Tax Cuts Battle Royale: Obama vs. Boehner vs. McConnell vs. Reid vs. Senate Democrats...

ABC News' Matthew Jaffe reports:

The debate over the expiring Bush tax cuts has kicked into high gear with both Democrats and Republicans trying to inflict political wounds on each other, but in reality the battle lines are blurry on both sides.

With Congress coming back into session today after its summer recess, neither party appears to have a coherent political message on the tax cuts.

Just look at the last two days. Yesterday top House Republican John Boehner signaled he might compromise on the issue, all part of an effort to ruin the Democrats’ talking point that the GOP was holding middle-class tax cuts “hostage.” But today Senate Majority Leader Harry Reid is making that exact argument by seizing on a statement from the spokesman for the top Senate Republican.

Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell, today said all Senate Republicans are united in opposition to President Obama’s plan to extend the Bush tax cuts only for individuals making under $200,000 and couples making under $250,000. That differs from Boehner’s comments Sunday that – if he had no other choice – he would vote for an extension of tax cuts for middle-class Americans even if it didn’t include one for the wealthy.

Cue Harry Reid, Senate Majority Leader.

“It is unconscionable for Senate Republicans to hold middle-class tax cuts hostage in order to secure more tax giveaways for millionaires and CEOs who ship American jobs overseas,” Reid said. “Today’s declaration by Senate Republicans means they are willing to raise taxes on the middle class and small businesses in the middle of a recession.”

So much for doing away with that “hostage” line.

“Regardless of what any individual Senator may think about tax cuts for the wealthiest Americans, I had hoped we could all agree that middle-class families deserve to have their taxes cut,” said the Nevada lawmaker. “But by this Republican logic, until rich CEOs get what they want, middle-class families can't get what they need. This is not only wholly unfair to hard working families in Nevada and across the country, but it is bad economic policy that will hurt our nation and its recovery.”

However, while Reid is ripping Republicans, he’s got plenty of problems within his own caucus. Even if one GOP senator were to cross the aisle to support Obama’s plan, Reid right now does not have all 59 Senate Democrats on board – and far from it. Sens. Kent Conrad, Evan Bayh, Ben Nelson, and Joe Lieberman have all voiced opposition to raising taxes on anyone during a recession.

“I don’t think it makes sense to raise any federal taxes during the uncertain economy we are struggling through,” Lieberman said today in a speech in Connecticut. “The more money we leave in private hands, the quicker our economic recovery will be. And that means I will do everything I can to make sure Congress extends the so-called Bush tax cuts for another year.”

Meanwhile, another handful of Senate Democrats such as Jim Webb and Michael Bennet have also indicated that they are open to ideas other than Obama’s. One possible compromise recently floated by Webb was raising the cut-off level from $250,000.

Over in the House, as well, lawmakers are not on the same page within the two parties. While Boehner might be willing to support only tax cuts for middle-class Americans if faced with no other option, the number-two Republican Eric Cantor today said he was not about to blink on this issue.

"Raising taxes in this environment is a non-starter for me," said Cantor, calling for a vote on extending the tax cuts for all Americans including the wealthiest tier.

As for House Democrats, four of them are now collecting signatures on a letter to Speaker Nancy Pelosi urging the extension of all the Bush tax cuts.

Whatever happens, don’t hold your breath for anything to go down before the November mid-terms. As Democrat Jack Reed of Rhode Island pointed out last week, the chances of anything getting done before then are “very limited.”

- Matthew Jaffe

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