WatchSonoma Watch

Woolsey, Thompson reject bill to cut payroll tax


The North Coast’s two Democratic Congress members resisted the tide of bipartisan support for renewing a Social Security payroll tax cut Friday, voting against the main legislation on President Barack Obama’s jobs agenda.

Both said the sweeping support in the House and Senate was overshadowed by serious flaws in the legislation.

Lynn Woolsey and Mike Thompson

“They borrowed $100 billion to do that,” said Rep. Mike Thompson, D-St. Helena, referring to the cut in money paid into Social Security from paychecks. “Tax cuts ought to be paid for.”

And Rep. Lynn Woolsey, D-Petaluma, who is retiring this year after 20 years in Congress, objected to reductions in federal pensions and funding for preventative health care.

The Senate approved the $143 billion measure 60-36 minutes after the House approved it 293-132, with 41 Democrats voting no. Obama is expected to sign it shortly after returning from a West Coast fundraising swing.

Under the bill, workers would continue to receive a 2 percentage point increase in their paychecks, and people out of work for more than six months would keep jobless benefits averaging about $300 a week.

Obama said the steps will help support a fragile recovery from the worst economic downturn since the Great Depression.

Many GOP lawmakers and some Democrats were upset that the measure would add to the deficit and doubted it would do much to boost the economy. Another concern was that it cuts a payroll tax that’s dedicated to paying Social Security benefits.

The agreement also would head off a steep cut in reimbursements for physicians who treat Medicare patients.

It would be paid for by trimming Medicare reimbursements to health care providers to cover unpaid medical bills, cutting payments to hospitals that treat large numbers of poor patients and cutting a fund created in Obama’s health care overhaul for preventing diseases caused by smoking and obesity.

Thompson criticized cutting payments to hospitals and said the bill missed a chance to craft a longtime fix to the problem of Medicare payments to doctors.

Woolsey criticized the cuts as “damaging to the middle class.”

“We don’t need to squeeze federal employees and slash funding for preventive health care in order to extend unemployment benefits,” she said in a statement.

Extending the 2 percentage point cut in the 6.2 percent Social Security payroll tax would save around $80 monthly for someone earning $50,000 a year and give a maximum cut of $2,200 to high-end earners.

The reduction in the payroll tax would cost $93 billion through 2022. In a sudden concession this week that made bipartisan agreement possible, House Republicans dropped their demand that the tax cut be paid for with spending reductions.

In a GOP win, coverage for the long-term unemployed would be cut from the current maximum of 99 weeks to a ceiling of 73 weeks by this fall in states with the worst job markets, with most topping out at 63 weeks.

Of the $30 billion cost of the extended unemployment benefits, half would be paid for by government sales of parts of the nation’s broadcast airwaves, and half by requiring federal workers hired after this year to contribute an additional 2.3 percent of their pay for their pensions, up from the current 0.8 percent.

That increase also would apply to members of Congress, but only to those who begin service as of next January, exempting current lawmakers.

This story includes information from the Associated Press. You can reach Staff Writer Sam Scott at 521-5431 or sam.scott@pressdemocrat.com.

7 Responses to “Woolsey, Thompson reject bill to cut payroll tax”

  1. Money Grubber says:

    PAUL PAYNE says in his article on Annadel Park that there is a $6.00 ” USE FEE. ”

    Never heard of a “use fee,” Paul Payne.

    A $6.00 parking fee, yes, but not a park “use fee.”

    Care to provide the concrete details on that?

    The neighborhood access points around the park don’t even have a place for a fee to be deposited so how would you describe it as a “use fee?”

    Answer: you either made a guess or the park staff was floating a fictional idea.

    BAD reporting, Paul.

  2. Whine Country Romance says:

    You are all idiots for allowing Lynn Woolsey to continue serving until retirement. You deserve all of the crumbling roads, misspent tax revenue, and shrinking middle class, that you VOTED FOR.

  3. JOHN says:

    Woolsey really is a moron. “Tax cuts have to be paid for…” What? No….if you cut taxes, then you cut spending to compensate for the loss in revenue. How about Congress starts adding Social Security and Medicare to the annual budget figures. Remember, the generation that is collecting SS is also the generation that owns a diproportionate amount of the country’s wealth. Cut the taxes and cut the spending…its that easy. Please fade away Woolsey

  4. Reality Check says:

    Since the Social Security Trust Fund has no money in it, why is it important we pretend SS taxes go into a trust fund? Either we have the political will to tax young workers to pay benefits for retirees or we don’t.

    It’s reassuring to talk about a trust fund securing SS’s future, but it’s a fiction. Al Gore’s “lock box” contains nothing but IOUs. SS has become an intergenerational tax that transfers money from the young (and often poor) to the old (and usually not poor).

    Most politicians of course bow before this outrage. Evidence that votes matter more than morality for most politicians today.

  5. bear says:

    Obama is really off base with this one.

    Extension of unemployment benefits is fine.

    But this 2% cut in payroll taxes will not help anyone but the highest earners, and will set the stage for the destruction of Social Security and Medicare.

    More bipartisan BS.

  6. Mike Tabulara says:

    Lynn, you can’t see the forest through the trees. Who’s side are you on anyways? Thankfully, you are retiring.

  7. Juvenal says:

    That’s a 2% increase to paychecks, but a 2% reduction in funding for Social Security. Careful.