WASHINGTON (Reuters) – President Barack Obama demanded on Tuesday that Republicans in the House of Representatives pass a short-term extension of a payroll tax cut, showing an unwillingness to back down in a fight that could result in higher taxes for 160 million Americans.

The Republican-led House earlier rejected a short-term deal passed by Democrats and fellow Republicans in the Senate over the weekend and called for fresh negotiations on the expiring tax break that saves the average American worker $1,000 a year.

As both sides dug more deeply into entrenched positions, House Speaker John Boehner, the top Republican in Congress, demanded Obama order Senate Democrats back into session to haggle over a year-long extension.

“I need the president to help out,” Boehner told reporters, drawing applause from a large group of Republican lawmakers standing behind him in the Capitol.

The show of solidarity stood in contrast to the revolt by conservative and Tea Party-backed House Republicans after Boehner was reported to have initially sought their support for the shorter extension over the weekend. U.S. payroll tax break fate uncertain.

Boehner has struggled to control his restive caucus all year, with a refusal by many members refusing to negotiate with Democrats pushing the federal government to the brink of three shutdowns and the edge of a debt default.

In a surprise appearance in the White House briefing room, a visibly frustrated Obama told lawmakers to put politics aside. “Let’s not play brinkmanship,” he said.

WASHINGTON (Reuters) – In Congress’ tense drama over how to extend payroll tax cuts for 160 million Americans, it may be the most intriguing subplot: whether Republican House Speaker John Boehner is losing his grip on members of his own party.

Boehner and many Republicans scoff at the idea.

But the House’s rejection on Tuesday of a bipartisan Senate plan to extend the tax cuts for two months has raised questions about Boehner’s efforts to lead compromise-resistant House Republicans who have helped ratchet up the tension in Congress.

The House’s move drew blistering criticism from President Obama, Democratic leaders and even some Senate Republicans, many of whom called the House vote a symbol of the dysfunction that has plagued Congress this year.

Democratic Rep. Chris Van Hollen of Maryland said the House vote reflected how Boehner has allowed Tea Party-backed conservative Republicans to overrun bipartisan agreements.

Van Hollen said that has been a constant theme in this congressional session.

And Scott Brown, a Republican senator from Massachusetts, called the House move “irresponsible and wrong.”

WASHINGTON (Reuters) – In Congress’ tense drama over how to extend payroll tax cuts for 160 million Americans, it may be the most intriguing subplot: whether Republican House Speaker John Boehner is losing his grip on members of his own party.

Boehner and many Republicans scoff at the idea.

But the House’s rejection on Tuesday of a bipartisan Senate plan to extend the tax cuts for two months has raised questions about Boehner’s efforts to lead compromise-resistant House Republicans who have helped ratchet up the tension in Congress.

The House’s move drew blistering criticism from President Obama, Democratic leaders and even some Senate Republicans, many of whom called the House vote a symbol of the dysfunction that has plagued Congress this year.

Democratic Rep. Chris Van Hollen of Maryland said the House vote reflected how Boehner has allowed Tea Party-backed conservative Republicans to overrun bipartisan agreements.

Van Hollen said that has been a constant theme in this congressional session.

And Scott Brown, a Republican senator from Massachusetts, called the House move “irresponsible and wrong.”

WASHINGTON (Reuters) – President Barack Obama and fellow Democrats on Wednesday considered dropping their proposed surtax on millionaires in a bid to reach a deal with Republicans to extend a payroll tax cut for 160 million Americans set to expire at year’s end.

Obama discussed the possibility of abandoning the millionaire tax, which Republicans strongly oppose, at a White House meeting with Senate Majority Leader Harry Reid and other top Senate Democrats, a senior Senate Democratic aide told Reuters.

“It remains to be seen if we will drop it,” the aide said. “But we want to strike a deal and get this done.”

The action comes amid an end-of-year rush in Congress to find deals on several major initiatives beyond the payroll tax cut extension.

The two political parties are still fighting over a nearly $1 trillion spending bill to keep several government agencies operating through the end of the fiscal year on September 30. Without action by Friday at midnight, these agencies would have to close, further eroding sagging public confidence in elected leaders.

Congress also is trying to extend jobless benefits for the long-term unemployed so that those payments do not start phasing out early next year, as well as passing legislation to avoid a cut in government payments to doctors participating in the Medicare healthcare program.

Democrats will not consider making any offer on the millionaire surtax, however, until Republicans agree to negotiate, another Democratic aide said.

WASHINGTON, Dec 14 (Reuters) – The United States on Wednesday faced the prospect of an imminent government shutdown for the third time this year as a year-end fight between Republican and Democratic lawmakers in Congress over taxes and spending turned nastier.

Democrats, led by President Barack Obama, are refusing to sign off on a bipartisan $1 trillion government funding bill that would keep federal agencies operating beyond Friday. They first want Republicans to agree to a compromise deal to extend a payroll tax cut for 160 million Americans.

The Republican-led House of Representatives passed its version of the payroll tax cut bill along a mostly party-line vote on Tuesday, but Democratic Senate Majority Leader Harry Reid has vowed to kill it as soon as he can bring it to a vote.

The Republican bill proposes to pay for the $120 billion cost of the payroll tax cut largely by freezing federal pay and shrinking the size of the government work force. Democrats reject that and are instead proposing a surtax on millionaires.

Republicans in the Senate blocked a Democratic bid on Wednesday to quickly reject the House bill, which also includes a provision to speed up a decision on an oil pipeline that the White House has delayed for further environmental studies.

Senate Republican leader Mitch McConnell stymied Reid’s effort to dispose of the Republican bill, saying he wanted to turn first to the government funding bill.

In an exchange on the Senate floor, Reid objected to McConnell’s move, insisting the payroll tax bill first be considered.

WASHINGTON (Reuters) – Republican and Democratic lawmakers were locked in an end-of-year fight on Tuesday that threatens a government shutdown, an effective tax hike for 160 million Americans and the loss of benefits for millions of unemployed.

With just days left to resolve the crisis, both parties accused each other of “playing politics” with Americans’ livelihoods even as they tried to gain the upper hand with a complex series of maneuvers on Capitol Hill.

At the center of the drama are efforts to extend aid to the long-term unemployed and a payroll tax cut for Americans that some economists say will boost the country’s fragile economic recovery, and a massive spending bill that will keep the government operating beyond Friday.

Republicans in the House of Representatives defied a veto threat from President Obama and passed a bill that would force him to speed up a decision on a controversial oil pipeline even as it renews a payroll tax cut that Democrats have been seeking.

The bill was widely expected to pass the Republican-led chamber and will almost certainly die in the Democratic-controlled Senate.

Senate Majority Leader Harry Reid said he wanted to hold a vote on the Republican measure within the next day or so, so that negotiations could begin in earnest on a compromise deal.

While both Republican and Democratic leaders have expressed confidence that the payroll tax cut and unemployment benefits will be extended before December 31, it remains far from clear how both parties will find common ground.

WASHINGTON (Reuters) – A Republican bid to force President Barack Obama to speed up approval of the Keystone XL Pipeline project looked set to pass the House of Representatives on Tuesday but will likely stall in the Democratic-controlled Senate, aides said.

Republicans have linked the proposed Canada-to-Texas oil pipeline to President Barack Obama’s efforts to extend a payroll tax cut for workers. Some economists warn that allowing the tax cut to expire could damage a fragile U.S. economic recovery.

The top Republican in Congress, Speaker John Boehner, said on Monday he was confident the House would pass a Republican measure that includes extending the tax cut beyond this year and sets a deadline for a decision on the fate of the delayed pipeline, which has drawn fire from environmentalists.

Boehner did not predict Senate passage, but told reporters, “I think we have a good shot.”

For the House bill to win Senate approval, 13 Democrats would need to join the chamber’s 47 Republicans to provide the needed 60 votes to clear a procedural hurdle. Only a handful of Democrats are expected to vote yes, aides said.

The State Department effectively slammed the brakes on the Republican effort on Monday. It said plans to fast-track the Keystone XL decision would violate environmental laws and force it to withhold approval.

“Should Congress impose an arbitrary deadline for the permit decision … the department would be unable to make a determination to issue a permit for this project,” the State Department said in a statement.

WASHINGTON, Dec 11 (Reuters) – U.S. Senate Republican Leader Mitch McConnell predicted on Sunday that Congress will renew a popular payroll tax cut, but it remained unclear how lawmakers will resolve deep differences before the Dec. 31 deadline.

While he did not unveil a new deal, McConnell signaled that he and others anticipate having one soon.

“We’re going to reach an agreement,” McConnell told “Fox News Sunday,” noting there is “bipartisan support” for extending the tax cut.

The 4.2 percent payroll tax that workers pay to fund the Social Security retirement system will return to 6.2 percent in January if Congress fails to act. That would raise taxes on 160 million Americans an average of about $1,000 per family.

Democrats have led the charge to extend the tax break, raising pressure on Republicans to join in or face possible voter backlash in next November’s congressional elections.

The House of Representatives is set to approve a Republican plan as early as Tuesday to extend the tax cut, tying it to a bid to accelerate approval of TransCanada Corp’s (TRP.TO: Quote, Profile, Research, Stock Buzz) Keystone XL pipeline project between the United States and Canada.

Senate Democratic Leader Harry Reid has said the plan would be rejected by his chamber because of the Keystone pipeline provision opposed by President Barack Obama.

WASHINGTON (Reuters) – Democratic and Republican lawmakers skirmished on Friday over plans to extend a payroll tax cut seen as crucial to a fragile U.S. economic recovery, but aides predicted a last-minute deal.

While independent economists say extending the tax cut would boost the economy at a critical time, both parties have been struggling to agree on a compromise deal in a rerun of this year’s budget battles that have knocked investor confidence in Washington’s ability to deal with its fiscal problems.

Both parties are under pressure to strike a deal at a time of economic difficulty. Failure to do so would mean an effective tax hike for millions of voters in 2012, when Republicans and Democrats will face off in presidential and congressional elections.

“The optics politically to be seen blocking an extension of payroll tax is lousy – and neither wants their fingerprints of blame on it for not getting it done before Christmas,” said Ethan Siegal of The Washington Exchange, a private firm that tracks Washington for institutional investors.

Senior party aides predicted on Friday that common ground would be soon be found to extend a reduction of the payroll tax, which helps fund the Social Security federal retirement program, and renew jobless benefits for millions of Americans.

“Everybody figures it will happen. It has to. No one wants to raise taxes or end jobless benefits,” one aide said. “The only real question if it will be next week or the week after.”

Democrats pounced on Republican moves to include a controversial pipeline project in the tax-cut bill, citing environmental concerns. But they also said attempts by Republicans in the House of Representatives to kill new federal controls on industrial boilers and incinerators would keep toxic pollutants like mercury in the skies for years to come.

WASHINGTON (Reuters) – Democratic and Republican lawmakers skirmished on Friday over plans to extend a payroll tax cut seen as crucial to a fragile U.S. economic recovery, but aides predicted a last-minute deal.

While independent economists say extending the tax cut would boost the economy at a critical time, both parties have been struggling to agree on a compromise deal in a rerun of this year’s budget battles that have knocked investor confidence in Washington’s ability to deal with its fiscal problems.

Both parties are under pressure to strike a deal at a time of economic difficulty. Failure to do so would mean an effective tax hike for millions of voters in 2012, when Republicans and Democrats will face off in presidential and congressional elections.

“The optics politically to be seen blocking an extension of payroll tax is lousy — and neither wants their fingerprints of blame on it for not getting it done before Christmas,” said Ethan Siegal of The Washington Exchange, a private firm that tracks Washington for institutional investors.

Senior party aides predicted on Friday that common ground would be soon be found to extend a reduction of the payroll tax, which helps fund the Social Security federal retirement program, and renew jobless benefits for millions of Americans.

“Everybody figures it will happen. It has to. No one wants to raise taxes or end jobless benefits,” one aide said. “The only real question if it will be next week or the week after.”

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