Obama makes case for payroll tax cut in battleground Pennsylvania

By Peter Nicholas and Lisa Mascaro, Washington Bureau

Nov. 30, 2011 12 AM PT

Reporting from Scranton, Pa. — President Obama accused Congress of voting in ways that “don’t reflect who we are as a people,” as he urged lawmakers to expand a payroll tax cut that he said is crucial to boosting the economy and aiding middle-class families who can’t afford to see their tax bill jump by about $1,000 next year.

Obama came to a struggling corner of this perennial battleground state Wednesday to build a public consensus for his tax plan, a cornerstone of his $447-billion jobs package.

“Send your senators a message,” the president said in the Scranton High School gymnasium. “Tell them, ‘Don’t be a Grinch!’ ”

The Senate is expected to vote, possibly Thursday, on the first of what Democratic leaders promise will be multiple runs at approving the payroll tax extension by year’s end.

Democrats will put forward a plan that would cut the payroll tax in half -- to 3.1% – increasing what is now an estimated $1,000 annual tax break to $1,500. The proposal would also give employers who hire new workers a full holiday from the 6.2% tax for 2012. At a total cost of $240 billion, the plan would be covered by a 3.25% surtax on incomes for individuals and married couples beyond $1 million.

“If they vote no, then the typical family’s taxes will go up by $1,000 next year,” said Obama, who removed his jacket for the speech. “If they vote yes, then the typical family will have an extra $1,500. If they vote no, your taxes go up. If they vote yes, you get a tax cut. Which way do you think Congress should vote?”

The crowd, sitting in bleacher seats decorated with red, white and blue bunting, shouted, “Yes!”

So far, Congress has rejected the main planks of Obama’s jobs plan, but the president said that lawmakers this week are getting another chance to “redeem themselves.”

At this point, it looks as if Obama and fellow Democrats won’t be able to overcome a Republican-led filibuster.

Speaking on the Senate floor Wednesday morning, Senate Republican leader Mitch McConnell of Kentucky said the issue is “whether we should help those who are struggling in a bad economy by punishing the private-sector businesses that the American people are counting on to help turn this economy around.”

Still, congressional Democrats believe they can gain political traction through an approach that taxes the rich for the purpose of extending a tax break that goes to 160 million American workers. Even a failed vote would enable Democrats to portray Republicans as siding with millionaires over average Americans.

Obama reiterated a message that is sure to be a main theme of his reelection campaign, as he blames a “do-nothing” Congress for persistently high unemployment.

“What does it say about our values when we’d rather fight for corporate tax breaks than put construction workers back on the job rebuilding our roads, our bridges and our schools?” he said.

He commended Pennsylvania’s state senator Robert Casey for supporting his efforts. “I love Sen. Casey,” he said.

He said nothing about the state’s other senator, Republican Pat Toomey.

Obama made mocking references to Republicans who’ve balked at his tax cut plan -- perhaps out of reflexive opposition to his agenda – even though they “swore an oath to never raise taxes on anybody as long as they live.”

Someone from the crowd shouted, “Give us some names!”

Obama laughed.

As the backdrop for his speech, Obama chose a county, Lackawanna, that is older and poorer than the rest of Pennsylvania.

An article in the Scranton Times-Tribune this week said the county housing authority is cutting off applications for public housing, an attempt to prune a waiting list that now numbers 1,700.

Obama’s approval ratings have been dropping steadily in Pennsylvania, in no small part because of the sputtering economy.

A Quinnipiac poll showed that his approval rating this month stood at 44% -- down more than 20 points since the first months of his presidency.

“People are just frustrated. They’re hurting; they’re desperate,” said Evie Rafalko-McNulty, the Lackawanna County recorder of deeds.

Nicholas reported from Scranton; Mascaro from Washington.