One of the biggest wildcards in the economy right now: The fate of the payroll tax cuts that were agreed to last year. They're do to expire at the end of this year, and if they're not extended the ramifications could be huge.

The tax cut provides the average American family with an extra $1000 in their pocket each year — and President Barack Obama has said failing to extend the tax cut and unemployment benefits would cost the economy 1 million jobs and 0.5% off GDP.

Obviously it's a big deal for Obama to make this happen, and while theoretically Congress has until December 31 to act, in reality, Congress could adjourn much earlier, meaning this is all going to play out over a couple weeks. Days, really.

So what specifically do the Democrats have in mind?

Sen. Chuck Schumer (D-NY) said Senate Democrats will put forward a plan to extend the payroll tax cut into 2012 this week paid for by a surtax on those with incomes greater than $1 million.

Schumer added that Democrats would keep introducing the payroll tax cut if it fails this week — but indicated his party is willing to negotiate other "pay-fors" with Republicans if necessary.

Americans for Tax Reform president Grover Norquist said on the same program that he is not opposed to extending the tax cut, but he indicated he would be opposed to a new tax on millionaires to pay for it.

The fights over the payroll tax cut extension and expiring unemployment insurance is set to become the latest flash-point in Congress after the failure of the super committee. The Congressional Budget Office says the payroll tax cut is one of the most effective ways to create jobs, after continuing aid to the unemployed.

Watch the video below: