This morning, Harry Reid received a letter in which the Senate Republicans have pledged to halt all action on lame duck legislative items until a deal is reached on tax cuts.  In this Nov 29 letter to Reid, signed by all 42 GOP Senators, Republican Whip Jon Kyl (R-AZ) and Republican Leader Mitch McConnell (R-KY) penned the following:

“… we write to inform you that we will not agree to invoke closure on the motion to proceed to any legislative item until the Senate has acted to fund the government and we have prevented the tax increase that is currently awaiting all American taxpayers. With little time left in this Congressional session, legislative scheduling should be focused on these critical priorities. While there are other items that might ultimately be worthy of the Senate’s attention, we cannot agree to prioritize any matters above the critical issues of funding the government and preventing a job-killing tax hike.”

Jon Kyl has been an important anti-gambling figure in the poker-politico scene, maintaining his objections to internet gambling since his election to Senate in 1994. He was a key figure in the passage of UIGEA, and stands strong against the act’s repeal.  Notably, “angry about the Treasury’s role in delaying the enforcement of the UIGEA”, Kyl blocked US Treasury officials from taking office this past February.  He is also a key supporters of the controversial internet domain blacklist bill – the Combatting Online Infringement and Counterfeits Act (COICA).  Perhaps the Homeland Security knew that all such lame duck actions would be stalled by the GOP when they preemptively seized 82 “illegal” domains last week under the moniker: Operation Our Sites II.

A video of Reid’s reaction to the Kyl/McDonnell filibuster was published on the SenateDemocrats YouTube channel today.

According to an article on the filibuster published in The Hill, “McConnell and other congressional leaders met with President Obama at the White House Tuesday to try to reach a deal on the tax cuts.” In Reid’s video, he states that Kyl has been chosen by the Republican party to represent them in these negotitations.  Reid has selected Max Baucus (D-MT), chairman of the Senate Finance Committee, to represent the Dems.

A number of measures, in addition to COICA and the completely dead HR 2267, that have been hoping for motion during the last session of the 111th Congress, are the DREAM Act (immigration reform bill), extensions on the nation’s unemployment benefits, a repeal of “Don’t ask, Don’t tell”, and the long-stalled nuclear arms START treaty.

Everyone can rest safely on one account: @SenatorReid tweeted today that the bipartisan food safety bill made it in just under the wire.

The idea of using online gaming tax revenues to help fund elements of health care reform became part of the Congressional conversation this weekend. On Saturday, Sen. Ron Wyden (D-OR) introduced a possible amendment to the Baucus bill (America’s Healthy Future Act of 2009) that would rely on the passage of Rep. Barney Frank’s HR 2267 to set up a regulatory structure that would provide health care revenue.

According to the Safe and Secure Internet Gambling Initiative, the tens of billions of dollars collected by the U.S. government from online gaming could offset health care costs going forward:

An increased focus on the benefits of Internet gambling regulation are expected as the Senate Finance Committee considers a proposal introduced on Saturday to use Internet gambling revenue to offset the costs of health care reform. The amendment offered by Senator Ron Wyden (D-OR) would dedicate Internet gambling tax revenue generated through implementation of the currently pending Internet Regulation, Consumer Protection and Enforcement Act (H.R. 2267) to increase low-income subsidies provided through the America’s Healthy Future Act of 2009. A PricewaterhouseCoopers analysis shows that collecting taxes on regulated Internet gambling would allow the U.S. to capture up to $62.7 billion over the next decade.

Wyden is a chairman of the Senate Finance subcommittee on International Trade, Customs and Global Competitiveness.

Barack Obama is in Montana today — where he’ll be cavorting with Sen. Max Baucus (D-MT)*, who is chairman of the Senate Finance Committee, and therefore has to come up with ways to fund any major health care reform. A daunting challenge to be sure, but a good time to float the possibility of floating Sen. Robert Menendez’s (D-NJ) online poker bill as a potential source of much-needed revenue.

An op-ed in today’s Missoulian — titled “Fund reform with Net poker tax” — does exactly that:

Instead of raising taxes during an economic slump to pay for these programs, what if Baucus and his colleagues could collect revenue that’s currently going to other countries from an industry that’s ready and willing to be taxed?

That industry is Internet poker, and Baucus can help make this a reality by supporting his colleague from New Jersey, Sen. Bob Menendez, who recently introduced a bill to license and regulate online games of skill such as Internet poker.

According to recent economic studies, tax revenue from licensing will add billions to the U.S. Treasury. Projections have shown that as much as $3 billion annually could be raised through Internet poker, which can be used to help fund key domestic priorities, like health care.

If the Dems are serious about passing Obamacare, then they should have a hard time turning their back on a few billion to pay for it annually. Of course, as we know, politics is seldom about what makes sense.

* Not to be confused with the strongly anti-poker Rep. Spencer Bachus (R-AL).