President Obama's big victory in the payroll-tax fight will have important consequences for his 2012 re-election campaign. Most important, he showed that he is willing to stick to his guns and get his way in a confrontation with Republican adversaries. This is likely to soften Democratic criticism that Obama is a weak negotiator who gives in too quickly.
The resolution came after House Republicans backed down from their opposition to a Senate-White House compromise that extended the payroll tax cut for two months for 160 million Americans.
The House GOP preferred a year-long extension, along with other conservative provisions, but there was no agreement on how to pay for the lost revenue to the government. As the stalemate continued this week, the reaction against the House GOP grew severe and angry, even from some Republicans such as Sen. John McCain of Arizona. So the House Republicans backed down. The resulting deal, nearly the same as the Senate and White House version, will preserve the tax cut for two more months and give congressional negotiators time to extend it for a full year.
"This is good news, just in time for the holidays," Obama said last night. "This is the right thing to do to strengthen our families, grow our economy and create new jobs This is real money that will make a real difference in people's lives."
House Speaker John Boehner tried to put the best face on the deal but his glum manner and terse statement revealed a man who was coping with defeat. "It's time to do solid policy," Boehner noted. "It's time to do it the right way."
But for many Americans, it was time to stop the spectacle of hyper-partisanship and brinkmanship.
In sum, here are my five takeaways from the week: