Senate Democrats face hurdles getting votes to increase nation's debt limit
Thursday, January 21, 2010
Senate Democrats proposed Wednesday to increase the nation's debt limit by a record $1.9 trillion, but were scrambling to line up the votes for the increase, which would authorize the Treasury to borrow enough money to cover the government's bills through the rest of the year.
The proposed increase would raise the legal cap on borrowing to $14.3 trillion, which would increase the nation's accumulated debt to about the size of the overall U.S. economy.
The current debt limit is $12.4 trillion, a level the Treasury Department expects to exceed as soon as next month. The debt has been rising rapidly as the government has devoted massive sums to combating the deepest recession in a generation.
Faced with growing public concern over the debt and President Obama's stewardship of the economy, Democrats are aiming to set the cap high enough to see them through this fall's congressional elections. As debate opened Wednesday, Senate Finance Committee Chairman Max Baucus (D-Mont.) argued that a significant increase is the right thing to do.
"We have gone to the restaurant. We have eaten the meal. Now the only question is whether we will pay the check," Baucus said.
The White House issued a statement calling the debt increase "critically important to make sure that financing of federal government operations can continue without interruption and that the creditworthiness of the United States is not called into question."
Republicans have vowed to oppose the increase, and to turn what is usually a routine procedural vote into a public indictment of Democratic fiscal policy. After winning a crucial 41st Senate seat in Massachusetts on Tuesday, a unified GOP caucus could block the increase and insist on a short-term hike that would force Democrats to repeatedly revisit the unpopular topic.
"The reason we're being asked to raise the limit on the national credit card is clear: It's because the majority has spent the past year spending money we don't have on stimulus bills that don't stimulate the economy, on budgets that double the debt in five years and triple it in 10," said Senate Minority Leader Mitch McConnell (R-Ky.). "We need to move in a new direction . . . That's the message of Massachusetts."
Democratic efforts to raise the cap have been further complicated by dissension in their own ranks. On Tuesday, the White House and congressional Democrats reached a tentative agreement to have Obama appoint a bipartisan budget commission to chart a path to fiscal solvency, an agreement designed to appease more than a dozen moderate Democrats in the Senate, who are otherwise threatening to vote against the debt limit increase.
But that deal has yet to be sealed. The leader of the moderate faction, Senate Budget Committee Chairman Kent Conrad (D-N.D.), said he was still waiting for written assurances that Congress would give the commission's recommendations an up or down vote by the end of this year. "Without a credible commission, there's not going to be a vote on a long-term extension of the debt," Conrad said.
Some congressional Republicans, meanwhile, said they would refuse to participate in a commission appointed by the president, calling it political cover for Democrats who want to appear as though they're taking action to rein in skyrocketing budget deficits.
"I wouldn't serve on it and I would strongly recommend to my leadership that they not put people on it," said Sen. Judd Gregg (R-N.H.), who with Conrad has pressed lawmakers to establish a budget commission by law, which would have broader powers to force action on a deficit-reduction plan. "It's a nothing-burger."