Claremore Daily Progress

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January 23, 2013

House extends debt limit for 4 months, Senate's OK expected

WASHINGTON D.C. — The House overwhelmingly passed a bill Wednesday to permit the government to borrow enough money to avoid a first avoid default for at least four months, defusing a crisis looming next month and setting the stage for a springtime debate over taxes, spending and the deficit.

The House passed the measure on a bipartisan 285-144 vote as majority Republicans back away from their previous demand that any increase in the government’s borrowing cap be paired with an equivalent level of spending cuts.

Senate Majority Leader Harry Reid, D-Nev., said the chamber would immediately move to advance the legislation to the White House, which has announced Obama would sign it.

The measure would suspend the $16.4 trillion cap on federal borrowing and reset it on May 19 to reflect the additional borrowing required between the date the bill becomes law and then. The amount of borrowing required depends on the tax receipts received during filing season, but over a comparable period last year the government ran deficits in the range of $150 billion.

The measure also contains a provision that slaps at the Senate, which hasn’t debated a budget since 2009, by withholding the pay for either House or Senate members if the chamber in which they serve fails to pass a budget plan. Sen. Patty Murray, D-Wash., announced Wednesday that the chamber would indeed debate a budget this year but maintained the GOP’s “no budget, no pay” move had nothing to do with the decision.

President Barack Obama vows not to negotiate over the debt ceiling as he did in the summer of 2011, though he promises further action on the budget. Wednesday’s developments mark a shift of the budget debate away from failed head-to-head talks between Obama and Boehner

The idea driving the move by GOP leaders like Speaker John Boehner, R-Ohio, is 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 congressional deficit-reduction supercommittee to reach an agreement.

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