adding $80 billion to the deficit over the upcoming decade.

Those votes are lacking, Democrats admit, even though an earlier version passed the Senate fairly easily just three months ago. Now, with voter anger over deficits rising, GOP support has evaporated, which means Democrats will have to pull out the shears and cut the measure back to have any hope of passing it with the handful of Republican votes that will be needed.

As a result, people on unemployment insurance are likely to see their benefits cut by $25 a week. Doctors are likely to win only a seven- month reprieve from a 21 percent cut in their Medicare payments that's set to take effect Friday. Those steps would appear to cut about $20 billion from the measure.

And it's not clear that those steps will be enough to attract the necessary GOP votes to reach the 60-vote threshold needed to advance an as-yet unseen, scaled-back version of the measure.

"They've laid the straw that broke the camel's back as far as I'm concerned," said Sen. George Voinovich, R-Ohio, who provided a critical vote to advance an earlier version of the measure in March. "We're talking $50 billion in new taxes, $80 billion in new borrowing. ... I've gotten to the point where I've had it." [See which organizations donate to Voinovich.]

Over the weekend, President Barack Obama renewed his push for the measure, warning that "hundreds of thousands" of state and local government jobs could be lost without $24 billion in Medicaid money to help states balance their budgets and $23 billion more to prevent layoffs at local school districts.

The pending bill is a catchall measure anchored by a six-month extension of jobless benefits for people who have been out of work for more than six months. It also includes the $24 billion in help for cash-starved state governments, dozens of expired tax breaks for individuals and businesses, a fivefold increase in the per barrel tax on oil drilled offshore and a new tax on investment fund managers.

Nine Republicans supported the earlier version of the bill against a GOP filibuster, as did every Democrat but Ben Nelson of Nebraska. Now, a lot of that support has eroded.

"I'm very concerned about the cost of the bill," said Susan Collins, R-Maine.