The U.S. House of Representatives rejected a two-month extensionof an expiring payroll tax cut, escalating a clash with the Senateand President Barack Obama that may result in smaller paychecks forworkers in January.

In a 229-193 vote, the House requested formal negotiations on apayroll tax cut extension with the Senate, where Democratic leaderssay they won't discuss a year-long agreement until the short-termdeal is completed. All House Democrats joined seven Republicans invoting against the Republican rejection.

The impasse might hurt consumer spending and economic growth. IfCongress can't reach agreement, the 2-percentage- point payroll taxcut would expire Dec. 31 and workers' paychecks would be reduced.Expanded unemployment benefits also would expire, and doctors wouldreceive smaller Medicare reimbursements starting in January.