Democrats queasy about deficit spending

By Lori Montgomery
Washington Post Staff Writer
Wednesday, May 19, 2010

With voters up in arms over the mounting federal debt, congressional Democrats are growing increasingly queasy about adding to the nation's tab, with some arguing that additional spending to prop up the economy and help the unemployed should be paid for or abandoned.

"This is getting to be Judgment Day on the spending issue," Sen. Ron Wyden (D-Ore.) said Tuesday. "I've come to the conclusion that voters are saying now that just throwing money at various kinds of issues -- virtually all of which are deserving -- isn't good enough."

Wyden spoke after emerging from a meeting where Senate Democrats discussed two must-pass spending packages that Majority Leader Harry M. Reid (D-Nev.) has vowed to bring to a vote before the Memorial Day recess. The larger measure would extend a variety of expired tax cuts, unemployment benefits and aid to cash-strapped state governments while preventing a big pay cut from taking effect at the end of the month for doctors who see Medicare patients. The other would finance additional troops for the war in Afghanistan and provide more money for disaster relief.

Together, the two measures are expected to cost more than $250 billion, aides said, much of it financed with borrowed funds. Meanwhile, the Obama administration and some liberal Democrats are urging lawmakers to throw in an additional $23 billion to help state education officials prevent the layoffs of as many as 300,000 public school teachers, a grim possibility that would crowd classrooms nationwide while adding to the swollen ranks of the unemployed.

Few Democrats argue that the money is not needed. But with this year's budget deficit already forecast to break a record, and Republicans accusing Democrats of rampant overspending in advance of this fall's midterm elections, many lawmakers are reexamining their priorities and asking their leaders to come up with a plan to cover the cost.

"There is a mounting list of actions to be taken where we're incurring more debt or we're increasing the deficit. . . . And it's becoming not only a fiscal problem, but also a political problem," said Sen. Robert P. Casey Jr. (D-Pa.). Casey spent the weekend campaigning in southwestern Pennsylvania with Democrat Mark Critz, who won a special election Tuesday night to replace the late John P. Murtha (D).

"People will no longer accept the idea that we're trying to solve big problems and we've just got to keep going into debt to do it," Casey said. "They're not going to buy that anymore."

As lawmakers debated the two spending measures, fear of a political backlash over the deficit also appeared closer to derailing any effort to approve a budget blueprint this year. With Democrats from conservative districts unwilling to ratify a spending plan that includes huge annual budget gaps, Senate Budget Committee Chairman Kent Conrad (D-N.D.) said Tuesday that hopes for passing a full budget resolution in both the House and Senate were "fading." Conrad said he might try to win approval for annual spending caps that would limit the amount appropriators could devote to discretionary programs.

"This is an extremely challenging time because what makes perfect sense in the longer run makes much less sense in the short run," Conrad said, noting that any effort to quickly cut the deficit runs the risk of snuffing out a still-shaky economic recovery. "That sounds like Washington double-talk to people. Unfortunately, it happens to be the reality of how you deal with an economic downturn."

Talks continued Tuesday between House and Senate leaders over the shape of the larger spending package, which House leaders hope to bring to the floor later this week and send to the Senate for final approval. Democratic aides said they had identified only about $50 billion in tax increases and other offsets for the package, which is expected to cost in excess of $200 billion. That would include an $88.5 billion plan to protect doctors from scheduled Medicare cuts over the next five years -- a proposal some lawmakers in both parties say they will oppose if it increases the deficit.

In the Senate, where Democrats need the support of at least one Republican to avoid a GOP filibuster, aides said Senate Republicans were united in opposition to any measure that would add $150 billion to the budget deficit. But many Republicans are also opposed to the tax increases that Democrats are considering to help finance the package, including higher taxes on income earned by investment fund managers.

To avoid a replay of recent floor fights that have cast Republicans as the enemy of the unemployed, Republicans are working on a proposal to pay for part of the package with spending cuts. John Hart, a spokesman for Sen. Tom Coburn (R-Okla.), said his boss plans to offer "an extensive list of amendments" to both spending measures that would trim "at least $100 billion" from federal spending.

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