We've largely ignored the not-so-great payroll tax debate on the assumption that it would pass in any case and won't matter much to the economy. But now things are getting interesting: If Republicans hang tough, they might even get a useful policy victory in return for giving President Obama his political fillip.
Keep in mind that the payroll tax "cut" is nothing more than a tax holiday. All the political palaver is about extending it for one more year, through 2012, so Mr. Obama can claim he did something for middle-class voters before Election Day. Because it is temporary, the tax holiday will do little to change employer incentives to hire
Which makes it all the more important for Republicans to show some achievement for their first year controlling the House. They're trying to do that now with a series of policy riders in the spending and payroll-tax bills, and two in particular are worth stressing because they have considerable Democratic support.
One provision would force a decision on the Keystone XL pipeline within 60 days. This is the most shovel-ready project in America, as the TransCanada company has already made plans to buy the steel pipe to carry crude oil from Canada and the Upper Great Plains to the Gulf of Mexico. The pipeline would create thousands of new jobs, both immediately and downstream, which is why the Teamsters and other unions support it.
But Mr. Obama's green financiers see the pipeline as a conveyer of evil carbon, and so the President recently postponed any decision past the election into 2013. Now, that's economic leadership.
To give Mr. Obama a spinal implant, the House passed a provision that would give TransCanada a permit to start building in 60 days if the President does nothing. He can still kill the pipeline if he objects. But at least Hamlet of Pennsylvania Avenue would have to make up his mind.
Republicans are in a strong bargaining position, and there's no reason for them to give in to the Senate or the White House. We doubt Mr. Obama is willing to see the payroll tax holiday die in the name of stopping regulatory relief and a pipeline that will create more jobs. Republicans will have a great election issue if he does.