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With one week left until Congress is scheduled to adjourn for holiday recess, Senate Democrats are considering dropping a millionaire surtax designed to pay for a payroll tax break to 160 million Americans.

The 2 percent surtax on income of those making $1 million or more (revised down from 3.25 percent), was loathed by Republicans and, according to Politico's Jake Sherman and Manu Raju, Senate Democrats are "seriously" looking to replace it with a "series of cost-cutting offsets that can win GOP backing, according to people familiar with the talks." The goal is to present an end-of-year payroll tax plan on their terms while casting the party as a reasonable broker.

The potential compromise would be the second development making life easier for House Speaker John Boehner, whose colleagues have been deeply skeptical of a payroll tax compromise. The first helpful development was President Obama's Wednesday threat to veto a Republican proposal that includes a provision on the controversial Keystone XL pipeline. According to The Hill's Russell Berman, Erik Wasson and Bernie Becker, the idea that Obama would reject the proposal has inflated support for it among rank-and-file Republicans. "Boehner defied the president on the issue and won over many skeptics in the process," writes the paper. Rep. Jeff Flake of Arizona tells the paper “The difference between this conference and the last one was palpable. I think a lot of it was the president and that threat.” Rep. Mike Coffman of Colorado said the attitude shift was a "stunning change ... It was a 180-degree difference."