My Stuff

House raises debt limit to $14.3 trillion

'Pay as you go'? A better term is print as you go. As in roll the printing presses to pay the bills! National Debt, we ain't got no National Debt, we got printing presses!


House raises debt limit to $14.3 trillion

'Pay as you go' for new programs OK'd

by David Lightman - Feb. 5, 2010 12:00 AM McClatchy Newspapers

WASHINGTON - The U.S. government would be allowed to go $1.9 trillion deeper into debt under legislation approved in the House on Thursday.

The measure boosts the overall debt limit to $14.3 trillion but also includes a budget-control mechanism known as "pay as you go."

The House of Representatives voted 233-187 Thursday to approve tough new restrictions on future spending and tax cuts, but the changes are highly unlikely to reduce record federal budget deficits anytime soon. The vote for "pay as you go" will require that most new programs and tax cuts be offset by tax increases or spending reductions.

The new requirement comes with lots of exemptions, however, and it's telling that it's part of legislation to increase the nation's debt limit by $1.9 trillion, an adjustment that's necessary because budget deficits are expected to reach $1.56 trillion this fiscal year and $1.27 trillion next year.

The government will be able to borrow as much as $14.3 trillion, enough to pay its bills at least through this year. [Borrow is a politically correct term that means run the printing presses to pay the bills] Without the new limit, that authority probably would have been exhausted later this month.

House lawmakers approved the legislation increasing the debt limit on a procedural vote of 217-212.

In Arizona's House delegation, Democrats Raul Grijalva and Ed Pastor voted for the measure. Democrats Gabrielle Giffords, Ann Kirkpatrick and Harry Mitchell and Republicans Jeff Flake, Trent Franks and John Shadegg voted against it.

The bill, which the Senate passed last week, now goes to President Barack Obama for his signature.

Democrats hailed the new restrictions as historic.

"Some argue that the pay-go legislation on the floor today is too weak; but I'd point out that it brings our country more fiscal discipline than it has seen in nearly a decade," said House Majority Leader Steny Hoyer, D-Md.

Republicans scoffed.

"Yes, history is being made today. Never in the history of America has the debt been increased to $14.3 trillion," said Rep. Jeb Hensarling, R-Texas.

The pay-as-you-go plan is little more than a "political fraud," said Sen. Judd Gregg, R-N.H., because it contains exemptions for middle-class tax cuts, Medicare payments to doctors, estate-tax breaks and other politically sensitive programs.

While the change may be a baby step, "it is meaningful, because it has teeth," said Charles Konigsberg, the director of the deficit reduction task force at the Bipartisan Policy Center, an independent research group. If offsets aren't adopted, spending could be subject to automatic, across-the-board cuts.

Similar rules were in effect in the 1990s, and were credited with helping to produce budget surpluses by the end of the decade.

That dialogue, analysts said, may be the chief value of the change, because the White House and Congress now will have to think more carefully before making any new spending or tax-reduction proposals, said Robert Bixby, the director of the Concord Coalition, a budget watchdog group.

MarketWatch and the Associated Press contributed to this article.


Other Stuff