Bloomberg News

Israel Says Republican Payroll Tax Position Will Help Democrats

December 15, 2011

(For more on the campaign, see {ELECT <GO>}.)

Dec. 9 (Bloomberg) -- Representative Steve Israel, leading Democrats’ campaign to win back control of the U.S. House, assailed Republicans’ position on extending the payroll tax break, saying it will backfire politically and help Democrats.

House Speaker John Boehner of Ohio wants to tie approval of the Keystone XL oil pipeline to the extension of the payroll tax cut and to ease restrictions on some industrial emissions.

“Only the House Republicans would decide to load a middle- class tax cut with pork,” Israel said in an interview for Bloomberg Television’s “Political Capital with Al Hunt” airing this weekend. Democrats need to pick up 25 seats in order to win back control of the chamber.

“We have seats in play that we didn’t anticipate would be in play, and it’s because of this extremism, this assault against the middle class,” said Israel, of New York.

“The more they pursue this extremist agenda and try and hurt the pocketbooks of the middle class in order to reward their special-interest friends, the more Republican seats will be in play,” Israel said.

President Barack Obama has said he would reject efforts to tie approval of the pipeline to the extension of the payroll tax cut. Boehner said it should be included because development of the pipeline will create jobs.

The proposed TransCanada Corp. pipeline would carry oil from Canada to the U.S. The Obama administration, citing environmental concerns, put off a decision on it until 2013.

Corzine Donations

Israel also said he’s undecided on whether to return about $130,000 in contributions from Jon Corzine, the former New Jersey governor and head of MF Global Holdings Ltd. who told a congressional panel yesterday he doesn’t know what happened to an estimated $1.2 billion in missing client funds.

Under subpoena and under oath, the former senator apologized to investors, customers and employees of the failed New York broker.

In the eighth largest U.S. bankruptcy, MF Global filed for protection from creditors on Oct. 31. James Giddens, the trustee overseeing the liquidation of the firm, has estimated that $1.2 billion in client money is missing, and the Commodity Futures Trading Commission, Securities and Exchange Commission and Justice Department are investigating.

“We’ll make every decision based on the facts at hand, but we’re not going to react to something that the Republicans say, when in fact they enjoy the largess of the Koch brothers” and others, Israel said. Billionaire brothers Charles and David Koch, owners of Koch Industries Inc., spent millions in the 2010 midterm elections to elect Republicans.

‘Stealth Groups’

“I find it interesting that Republicans, who have engaged in this kind of activity and who enjoy the support of these secret, stealth groups, who are beaming into campaigns saying the most nefarious things about people without telling you who’s paying for it,” he said, “they can hide behind those groups.”

Israel outlined a path to capturing the 25 seats needed for Democrats to overtake the House.

He said Democrats are targeting 19 districts now represented by Republicans that voted both for Massachusetts Senator John Kerry for president in 2004 and Obama in 2008. “We’ll win at least half of those seats,” he said.

In total, there are 43 districts that have a Republican member of Congress and which also voted for Obama. “We’ll win at least 15 of those 43,” he said. “I’m not saying we’re going to win 25 seats,” said Israel. “It’ll be razor close.”

Voter Frustration

In 2006, voter frustration resulted in the loss of Republican leadership of both the House and Senate. Two years later, the electorate gave the Democratic Party the White House and complete control of the legislative process. In 2010, voters rebelled anew, setting off a pro-Republican wave that flipped House control and pared the Democrats’ margin of power in the Senate.

Republican lawmakers claimed a mandate for shrinking government through deep budget cuts and a plan to convert Medicare into a voucher system. Now their numbers and those policies will work against Republicans, said Israel.

“We have a mathematical advantage,” he said. “They’ve got to defend 60 seats where incumbents voted to end Medicare who are saying they will not support a middle-class tax increase but are going to support the full extension of the Bush tax cuts.”

Democrats must overcome newly drawn congressional maps that provide more safety to vulnerable Republicans and a president struggling with low job approval ratings as voters worry about an economy with joblessness at 8.6 percent.

Israel said he doesn’t believe Obama’s poll showings are an albatross for House Democrats seeking re-election.

“There is a certain reality here that the president’s numbers are challenged in certain areas,” he said. “But House Republican numbers are about half of where the president is. They are lethal. They are radioactive.”

--Editors: Robin Meszoly, Mark Silva

To contact the reporter on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net


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