WASHINGTON—The Senate unveiled final details of a broad tax bill—and its 10-year price tag of $858 billion—and began debate Thursday night on the package, a significant step after two years of gridlock over how to treat expiring tax cuts enacted under former President George W. Bush. Without action, income taxes on nearly every American are due to rise on Jan. 1. 
 
 The Senate has moved quickly after Mr. Obama and Republican leaders unveiled the package Monday, with a key test vote now scheduled for Monday. The bill is expected to pass with support from most Senate Republicans and a substantial number of Democrats, after lawmakers agreed to extend expiring subsidies for ethanol and other alternative-energy sources. Backers now include Senate Majority Leader Harry Reid (D., Nev.), who had been withholding support over the bill's tax cuts for upper-income taxpayers. 
 
 House Democrats continued to voice opposition to a tax deal between the White House and Republicans on Thursday and urged leaders not to bring the agreement up for a formal vote. Jerry Seib has the latest from Washington 
 
 But in the House, Democrats were in open revolt. In a closed-door gripe session, they chanted "Just Say No," capping a remarkable day of political theater before passing a nonbinding resolution that said the tax agreement shouldn't be considered in the House unless changes were made. 
 
 That resolution isn't seen as a threat to the tax deal, which includes a two-year extension of current tax rates for all income brackets, not just for income up to $250,000, as Democrats want. But the rebellion represented essentially a "no confidence" vote in the White House on a crucial issue. 
 
 Anger focused on the tax treatment of wealthier Americans and the fact that House Democratic lawmakers were frozen out of negotiations that produced the agreement. "This is not an acceptable package. We want a better deal,'' said Rep. Peter DeFazio (D., Ore.). House Speaker Nancy Pelosi (D., Calif.) suggested that she didn't want to kill the tax package, just change it. "We will continue discussions with the president and our Democratic and Republican colleagues in the days ahead to improve the proposal before it comes to the House floor for a vote," she said in a written statement. 
 
 The rebellion among House Democrats reflected more than opposition to the legislation. It also showed the frustrations of a party bruised by heavy midterm election losses, and signaled that Mr. Obama may spark significant turbulence within his party as he tries to work with a newly empowered GOP next year. "A number of us are very frustrated. It is finally time for us to stop being spear-carriers here," Mr. DeFazio said. "It's time to tell the White House they are wrong.'' But House Democrats may have little power to change the basic framework of the tax deal. 
 
 Republicans generally support the package, though several conservative GOP lawmakers say it will add too much to the nation's budget deficit. Michael Steel, spokesman for House Republican Leader John Boehner (R., Ohio), said: "President Obama has said that failing to stop all of the job-killing tax hikes scheduled for January 1 will have serious consequences for our economy. House Republicans agree." 
 
 Enlarge Image Close Associated Press Obama meets with the Export Council as House Democrats rebel on taxes. 
 
 Tax provisions in the package will cost $801 billion over 10 years, according to Congress's bipartisan Joint Committee on Taxation. A 13-month extension of enhanced benefits for the long-term unemployed adds $57 billion. Because the bill identifies no offsetting cuts in federal spending, the entire amount, which is close to earlier estimates, will add to the deficit. 
 
 In unveiling the bill, the Senate added details to its treatment of inheritances. The federal tax on estates expired at the end of 2009 and is set to be reinstated from 2011 at a top rate of 55%, charged on estates over $1 million. The legislation would renew the tax at a top rate of 35% on estates over $5 million. In the bill released Thursday, the $5 million would be indexed for inflation, so it's real value wouldn't shrink over time. House Democrats want the tax to be set at a higher rate. Some are collecting signatures on a letter urging the tax be set at 45% for estates above $3.5 million. 
 
 In a sweetener for many Democrats, the package extends a program of cash grants for wind and solar projects, as well as tax credits for energy-efficient appliances, although at reduced, pre-stimulus levels. It includes favorable tax treatment for mass-transit benefits for employees. It also includes a one-year extension of a 45-cent-a-gallon tax credit for fuel made from ethanol, a provision sought by farm-state lawmakers. 
 
 Jim Manley, a spokesman for Mr. Reid, said the House Democrats' protest would have no impact on the bill's progress in the Senate. "This vote demonstrates they may be irrelevant to this process," said Mr. Manley. White House Press Secretary Robert Gibbs said he still believed the agreement would pass this year without substantial changes. 
 
 —Jonathan Weisman and Patrick O'Connor contributed to this article. 
 
 Write to Janet Hook at Janet.Hook@dowjones.com ||||| The White House and key lawmakers cleared the way Thursday night for swift Senate action to avert a Jan. 1 spike in income taxes for nearly all Americans, agreeing to extend breaks for ethanol and other forms of alternative energy as part of the deal. 
 
 Sen. Bernard Sanders, D-Vt., heads for the Senate floor for cloture votes on Capitol Hill in Washington, Thursday, Dec. 9, 2010. (AP Photo/Harry Hamburg) (Associated Press) 
 
 Budget Director Jacob Lew, second from right, gestures during a meeting of the Deficit Commission in the Roosevelt Room of the White House in Washington, Thursday, Dec. 9, 2010. From left are, Commission... (Associated Press) 
 
 Vice President Joe Biden, left, and House Speaker Nancy Pelosi talk as they leave a Democratic Caucus meeting on Capitol Hill in Washington, Wednesday, Dec. 8, 2010. (AP Photo/Manuel Balce Ceneta) (Associated Press) 
 
 Tax provisions aimed at increasing production of hybrid automobiles, biodiesel fuel, energy-efficient homes, coal and energy-efficient household appliances would be extended through the end of 2011 under the bill. 
 
 Debate on the expanded measure began almost immediately. While there is no precise timetable for passage, a test vote was set for Monday afternoon that appears likely to demonstrate overwhelmingly support for the legislation, which supporters say would help accelerate a sluggish recovery from recession. 
 
 The events unfolded as the White House predicted that the agreement between President Barack Obama and top Republicans would clear by year's end _ even though House Democrats voted Thursday not to allow it to reach the floor without changes to scale back tax relief for the rich. 
 
 "If it's take it or leave it, we'll leave it," said Rep. Lloyd Doggett, D-Texas, after a closed-door meeting in which rank-and-file Democrats chanted, "Just say no." 
 
 "The deal will get passed," said presidential press secretary Robert Gibbs. There were no predictions to the contrary among senior Democrats on either side of the Capitol. 
 
 As announced by Obama on Monday, the deal would extend tax breaks at all income levels that are due to expire on Jan. 1, renew a program of jobless benefits for the long-term unemployed that is due to lapse within days and implement a one-year cut in Social Security taxes. 
 
 At the insistence of Republicans, it also includes a more generous estate tax provision. That, in turn, infuriated Democrats already unhappy with Obama for agreeing to extend personal tax cuts at incomes over $200,000 for individuals and $250,000 for couples. 
 
 The two-year cost of the plan, estimated at about $850 billion, would further swell record federal deficits. 
 
 Despite significant criticism from fellow Democrats, Obama has said the sweeping measure is necessary to help the struggling economy recover from the worst recession in decades. With unemployment at 9.8 percent, a top White House official warned Democratic critics Tuesday they risk sending the economy back into recession if they block the measure. 
 
 In the Senate, the emergence of bipartisan legislation also indicated progress for the White House and Senate Majority Leader Harry Reid, D-Nev., toward possible year-end passage of other major items on their agenda. 
 
 Obama has made ratification of a new arms control treaty with Russia a top priority. The White House is also pressing Reid to try once more to end the Pentagon's 17-year ban on openly gay members of the military. 
 
 Republicans have vowed to block action on all legislation until a tax bill and a year-end government spending bill have been resolved. 
 
 Senate Republican leader Mitch McConnell has said he expects most of his rank and file to support the huge tax bill. Prominent House Republicans back it, too, although they have generally refrained from speaking out at a time when doing so would divert attention from the spectacle of Obama at odds with lawmakers of his own party. 
 
 Rep. John Boehner of Ohio, in line to become House speaker when Republicans take power in January, "supports the framework as agreed to by" Obama and McConnell and spoke with the president about it over the weekend, a spokesman said Thursday. 
 
 Rep. Paul Ryan of Wisconsin, whose views on economic issues are influential among House Republicans, also swung behind it. "While I have concerns with some specific aspects of the plan, I support the proposed framework to avert further economic hardship and provide a first step to restore the foundations for sustained growth and job creation," he said in an interview. 
 
 Among the energy tax provisions added was an extension of the current 45-cent per gallon subsidy for ethanol, at a cost to the Treasury estimated at nearly $5 billion. The issue is of particular interest to lawmakers from Midwestern states with grain crops. 
 
 The changes did nothing to ease the opposition among some critics, though. Liberal Sen. Bernie Sanders, I-Vt., attacked the measure's tax breaks for the wealthy as a threat to the middle class. 
 
 The energy-related tax provisions will presumably increase support for the measure in the House, officials said Democrats there are eager to see a scaling back of a provision that would allow estates as large as $5 million escape taxation. 
 
 Speaker Nancy Pelosi, D-Calif., said, "That was a bridge too far for many of our members" already upset about Obama's decision to bow to Republican demands for extending tax cuts on individuals making over $200,000 and couples earning more than $250,000. 
 
 Under the estate tax provision, the first $5 million of a couple's estate could pass to heirs without taxation, and an additional $5 million for the spouse. The balance would be subject to a 35 percent tax rate. 
 
 According to a Tax Policy Center estimate based on census data, that would mean only about 3,500 estates would be liable for taxes in 2011, out of more than 2.5 million forecast to be filed. Barring legislation, about 44,000 estates would be subjected to taxation in 2011, the groups said. 
 
 Some Democratic officials suggested a relatively minor change to the estate tax portion of the Obama-GOP deal might assuage critics of the plan. If accepted, however, it could come at a price in the form of additional concessions to Republicans, several officials said. 
 
 Vice President Joe Biden has told Democrats in closed-door meetings this week that they are free to oppose the agreement but it might unravel if they do, according to officials familiar with the discussions. 
 
 Whatever the disagreement over the economic wisdom of renewing tax cuts for the wealthy, the legislation also marks the emergence of a new era of divided government following midterm elections in which the Republicans won power in the House and gained seats in the Senate. 
 
 Privately, several House Democrats complained that the White House had not consulted them while negotiating a deal with McConnell. 
 
 The House passed a measure last week that would have let the tax cuts lapse at higher incomes, but Senate Republicans blocked it on Saturday _ with the knowledge the president had already agreed he was ready to sign a measure that was more to their liking. 
 
 Democrats and Republicans have spent two years gridlocked over the question of extending the expiring tax cuts, and Obama has characterized his compromise with Republicans as a temporary, two-year concession on a policy he opposes. 
 
 House and Senate Democrats debated privately in the weeks before the elections whether to hold votes on the issue. They decided not to at that time after lawmakers who were seeking re-election said they would prefer not to have go on record if it meant Republicans would attack them for raising taxes on small businesses. 
 
 ___ 
 
 Associated Press writers Charles Babington and Stephen Ohlemacher contributed to this report. ||||| Senate Majority Leader Harry Reid just scored a political victory by losing a vote. That sounds counterintuitive, but it's true. By failing to bring the Wall Street reform bill written by Chris Dodd to the floor for debate, and by losing a cloture vote on the issue to Republican opposition, Reid has shown that the Democrats (and the White House) have learned a few lessons from the health reform debate. Because by refusing to back down, and refusing to "compromise" (read: water the bill down and add loopholes for Wall Street) with Republicans, Reid is showing real strength, and real leadership. 
 
 Harry Reid is from a gambling (or, if you're employed by the industry, "gaming") state. And he has just raised the stakes, because he thinks he's got a winning hand in this debate. The Washington Post just released a poll today showing that reforming Wall Street is wildly popular with the public at large (two-thirds are for it), which certainly helps Reid's position. But just because an issue (or a sub-issue) is popular with the public, it doesn't always win in Congress (see: public option). Sometimes politicians squander the issue's popularity, and drive away their own supporters by continually weakening and gutting the bill they're debating. 
 
 There's another sort of strategy for this situation, and it is precisely the strategy Reid and President Obama have taken -- refuse to give in to the lobbyists. Stand up for strong reform, and shout it from the mountaintops. Defy Republicans to obstruct the effort, and vow to exact a political price upon them for doing so. This is precisely what Reid just did. 
 
 Republicans, in this metaphorical card game, not only have a bad hand to play, but they were actually allowed to thumb through the deck and pick their own cards, and they still have no good cards to play. 
 
 Because Republicans tried to bluff. They tried to hinge their arguments for obstruction on "we want to make the bill stronger," when (of course) nothing could be further from the truth. What they really would like is to make a backroom deal with Chris Dodd, and water the bill down, far from the light of day. What they most assuredly do not want is for this bargaining to happen on the floor of the Senate, in the open, with everyone watching. If debate on the bill proceeds, then Republicans are free to offer amendments to strengthen the bill, if they so desire. Democrats would likely even support a few of these, if they truly did strengthen the bill. But any loophole-filled lobbyist-written amendments are simply not going to pass. Which terrifies Republicans, who don't really want a stronger bill to begin with. 
 
 The way to deal with this bluff is, so far, exactly what the Democrats have done. First, make lots of political hay decrying the obstructionism of the Republicans, painting them as being nothing more than Wall Street's handmaidens. Second, when challenged by Republicans to strengthen the bill, then actually strengthen the bill, and then dare Republicans to oppose it. Thirdly, don't just threaten to hold votes and force cloture (filibuster) votes, actually follow through and put the Republicans on the record voting with Wall Street, and against reform. Fourthly, make it obvious that this issue will be the number-one favorite for Democrats to run campaign commercials on, in the upcoming elections. 
 
 So far, Democrats have been doing all of these things, and actually doing a fairly good job of them. Instead of entering the bargaining from a position of "let's give away the store before we even begin talking" (see: health reform debate), Democrats are (for once!) throwing down gauntlet after gauntlet to Republicans -- "well, if you're complaining that the reforms aren't strong enough, then we will strengthen them!" 
 
 Republicans, it should be noted, are getting very, very nervous about their overall obstruct-everything strategy in this particular debate. They're scared. You can tell, because almost without exception, every Republican interviewed on television of late has admitted that "something's going to pass." Compare this to their stance during health reform, when they were confident nothing would get through. Republicans, in essence, are already admitting that they're going to lose this one, and that President Obama is going to score a major political victory, likely before Memorial Day. 
 
 Today's vote was a party-unity affair. Minority Leader Mitch McConnell got all 41 Republican senators to sign a letter, formalizing his filibuster bluff, a few weeks ago. He held them together today. But he is likely not going to be able to do so on subsequent votes. Republican unity is going to crack. And a trickle of Republican votes crossing the aisle to vote for Wall Street reform could become a flood, by the time the final vote is taken (after the House and Senate hammer out the final language in committee). There are two reasons for this: Republicans saw that story on the polls, too; and the only way Republicans can explain today's vote on the campaign trail is going to be: "we forced Democrats to strengthen the bill, so that we could then we could support it." It wouldn't surprise me in the least to see the final vote on Wall Street reform win with 80 or 90 votes in the Senate, and a similar overwhelming majority in the House. 
 
 President Obama released a statement after the vote. It doesn't pull many punches. Here's the full text of it: 
 
 I am deeply disappointed that Senate Republicans voted in a block against allowing a public debate on Wall Street reform to begin. Some of these Senators may believe that this obstruction is a good political strategy, and others may see delay as an opportunity to take this debate behind closed doors, where financial industry lobbyists can water down reform or kill it altogether. But the American people can't afford that. A lack of consumer protections and a lack of accountability on Wall Street nearly brought our economy to its knees, and helped cause the pain that has left millions of Americans without jobs and without homes. The reform that both parties have been working on for a year would prevent a crisis like this from happening again, and I urge the Senate to get back to work and put the interests of the country ahead of party. 
 
 This shows Obama has also learned the lessons of the health reform battle: don't compromise early, fight for a strong bill instead, and don't let your opponents define the playing field. And do not back down. 
 
 Two footnotes to today's vote are the two Democrats who voted with the Republicans. The first one is a technicality, since Harry Reid switched his vote to "nay" when he saw he was going to lose. This is, as I said, a technicality which allows him to reintroduce the bill later (which he swears he's going to do, possibly as early as tomorrow -- which, conveniently, has scheduled the chairman of Goldman Sachs testifying before a committee hearing), and should in no way be seen as a lack of support on Reid's part. 
 
 The second Democrat who voted with the Republicans was Ben Nelson of Nebraska, who was trying to get a sweetheart deal inserted in the bill for his constituent Warren Buffett. You'll remember Senator Nelson from the health debate, for pulling the same maneuver to extract the "Cornhusker Kickback." This time, however, the Democratic leadership didn't blink, and refused to play ball with Nelson. Nelson will now find himself in a very untenable political position (as he did with the Cornhusker Kickback) and will likely end up sheepishly changing his vote to "yea" at some future time in this debate. Thus showing the power of transparency, and why it is good politics to bring these backroom deals out into the open. 
 
 As I said, today's vote, while seeming to be bad news (we'll see how the mainstream media spins this one...), is actually stunningly good news for Democrats everywhere. Because it shows that two of the "weakest links" in the health reform debate -- Harry Reid and President Obama -- are actually out in front, and doing a good job of leading, on Wall Street reform. They appear to be moving in lockstep, defiantly resisting calls to water the bill down. And they're also not exactly being shy about explaining their position -- to a public who already approves of what they're doing by a two-to-one margin. 
 
 If both Obama and Reid can keep this up, it will prove a political case many progressives and liberals were trying to get them to understand, last August. If you get out in front of strong reform that the public overwhelmingly approves of, not only will you draw some of your opposition over to your side eventually, but you also will boost the public's approval of what you are trying to accomplish. Many Lefties were absolutely disgusted at how the health reform battle played out, and with good reason. Sinking poll numbers for both Obama and Reid have driven that point home even further, ever since. Democrats appear to have learned this lesson, and are trying it a different way this time around. 
 
 And, I have to say, they are being led in these efforts admirably well by both President Obama and Senate Majority Leader Reid. This is going to lead to, eventually, a much better bill on the president's desk. Far fewer things will be "thrown under the bus" in this debate. Of course, no bill is perfect, and there may be disappointments along the way, but arguing from a position of strength means you will have to accept fewer compromises during the process. And that is good news, for this bill, for reforming Wall Street, for the American public, and for the Democrats in general and for Harry Reid and Barack Obama in particular. 
 
 Chris Weigant blogs at: 
 
 Follow Chris on Twitter: @ChrisWeigant
– The Senate voted to begin debate on a bill based on Barack Obama’s tax cut deal last night, with the final vote expected to be held Monday. The Senate’s version of the bill will add $858 billion to the deficit over 10 years, the Wall Street Journal reports. Though the bill largely follows the White House outline, lawmakers tacked on an extension of subsidies for ethanol and alternative energy sources to sweeten the deal for Democrats. The previously-reticent Harry Reid is now behind the bill, and predicts it'll pass with nearly all Republicans and many Democrats supporting it. The House, on the other hand, is in open revolt; yesterday, in a closed-door session, Democrats were actually chanting “Just Say No,” as they voted against bringing the proposal to the floor. "If it's 'take it or leave it,' we'll leave it," one Democrat told the AP. But a Reid spokesman had this to say about the House: “This vote demonstrates they may be irrelevant to this process."