House Nixes Bush Tax Cuts; Senate Fights On

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The House voted Thursday to extend middle-class tax cuts while letting Bush-era tax cuts for the wealthy expire -- but the debate over 2011 tax breaks is far from over.

Most American will see their taxes go up in a matter of weeks if Congress doesn't extend the Bush-era tax cuts. And Senate Republicans said they won't consider any other legislation until there's a vote.

"Instead of beating around the bush, Congress ought to act today to stop all the tax hikes, to cut spending because it would reduce the uncertainty that's affecting employers all across our country," Rep. John Boehner, R-Ohio, said.

"The American people said on Election Day, 'Stop the games. Stop the spending, Stop the looming tax hikes,'" he added.

Symbolic Vote

Thursday's 234 to 188 House vote is mostly symbolic.

The vote came as the lame-duck Democratic majority sent a message to its base that they are fighting until the end -- by not extending tax cuts for upper-income Americans making more than $250,000.

"You have to pay for unemployment insurance," House Speaker Nancy Pelosi, D-Calif., said. "We don't have to pay for tax cuts for the rich."

President Barack Obama has also made it clear he supports tax cuts for those making under $250,000.

"I am confident no one wants to see taxes go up on middle class families starting Jan. 1," Obama said.

The Real Battle

The real fight is in the U.S. Senate where Republicans are flexing their influence.

A filibuster-proof majority of 42 GOP senators have sent a letter to Majority Leader Harry Reid, D-Nev., promising to block all Democratic legislation until the Senate votes to extend all of the Bush-era tax cuts -- including those making above $250,000 -- and passes a budget bill needed to keep the government running into the new year.

The move blocks efforts by Democrats to bring forward other legislation, including a repeal of the military's "don't ask, don't tell" policy on gay troops.

"Our constituents have repeatedly asked us to focus on creating an environment for private-sector job growth," the Republicans wrote. "It is time that our constituents' priorities become the Senate's priorities."

"We are going to extend the current tax rates," said Sen. Mitch McConnell, R-Ky. "We're not going to raise taxes on anybody. The only thing we're discussing now is just how long that extension will be."

How Long to Extend?

With just days to go until the tax cuts run out, preliminary bipartisan discussions led by U.S. Treasury Secretary Tim Geithner have begun. Officials said talks have centered on a one to three year extension of the current rates.

"We had a very civil, constructive discussion," Geithner said.

White House spokesman Robert Gibbs told ABC News that the president has drawn a "line in the sand" against a permanent extension of tax cuts to "the wealthiest Americans."

However, the president, who's grappling with the looming loss of a Democratic majority in the House, is apparently signaling a temporary extension of all the tax cuts may be possible.

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Jennifer Wishon

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Jennifer Wishon is the White House correspondent for CBN News based in the network’s Washington, D.C. Bureau.  Before taking over the White House beat, Jennifer covered Capitol Hill and other national news, from the economy to the 2010 oil spill in the Gulf of Mexico. Follow Jennifer on Twitter @JenniferWishon and "like" her at Facebook.com/JennWishon.