President Barack Obama speaks to continue to push Congress to act to extend the payroll tax cut and unemployment insurance through the end of the year, Tuesday, Feb. 14, 2012, in the Old Executive Office building on the White House complex in Washington. (AP Photo/Pablo Martinez Monsivais)
President Barack Obama speaks to continue to push Congress to act to extend the payroll tax cut and unemployment insurance through the end of the year, Tuesday, Feb. 14, 2012, in the Old Executive Office building on the White House complex in Washington. (AP Photo/Pablo Martinez Monsivais)
President Barack Obama speaks to continue to push Congress to act to extend the payroll tax cut and unemployment insurance through the end of the year, Tuesday, Feb. 14, 2012, in the Old Executive Office building on the White House complex in Washington. (AP Photo/Susan Walsh)
Sen. Charles Schumer, D-NY, talks to reporters about the payroll tax, Tuesday, Feb. 14, 2012, on Capitol Hill, in Washington. (AP Photo/Jacquelyn Martin)
WASHINGTON (AP) ? House-Senate talks on renewing President Barack Obama's signature payroll tax cut made significant progress Tuesday, and aides said an agreement could be announced later in the day.
"Barring a blowup, a deal will probably be acknowledged tonight," a Democratic aide said, speaking on the condition of anonymity to assess the private negotiations.
Under the emerging pact, a 2 percentage-point cut in the Social Security payroll tax would be extended through the end of the year, with the nearly $100 billion cost added to the deficit. Jobless benefits for the long-term unemployed would be renewed as well, with the $30 billion or so cost paid for in part through auctioning broadcast spectrum to wireless companies and requiring federal workers to contribute more toward their pensions.
The payroll tax cut and renewing jobless benefits were key planks in Obama's jobs program, which was announced in September. The payroll tax cut benefits 160 million Americans and delivers a tax cut totaling $2,000 this year for someone making a $100,000 salary and a cut of $20 a week for a typical worker making $50,000.
It's not only a win for Obama but takes the payroll tax fight ? which had Republicans on the defensive ? off the table for the fall elections campaign.
The potential agreement also would avert a huge cut in Medicare payment to doctors, financed by cuts elsewhere in the federal health care budget, a Democratic aide said.
Any agreement would depend on the reaction of the House GOP rank and file, who were scheduled to discuss the matter at a meeting Tuesday evening.
But Senate Democrats were rebuffed in an effort to renew expired tax breaks for individuals and businesses at a cost of about $20 billion.
Republicans, who just Monday said Democrats hadn't been negotiating in good faith, agreed with the positive assessment.
"There is definitely positive progress," said Michael Steel, a spokesman for House Speaker John Boehner, R-Ohio.
A GOP aide, also requiring anonymity to discuss the talks, said negotiators were finalizing an agreement on reducing the number of weeks jobless workers would be eligible to receive unemployment benefits to a maximum of 63 weeks in most states. Maximum benefits are now 99 weeks in states with the highest jobless rates.
And in a win for the Hispanic community, a Senate Democratic official said it appeared Republicans would drop a proposal to require that low-income workers who claim a refundable child tax credit be required to have a Social Security number.
The proposal was aimed at blocking illegal immigrants from claiming the credit, but the idea created a firestorm among Hispanics who pointed out that many of the children affected by the cutoff are U.S. citizens.
Republicans also were expected to drop a proposal requiring unemployed people to enroll in GED classes to obtain benefits, and a GOP proposal allowing states to employ drug tests as a condition of receiving unemployment benefits would be scrapped as well. But Republicans won a provision requiring jobless people to be more diligent in job searches as a condition of receiving benefits.
Tuesday's developments came just a day after GOP leaders announced that they would relent on a demand that the cost of renewing the payroll tax cut be defrayed by spending cuts elsewhere in the budget. That made it significantly easier for negotiators to come up with savings to pay for the remaining items.
Obama weighed in Tuesday, urging Congress to act immediately to renew both the payroll tax cut and jobless benefits for millions of workers who have been out of work for more than six months.
"Just pass this middle-class tax cut. Pass the extension of unemployment insurance," Obama said at a White House appearance. "Do it before it's too late and I will sign it right away."
Democrats in the Senate warned Republicans that they would pay a political price for extending the payroll tax cut while allowing millions of jobless people lose their unemployment benefits.
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