Senators Pass Debt Limit Delay
WASHINGTON – Sen. Joe Manchin was the only Democrat to vote “no” as the Senate passed legislation Thursday to permit the government to borrow hundreds of billions of dollars more to meet its obligations.
The 64-34 vote in the Democrat-controlled Senate sent House Resolution 325, the Debt Limit Bill, to President Barack Obama, who has said he will sign it. The Republican-led House passed the legislation last week, and the Senate’s move Thursday averted a first-ever government default that had loomed as early as mid-February.
The measure extends the federal debt ceiling through May 18 and requires Congress to pass a budget by April 15. Under the act, members of a chamber not passing a budget will have their pay withheld.
Twelve Senate Republicans joined Democrats in voting for the three-month debt-ceiling extension. Sens. Jay Rockefeller, D-W.Va., and Sherrod Brown, D-Ohio, voted yes, while Rob Portman, R-Ohio and, Manchin, D-W.Va., voted no.
“I cannot understand why Congress refuses to confront our financial challenges,” Manchin said. “Pretending that we aren’t accumulating more debt by the minute is irresponsible, reckless and unethical. We must deal with our out of control debt right here, right now. That is why I have voted against suspending the debt ceiling.
“Our failure to pass a budget is unacceptable to West Virginians, the American people and me,” Manchin continued. “That is why I cosponsored ‘No Budget, No Pay.’ If we are unable or unwilling to work in a bipartisan manner to pass a budget, we should not get paid. It’s as simple as that. We need to start taking responsibility for our failures. Unfortunately, the House bill combines ‘No Budget, No Pay,’ with an irresponsible provision that would allow us to continue spending recklessly for the next three months and still pay us at the end of the 113th Congress.”
The legislation would temporarily suspend the $16.4 trillion limit on federal borrowing, which experts say would allow the government to borrow about $450 billion to meet interest payments and obligations like Social Security benefits and government salaries.
The deadline for Congress to act again to prevent default would likely not come until August, according to calculations by the Bipartisan Policy Center, a Washington think tank.
Without the bill, the Treasury Department says, the government would default on its obligations by as early as mid-February.
“Failure to pass this bill will set off an unpredictable financial panic that would plunge not only the United States, but much of the world, back into recession,” said Sen. Max Baucus, D-Mont. “Every single American would feel the economic impact.”
The short-term increase in the borrowing limit was the brainchild of House Republicans, who wanted to re-sequence a series of upcoming budget battles, taking the threat of a potentially devastating government default off the table and instead setting up a clash in March over automatic across-the-board spending cuts set to strike the Pentagon and many domestic programs.
Those cuts – postponed by the recent “fiscal cliff” deal – are the punishment for the failure of a 2011 deficit supercommittee to reach an agreement. The panel was itself established by the hard-fought 2011 increase in the debt limit.
The Senate vote broke exactly opposite of the House tally last week. In the House, most Democrats and top leaders like Minority Leader Nancy Pelosi, D-Calif., opposed the legislation – which passed easily in the GOP-led chamber.
Democrats went along because the debt increase wasn’t contingent on matching cuts to the budget, as long demanded by House Speaker John Boehner, R-Ohio.
Senate Republicans offered several amendments, but all failed on party-line votes. Any amendments to the bill would have required the House to vote again.
Lawmakers have already shifted their focus to the across-the-board cuts, which would pare $85 billion from this year’s budget after being delayed from Jan. 1 until March 1 and reduced by $24 billion by the recently enacted tax bill. Defense hawks are particularly upset, saying the Pentagon cuts would devastate military readiness and cause havoc in defense contracting.
The cuts, called a “sequester” in Washington-speak, were never intended to take effect but were instead aimed at driving the two sides to a large budget bargain.