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News Wrap: Democrats Introduce New Plan to Extend Payroll Tax Cuts

December 5, 2011 at 12:00 AM EDT

KWAME HOLMAN: Wall Street began the week with new gains, amid new hopes for progress on the Europe debt problem. Major bank stocks were among the day’s biggest winners. Overall, the Dow Jones industrial average added 78 points to close near 12098. The Nasdaq rose nearly 29 points to close at 2655.

Senate Democrats have offered a new plan to extend the payroll tax cut, due to expire at the end of December. Majority Leader Harry Reid unveiled a smaller package today, financed with spending cuts and a scaled-back surtax on the wealthy. Last week, Democrats and Republicans in the Senate blocked each other’s proposals.

At the White House today, President Obama pressed Republicans again to agree to a plan.

PRESIDENT BARACK OBAMA: Now is not the time to slam on the brakes. Now is the time to step on the gas. Now is the time to keep growing the economy, to keep creating jobs, to keep giving working Americans the boost that they need. Now is the time to make a real difference in the lives of the people who sent us here. So let’s get to work.

KWAME HOLMAN: Democrats say letting the payroll tax cut expire would cost the average family about $1,000 a year. But a number of Republicans question whether the tax cut actually has done any good.

Arizona Senator Jon Kyl spoke for them today.

SEN. JON KYL R-Ariz, Minority Whip: There’s no evidence that this temporary tax cut has actually produced any new jobs, which is the whole idea. In fact, our economy has decelerated. In 2010, we had a 2.8 percent GDP growth. We’re now down to just over 1 percent.

KWAME HOLMAN: On another point, a spokesman for House Speaker John Boehner argued again today that a surtax on higher incomes would hurt small businesses and kill jobs. The Senate is expected to vote on the new version of the payroll tax extension later this week.

A series of bombings in Iraq today killed at least 32 people and wounded nearly 100 others. The attacks struck Shiite pilgrims as they traveled across the country for the observance of Ashura. It commemorates the split between Shia and Sunni Islam. The latest violence comes as U.S. forces pack up to leave the country by year’s end.

The U.S. and scores of other nations pledged today to continue supporting Afghanistan after most foreign forces leave in 2014. The commitments came at a conference in Bonn, Germany. Afghan President Hamid Karzai said his country will need financial support for at least another decade after the troops leave. Pakistan boycotted the conference, protesting a NATO airstrike last month that killed 24 Pakistani soldiers.

About 10,000 Russians protested in Moscow this evening over Sunday’s parliamentary elections. They charged the voting was rigged to favor Prime Minister Vladimir Putin and his United Russia party. Official results showed United Russia took about half the vote. Observers had predicted a much lower percentage. The ruling party got 64 percent of the vote in the last elections.

Russian President Dmitry Medvedev defended Sunday’s results.

DMITRY MEDVEDEV, Russian President (through translator): No doubt, the election was fundamentally different from anything we have ever had, for a variety of reasons. I can share my impressions. United Russia got exactly as many votes as it has supporters, not more, not less. Thus, the election was absolutely fair and democratic.

KWAME HOLMAN: The most vocal Russian opposition groups were barred from the elections. European observers criticized the conduct of the voting. And U.S. Secretary of State Hillary Clinton said she had serious concerns as well.

In Egypt, runoff elections for parliament were held today, but turnout appeared to be down sharply from last week’s initial round of voting. The Muslim Brotherhood garnered nearly 37 percent of the votes last week, followed by a harder-line Islamist party with 24 percent.

Those are some of the day’s major stories.