Nobody Puts Barry in the Corner

Today's Balance Sheet covers the House Republicans' cave-in on the payroll tax cut and the inequality dragon.

December 23, 2011

4:31 PM

The long battle is over, and the troops are headed home. House Republicans finally caved on a two-month extension on the payroll tax cut, realizing that their intransigence was winning them nothing but voter contempt. Congress cleared the $33 billion legislation this morning. The only concessions rewarded to the obstructionists were a minor provision protecting businesses from a few payroll-reporting requirements and an agreement to push a conference committee to negotiate a year-long extension on the tax cut.

The undeniable winners of this legislative fight were the Democrats. Although the pressure to eke out a compromise was intense, they didn't cave. They can now start off the election year with an impressive win that will broadcast well on the airwaves and show voters that they are the party that pushes to help the middle class. President Barack Obama is also starting 2012 in an excellent position. He spent most of the tax-cut debate in the shadows, but on Tuesday he told the House: "Let's be clear: Right now, the bipartisan compromise that was reached [in the Senate] on Saturday is the only viable way to prevent a tax hike on January 1st. It's the only one." Two days later, Republicans relented. The resolution to the payroll-tax fiasco shows that the compromise president is willing to play hardball, which will help him once election season kicks into high gear.

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CHART OF THE DAY

Wonkblog asked economists and policymakers to pick their favorite charts that sum up 2011's news on the economy. Jared Bernstein picked this one, which shows the gulf growing between worker compensation and corporate profits growing, and proves that dragons actually make the data look less scary.

-Wonkblog, On the Economy

REASON TO GET OUT OF BED IN THE MORNING

The Occupy movement gained a new offshoot yesterday when "Community" fans, dressed as Evil Abed and Troy, occupied Rockefeller Plaza and sang beloved holiday classics like "O Christmas Troy."

-Gothamist

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