House sends debt limit increase, pay/go to White House

The House Thursday sent President Obama legislation to increase the debt limit by $1.9 trillion to $14.3 trillion after voting to give pay/go budget rules the force of law.

Under the rule for the measure, the House had to approve the rule -- which counted as a vote for the debt limit increase -- and then vote separately on the pay/go provision to send the package to Obama.

The House passed the rule 217-212, with all Republicans and 37 Democrats opposing.

The pay/go provision fared better and was approved 233-187, with all Republicans and 15 Democrats voting against.

Thursday's vote contrasts with House passage in July of a pay/go bill 265-166. That vote included 241 Democrats and 24 Republicans voting in favor, and 13 Democrats and 153 Republicans opposing the legislation.

Pay/go, currently a House budget rule, requires that new increases in mandatory spending and tax cuts must be offset.

House action on the package comes after the Senate last week passed the debt limit with no Republican help after attaching the pay/go provision as an amendment.

Republicans accused House Democratic leaders of trying to give their members political cover by not requiring a vote directly on the debt limit boost, a record for a one-time increase.

House Democratic leaders said the vote was structured in the easiest way to pass the package. The Treasury Department this week said Congress had until the end of the month to act before the debt limit was breached, and borrowing to run the government would be affected.

During debate on pay/go, House Majority Leader Steny Hoyer, D-Md., said the need to increase the debt limit was regrettable, but he argued that most of the deficit was the result of policies put in place when Republicans controlled Congress and the White House.

"We however, we believe America got into this mess, this Congress can begin getting America out of it," Hoyer said. "That is why Congress must pass one of the most proven deficit-cutting tools we know: statutory pay/go."

Hoyer said that statutory pay/go played a major role in producing budget surpluses in the 1990s, and should not have been allowed by Republicans to lapse in 2002.

Republicans contend Democrats want to get serious about spending only after going on a spending spree. They also charge that pay/go does nothing to rein in spending because Democrats are quick to waive it.

"What pay/go does is it lock in deficits at current levels and it doesn't address the spending crisis," said House Budget Committee ranking member Paul Ryan, R-Wis., adding that pay/go "is rife with loopholes."

Under the pay/go provision in the debt bill, four policy items are exempted from pay/go, including an unlimited exemption for extending the 2001 and 2003 tax cuts for the middle class. Patches to the alternative minimum tax and reduction of estate taxes would be exempted for two years, while providing higher Medicare payments to physicians would be exempted for five years.

Pay/go advocates say the exemptions are needed because Congress typically does not offset the items and prevents pay/go from having to be waived.

House Ways and Means Committee ranking member Dave Camp, R-Mich., appealed to his colleagues to vote against pay/go as the last chance to derail the debt limit increase.

"If this legislation fails, there is no increase in the debt limit and you cannot separate the two concepts," Camp said. "If this legislation passes, the debt limit increases by an astounding $1.9 trillion, the largest one-time increase in the debt limit ever."

Camp added, "We have heard a lot of talk recently from the president about the need to put America's fiscal house in order. However, according to the president's own budget, Congress will have to raise the debt limit again before 2011 is over."

After the vote, House Speaker Nancy Pelosi, D-Calif., thanked former President Bill Clinton during a telephone conference call for his leadership in helping restore pay/go and the fact, she said, "that we can say we've done it once, and we can do it again."

Clinton said during the same conference call with reporters: "I think this is important for our party, because it reminds people that for the last 30 years, we've had a better record on debt reform."

Clinton also urged Democrats to not be "discouraged that people don't know about it yet." He told them they "just need to get out and tell the story."

Billy House contributed to this report.