JUDY WOODRUFF: With just over five weeks until the midterm elections, Democrats in Washington were grappling today with how to handle the Bush-era tax cuts. Senate leaders announced late Thursday they would wait until after the elections to vote on whether to end them.
But, today, House Speaker Nancy Pelosi wouldn't rule out action before November on extending tax breaks for the middle class.
REP. NANCY PELOSI (D-CA), Speaker of the House: Well, we will retain the right to proceed as we choose. We will take it one day at a time.
But let me -- let me be very clear, as we have all been clear and in the House Democratic leadership. America's middle class will have a tax cut. It will be done in this Congress. There is no question about that.
JUDY WOODRUFF: On the Senate side, the issue will have to wait until a lame-duck session in mid-November. Democratic Majority Whip Dick Durbin said Thursday: "We are so tightly wound up in this campaign, that it's impossible to see a bipartisan answer to the challenge we face. That's the reality before the election."
Republicans and some Democrats favor extending tax cuts for everyone, including the wealthy. Well, for more on all this, we turn to David Herszenhorn. He covers Capitol Hill for The New York Times. Thanks for being back with us.
DAVID HERSZENHORN, The New York Times: Good to be with you.
JUDY WOODRUFF: So, what -- what's this delay all about?
DAVID HERSZENHORN: Well, the Senate clearly doesn't want to get embroiled in this issue before the election. It's just too unpredictable and the storyline for Democrats is clean as things stand now.
They're making the case that Republicans would block tax relief for the middle class to hold out for tax breaks for the wealthy. Republicans, of course, want to extend those tax cuts for everyone. And so it's easier in the view of Democrats to push this until a lame-duck session. The political situation will obviously be less intense then.
But, as you said, the House speaker today left open the possibility of forcing a vote. And that could get really interesting next week.
JUDY WOODRUFF: Now, why the different calculus in the Senate and in the House?
DAVID HERSZENHORN: Well, the calculus probably isn't different. The conventional wisdom still is that, in the end, the House will decide to go home and campaign without taking this vote.
But there's no reason for Speaker Pelosi to relent right now, when she thinks she's got Republicans on the defensive. John Boehner, the Republican leader, a couple weeks ago, said, if given no choice, he would vote for President Obama's preferred plan, which is only a partial extension of the tax cuts.
So, she can continue to threaten to put that bill on the floor and see what the Republicans would do.
JUDY WOODRUFF: Now, this is more complicated because Democrats are divided among themselves. Talk about the regional differences and the other factors at play for Democrats.
DAVID HERSZENHORN: Well, it's really a question of political vulnerability at this point. For Democrats who are in very tough races -- remember, in '08, you had Democrats win in districts where Democrats really shouldn't win ever. It was a political fluke, so to speak. It's very hard for them to fight for reelection in traditionally Republican districts.
Casting this vote that might be portrayed as letting taxes rise on the wealthy -- Republicans say those are small-business owners in some cases -- can be used against them by opponents. So, there -- that political instinct to avoid that tough vote just five weeks before the election is up against more liberal Democrats who want to show a contrast and say, look, we're going to fight to do as President Obama promised during the presidential campaign, and let those tax cuts for the rich expire.
JUDY WOODRUFF: David, is it all about politics? Is there any policy at play here in their argument?
DAVID HERSZENHORN: It really is mostly about politics. Remember that a lot of folks will try and make this a debate about the federal deficit.
Continuing the tax breaks for the middle class will add about $3 trillion to the deficits over the next 10 years, extending them for everyone, $4 trillion. You are talking about, what is a trillion dollars between friends? If you get into the policy debate, it makes your head hurt, because you really have to start talking about long-term fiscal policy and reform.
JUDY WOODRUFF: And explain to us what the real deadline is here. These tax cuts were due to expire at the end of this year, unless something happens.
DAVID HERSZENHORN: Unless something happens. And, of course, Congress could work after the end of the year and apply the tax rates retroactively. It gets a lot more complicated for the IRS, to be sure. So, they would -- there are a lot of people who would prefer this not go down to the wire, but December 31 is the deadline.
JUDY WOODRUFF: But you -- and you could have, as you just suggested, a very different looking House.
DAVID HERSZENHORN: Once the election is done, the lame duck is the lame duck.
JUDY WOODRUFF: And the Senate.
DAVID HERSZENHORN: A lot will depend on what the results are in the November elections.
JUDY WOODRUFF: And, again, remind us, David, what taxes are we talking about, marginal income tax rates, and what else?
DAVID HERSZENHORN: Well, everybody is focused on the marginal income tax rates, but this actually is a whole range of things, capital gains tax, the estate tax, which, of course, right now doesn't exist. It's expired.
There are a big package of taxes other than the marginal rates that have to be wrestled with. That is what makes this complicated. And in the House, it is easier for Democrats to put a bill on the floor that matches what President Obama has proposed, letting the estate tax go back to 2009 levels, for instance.
In the Senate, everybody will have their say, and there will be lots of different variations of how you would put that whole package together. So it isn't easy.
JUDY WOODRUFF: It's so much fun to watch all this.
DAVID HERSZENHORN: Yes.
JUDY WOODRUFF: And it continues. David Herszenhorn, The New York Times, thanks very much.
DAVID HERSZENHORN: Sure thing.