Another Possible Bump to the Debt Ceiling

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By Jonathan Weisman and Shailagh Murray
Tuesday, May 9, 2006

A $2.7 trillion budget plan pending before the House would raise the federal debt ceiling to nearly $10 trillion, less than two months after Congress last raised the federal government's borrowing limit.

The provision -- buried on page 121 of the 151-page budget blueprint -- serves as a backdrop to congressional action this week. House leaders hope to try once again to pass a budget plan for fiscal 2007, a month after a revolt by House Republican moderates and Appropriations Committee members forced leaders to pull the plan.

Leaders also hope to pass a package of tax-cut extensions that would cost the Treasury $70 billion over the next five years. They would then turn Thursday to a $513 billion defense policy bill that would block President Bush's request to raise health-care fees and co-payments for service members and their families.

In recent days, Congress has received some good news on the budget front. A surge of tax revenues this spring, sparked by economic growth, prompted the Congressional Budget Office last Thursday to revise its 2006 deficit forecast from around $370 billion to as low as $300 billion.

But the federal debt keeps climbing because of continued deficit spending and the government's insatiable borrowing from the Social Security trust fund.

With passage of the budget, the House will have raised the federal borrowing limit by an additional $653 billion, to $9.62 trillion. It would be the fifth debt-ceiling increase in recent years, after boosts of $450 billion in 2002, a record $984 billion in 2003, $800 billion in 2004 and $653 billion in March. When Bush took office, the statutory borrowing limit stood at $5.95 trillion.

Democrats will harp on those statistics not only in the budget debate but also when the House takes up tax legislation expected to finally emerge from House-Senate negotiations today. The legislation would extend for two years the deep cuts to tax rates on dividends and capital gains that Congress approved in 2003. It would also slow for one year the expansion of the alternative minimum tax, a parallel income tax system designed to hit the affluent but increasingly pinching the middle class.

Although the debate will be rancorous, the tax measure is expected to pass by a comfortable margin. The budget vote will be closer. House leaders had to pull the budget plan from the floor in April, after moderate Republicans balked at planned cuts to health and education programs and appropriators objected to limits on home district pet projects -- known as earmarks -- and a provision that would limit emergency spending for natural disasters to about $4.3 billion a year.

Appropriators have come on board, Appropriations Committee spokesman John Scofield said. GOP leaders and committee chairman Jerry Lewis (R-Calif.) tried to win moderate support last week by cutting $4 billion from the president's defense spending request and adding that money to labor, health and education programs. But some moderates are still holding out.

"I expect they do not have the votes right now," said Rep. Michael N. Castle (R-Del.), a leader of the balking moderates. "Could they get the votes by the end of the week? I'd give it a 50-50 chance."

GOP Health-Care Redux

It's "health week" in the Senate, but don't expect any big policy cures.

Republicans are seeking to pass legislation that would restrict malpractice awards and encourage insurance pools among small businesses. The three bills are GOP perennials that in the past have met with staunch opposition by Democrats and interest groups.

Given the high stakes of the midterm election year, the prospects this week don't look any brighter. Two of the bills, both aimed at limiting medical malpractice jury awards, stalled in the Senate last night after failing to gain enough votes to overcome Democratic-led procedural hurdles.

The first measure, sponsored by Sen. John Ensign (R-Nev.), would allow up to $750,000 for non-economic damages and unlimited economic damages. A patient could recover up to $250,000 from a health-care provider and up to two health-care institutions each for a total of $750,000.

The bill also would guarantee timely resolution of claims by mandating that health-care lawsuits are filed within three years of the date of injury, establish standards for expert witnesses and limit attorneys' fees.

The second measure would target lawsuits against obstetric and gynecological providers and was sponsored by Sen. Rick Santorum (R-Pa.), whose wife won $175,000 in damages in a malpractice case against a chiropractor.

Democrats mocked the bills as a gimmick designed to rally conservative voters and appease doctors and insurance companies. "This is not a serious attempt," said Sen. Edward M. Kennedy (D-Mass.).

The third bill up this week, offered by Sen. Mike Enzi (R-Wyo.), would allow business and trade associations to band their members together and offer group health coverage on a national or regional basis. Opponents warn that it would set the "barest of bare bones standards for benefits," as one Democratic press release put it, undercutting requirements to cover cancer screening, well-baby care, immunization, access to specialists and other services.


© 2006 The Washington Post Company

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