Obama seeks restoration of pay/go provision

President Obama Tuesday called on Congress to act quickly to restore pay/go spending constraints that he credited with the surpluses of the late 1990s. While defending the record spending he pushed through to battle the recession, he said it is time to reintroduce the pay/go discipline that was pushed aside in 2002 to permit former President Bush's tax cuts to go through.

Obama was joined by House Speaker Nancy Pelosi, House Majority Leader Steny Hoyer, D-Md., and House Budget Chairman John Spratt, D-S.C., and about 40 other House members, mostly members of the Blue Dog Coalition. Sen. Claire McCaskill, D-Mo., also attended.

Hoyer said he will introduce pay/go legislation for Obama as early as next week. He said pay/go was scrapped by Republicans "because they could not afford the tax cuts" if the provision stayed in place. If the measure passes, lawmakers would have to offset most spending increases by cutting spending somewhere else.

Republicans countered that Obama's move was too late. Noting that the president has led the country "through five months of historic spending of taxpayer dollars," House Minority Whip Eric Cantor, R-Va., said, "For us to sit here and listen to the White House say 'we ought to be responsible; we ought to pay for what we are doing,' I think lacks just a little bit of credibility."

House Republican Conference Chairman Mike Pence of Indiana also was critical, saying the president's call "is going to be met with cynicism by many."

Obama presented himself as a champion of fiscal responsibility who will stick to his promise to halve the deficit in the next four years. He cast pay/go as an essential tool that proved its worth when Bill Clinton, a Democratic president, teamed with a Republican Congress on policies that led to surpluses when pay/go was in effect.

"This is a rule I championed in the Senate and called for time and again on the campaign trail," he said. "Today, with the support of these legislators ... my administration is submitting to Congress a proposal to codify this rule in law -- and I hope that the House and Senate will act quickly to pass it."

The rule, he said, is the essence of simplicity. "Congress can only spend a dollar if it saves a dollar elsewhere," he said. "It is no coincidence ... that when this rule was abandoned, we returned to record deficits that doubled the national debt."

The White House said Medicare payments to physicians, the estate tax, the alternative minimum tax, and tax cuts enacted in 2001 and 2003 would be exempt.

Billy House contributed to this report.