A bipartisan group of senators forged agreement on a jobs bill that drew the White House's blessing Thursday - but hours later Senate Majority Leader Harry Reid scuttled the deal and replaced it with his own Democrat-written measure.
Scrambling to show Democrats are taking action to lower the 9.7 percent unemployment rate, Mr. Reid said the bipartisan proposal strayed too far from job creation and into special-interest giveaways.
"The message is so watered down, with people wanting other things in this big package that we're going to have to come back and finish [the jobs agenda later]," Mr. Reid, Nevada Democrat, told reporters. He said there is no reason for Republicans to oppose the smaller bill.
But Republicans said it was an about-face for Mr. Reid and accused him of kicking bipartisanship to the curb despite his and President Obama's repeated calls for the parties to work together.
They said Mr. Reid had initially signed off on the measure, crafted by Finance Committee Chairman Max Baucus, Montana Democrat, and Sen. Charles E. Grassley, the ranking Republican on the Finance Committee.
Mr. Reid's move "throws sand in the gears of bipartisan negotiation," a spokeswoman for Mr. Grassley said.
Minority Leader Mitch McConnell, Kentucky Republican, tried to offer the Baucus-Grassley jobs proposal on the Senate floor Thursday night but Mr. Reid blocked him.
Instead, Mr. Reid set the table for a partisan fight on his version, which would forgive Social Security payroll taxes for new hires who had been unemployed at least 60 days, fund highway and infrastructure projects and extend tax benefits to small businesses.
He scheduled a vote to head of a potential Republican filibuster on Feb. 22 vote - the day the Senate returns from a weeklong holiday. And Mr. Reid used parliamentary tactics to foreclose the chance for Republicans to offer amendments to his bill.
Minutes after he blocked the bipartisan proposal and introduced his own bill, Mr. Reid, who is in a difficult re-election race, took credit for the move in an e-mail to constituents back home. He said his version "will help put Nevadans back to work, cut taxes for business, and invest in job-creating transportation projects in our state."
Republicans said the maneuver appeared to be a redux of Mr. Reid's yearlong partisan push for a health care bill.
"After seeing how Democrat leaders handled the partisan health care debate of last year, today's bombshell shouldn't be a surprise," said Antonia Ferrier, a spokeswoman for Sen. Orrin Hatch, a Utah Republican who endorsed the Baucus-Grassley plan.
The Baucus-Grassley breakthrough wasn't the only glimmer of bipartisanship Thursday. Sen. Bob Corker, Tennessee Republican, said he's willing to work with Senate Banking Committee Chairman Christopher J. Dodd, Connecticut Democrat, to try to craft a financial regulation bill.
Mr. Reid's move to scuttle the broader jobs package was seen as a rebuke of Mr. Baucus, who had hoped to spearhead a bipartisan bill. Mr. Baucus was also major architect of the stalled health care overhaul.
But the majority leader said everything in his bill can gain support on both sides of the aisle.
"We have a bipartisan bill that will create jobs, according to the [Congressional Budget Office], immediately; not when the design's done, not when the planning's done, not when they hire people, but immediately," Mr. Reid said. "I don't know in logic what [Republicans] could say to oppose this, but in - we've seen since Obama was elected, they have opposed everything. They're the party of no."
Republicans and Democrats support the payroll tax cut proposal, but Mr. Hatch's office was disgusted at Mr. Reid's bid to ram the measure through while barring the chance to offer amendments.
Mr. Reid said that Congress is addressing the nation's anxiety over the climbing unemployment rate and that the slimmer bill is the best way to do that.
"We feel that the American people need a message," he said. "The message that they need is that we're doing something about jobs. We have - we don't have a jobs bill, we have a jobs agenda. And we're going to move forward on that jobs agenda."
The Baucus-Grassley bill contained the same provisions as the Reid bill plus an extension of tax breaks for energy efficiency, research and development and other initiatives. It also included the so-called "doc fix" to temporarily increase Medicare reimbursement rates, extended unemployment benefits and provided relief to pension plans to suffer significant losses in 2008.
The legislation would be paid for through eliminating tax benefits for certain biofuel producers, including so-called "black liquor" and cracking down on offshore tax abuses.
After the Baucus-Grassley plan was released, White House spokesman Robert Gibbs said President Obama was "gratified to see the Senate moving forward in a bipartisan manner."
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