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House Passes Bill on Debt Ceiling

Monday, 01 August 2011 14:18 By Michael D Shear, Helene Cooper and Carl Hulse, New York Times News Service | News Report

Washington - The House began voting on the landmark compromise to raise the debt ceiling and sharply cut spending, after Democratic and Republican leaders in Congress made their final arguments Monday to skeptical members in both ideological wings.

With only hours left before Tuesday’s looming deadline that carries the threat of a federal default, Vice President Joseph R. Biden Jr. arrived at the Capitol on Monday for back-to-back, closed-door meetings with Democratic lawmakers in the House and Senate. Republicans in the House and Senate also huddled in advance of the votes.

The last-minute wrangling on Monday reflected the lack of enthusiasm for the debt deal as lawmakers, party activists and pundits expressed relief but little excitement for a compromise that appears to have left few partisans eagerly promoting the deal as the one they wanted.

On the Senate floor on Monday, Senator Harry Reid of Nevada, the majority leader, said: “People on the right are upset. People on the left are upset. People in the middle are upset.”

But he called it a “remarkable agreement which will protect the long-term health of our economy.”

In his first public comments since the deal was reached Sunday night, Mr. Boehner on Monday hailed the agreement for providing a path toward a balanced budget amendment to the Constitution.

"It gives us the best shot that we’ve had in the 20 years that I’ve been here to build support for a balanced budget amendment," he said.

Representative Eric Cantor of Virginia, the majority leader, said the deal is "not perfect," but said its passage will begin the process of changing the political culture in Washington.

"The big win here for us, and for the American people, is the fact that there are no tax hikes in this package," Mr. Cantor said. "The last thing we need is tax hikes."

The House moved Monday toward an afternoon vote, but it remained unclear whether the Senate would follow suit by the end of the day. Mr. Reid told his colleagues Monday afternoon that a final vote on the measure could be brought up Monday night or Tuesday.

A sense of exuberance over the weekend compromise gave way to a daylong expression of grievances.

Mr. Biden spent hours on Capitol Hill, listening and gently persuading Democrats to vote for the plan. His meeting with House members lingered far beyond its allotted time, as several representatives voiced their strong objections to what they perceived as a deal cut on the back of poor and working-class Americans, with no sacrifice by the rich in the form of tax increases.

“I wouldn’t call it anger, but we are perplexed that it has turned out like it has,” said Representative G.K. Butterfield, Democrat of North Carolina, grimacing as he left the meeting. “But we’ve run out of options and we know the consequences. I’ve heard horror stories from the Great Depression. I don’t want my fingerprints on that.”

Representative Nancy Pelosi of California, the minority leader, reminded her fellow Democrats of the consequences if the deal would collapse. She did not twist arms or deliver stern remarks, several legislators said, but rather urged them to vote their conscience.

Representative Elijah Cummings, Democrat of Maryland, said he had deep reservations about the budget compromise, declaring: “This is a hard compromise. But he added that the “ramifications would be long” if the deal did not go through.

Several Democrats said they were reserving judgment until the voting actually began, when it became clear how many votes that Democratic leaders needed to deliver. Republican leaders were embroiled in their own challenge of trying to persuade conservatives to sign onto the plan, reminding them that the deal did not include raising taxes.

Most of the leading 2012 Republican presidential candidates weighed in Monday in opposition to the debt ceiling deal, saying that it did too little to address the nation’s spending problem. Mitt Romney, the former governor of Massachusetts, said the deal “opens the door to higher taxes and puts defense cuts on the table.”

But business groups urged passage as the United States stock market initially rallied before sinking again on disappointing manufacturing news. The U.S. Chamber of Commerce said in a statement that the agreement “takes us a step in the right direction and is the right thing to do.”

Legislative leaders expressed optimism that the bill would pass in both houses. Some doubt remained about the House, amid questions about exactly how the leaders of both parties would assemble reluctant members for a majority.

The maneuvering follows an announcement late Sunday by President Obama and Congressional leaders of both parties that they had agreed to a framework for a budget deal that would cut trillions of dollars in federal spending over the next decade and clear the way for an increase in the government’s borrowing limit.

President Obama, in a hastily called appearance with reporters that ended a day of uncertainty, said that the compromise would “allow us to avoid default and end the crisis that Washington imposed on the rest of America.”

“It ensures also that we will not face this same kind of crisis again in six months, or eight months, or 12 months,” he said. “And it will begin to lift the cloud of debt and the cloud of uncertainty that hangs over our economy.”

Just before Mr. Obama spoke on television, the two Senate leaders, Mr. Reid and Mitch McConnell, Republican of Kentucky, the minority leader, took the floor to endorse the pact as well.

As the president spoke from the White House on Sunday night, Speaker John A. Boehner was on a conference call with House Republicans, trying to sell them on the proposal he had signed off on only minutes before.

Since he is likely to lose the most conservative elements of his rank and file, Mr. Boehner faces the task of framing the pact as friendly enough to Republican principles to win over a significant group of House Republicans without alienating Democrats he will need to push it over the top.

The tentative agreement calls for what the nonpartisan Congressional Budget Office estimates is at least $2.1 trillion in spending cuts over 10 years, as well as a new Congressional committee to recommend a deficit-reduction proposal by Thanksgiving, and a two-step increase in the debt ceiling.

The announcement concluded a tumultuous 24 hours that saw hopes rise Saturday night over the prospect of a deal that might have concluded the budget stalemate. By Sunday, worry set in again as lawmakers and White House officials struggled to hammer out the fine points of an agreement that must clear a Senate controlled by Democrats as well as the Republican House.

If the deal is approved, establishing a special joint committee to explore deficit reduction, it will ensure that the size and scope of the federal government and the tension between spending and taxes will remain front and center in the Washington debate headed into the 2012 election.

On the conference call, Mr. Boehner sought to portray the new agreement as one heavily tilted toward the Republican call for no new revenue, and he said it met the goal of instituting cuts greater than the amount of the debt limit increase. In a presentation, he said the pact would prevent a “job-killing default” — a warning to lawmakers that failure to raise the limit could add to the bleak employment picture.

“Our framework is now on the table that will end this crisis in a manner that meets our principles of smaller government,” Mr. Boehner said. Participants on the call, which lasted about an hour, said that the tone was cordial and that lawmakers expressed less resistance than had been anticipated.

At the same time, Representative Nancy Pelosi of California, the former speaker and current Democratic leader, was noncommittal about the plan, suggesting that Democrats might not rally behind it. “I look forward to reviewing the legislation with my caucus to see what level of support we can provide,” she said in a statement.

Senior White House officials said they were hopeful that Congressional leaders from both sides would manage to sell the deal to their parties. While “there are some Democrats who simply don’t believe in the necessity of deficit reduction,” one administration official said, “most do. I think it’s important as a party to show Americans that we’re serious about deficit reduction.”

The Senate seemed an easier sell. Senator Mike Johanns, Republican of Nebraska, said that from the terms of the deal described to him, “I think I will be satisfied and supportive.” After years of work, he noted, Congress has become “serious about cuts in spending.”

As conversations flowed between the White House and Capitol Hill early Sunday, Mr. Reid publicly embraced the compromise that would tie deep spending cuts to a debt ceiling increase even though some Democrats believed the White House has given too much ground to Mr. McConnell and Mr. Boehner.

While lawmakers awaited word of an agreement, talks dragged on. Congressional and administration officials attributed the delay to efforts by Mr. Boehner, Republican of Ohio, to limit immediate reductions in the Pentagon budget and better protect it from future cuts in order to cement votes from defense hawks. He needs those votes to win approval of the plan in the House.

Officials said that Mr. Boehner ultimately did not gain much and that the dispute was settled through an agreement to expand the definition of “security-related” spending to include departments beyond the Pentagon, spreading out potential cuts to the Department of Homeland Security and other agencies.

The tense, last-minute negotiations were taking place against a backdrop of uncertainty, with a looming threat of a costly downgrade of the nation’s credit rating and with investors worried about the global economic impact of a possible default. The political stakes were unusually high as well, with leaders in both parties staking out positions that may well be central to their re-election chances in 2012.

Referring to the torturous negotiations, Senator Dianne Feinstein, Democrat of California, said: “Sausage making is not pretty. But the sausage we have, I think, is a very different sausage from when we started.”

In the end, few legislators were pleased. “It may be the best we can do,” said Senator Jeff Sessions of Alabama, the senior Republican on the Budget Committee. “But I do not think it’s enough.”

With the talks appearing to make progress, the Senate blocked a Democratic proposal for a debt limit increase on a vote of 50-to-49, falling 10 votes short of the 60 required to limit debate. The plan that ultimately won the support of Congressional leaders was described by officials briefed on its outline. They said the debt limit would be increased by $900 billion in the first installment, subject to a Congressional vote of disapproval that Mr. Obama would be able to veto. To prevent a default, $400 billion would be added immediately.

A second increase of $1.2 trillion to $1.5 trillion would be available subject to a second vote of disapproval by Congress. At the same time, a new joint Congressional committee would be created to find cuts roughly matching the increase in the debt limit.

If the evenly divided committee failed to agree on a plan, Congress would either have to approve a balanced budget agreement to the Constitution or accept an across-the-board cut in spending in line with the committee’s goal, with 50 percent of the savings coming from the Pentagon beginning in 2013. Medicare would also sustain cuts, though the reductions would be capped; Social Security and other programs would be exempt.

The rationale for picking favored programs like the Pentagon for Republicans and Medicare for Democrats was to provide a strong incentive for the new committee to avoid a deadlock and deliver a deficit reduction plan that could clear Congress.

Helene Cooper

Helene Cooper is a Liberian-born American journalist who is a White House correspondent for the New York Times. Before that, she was the paper's diplomatic correspondent in Washington, D.C.. She joined the Times in 2004 as assistant editorial page editor.


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House Passes Bill on Debt Ceiling

Monday, 01 August 2011 14:18 By Michael D Shear, Helene Cooper and Carl Hulse, New York Times News Service | News Report

Washington - The House began voting on the landmark compromise to raise the debt ceiling and sharply cut spending, after Democratic and Republican leaders in Congress made their final arguments Monday to skeptical members in both ideological wings.

With only hours left before Tuesday’s looming deadline that carries the threat of a federal default, Vice President Joseph R. Biden Jr. arrived at the Capitol on Monday for back-to-back, closed-door meetings with Democratic lawmakers in the House and Senate. Republicans in the House and Senate also huddled in advance of the votes.

The last-minute wrangling on Monday reflected the lack of enthusiasm for the debt deal as lawmakers, party activists and pundits expressed relief but little excitement for a compromise that appears to have left few partisans eagerly promoting the deal as the one they wanted.

On the Senate floor on Monday, Senator Harry Reid of Nevada, the majority leader, said: “People on the right are upset. People on the left are upset. People in the middle are upset.”

But he called it a “remarkable agreement which will protect the long-term health of our economy.”

In his first public comments since the deal was reached Sunday night, Mr. Boehner on Monday hailed the agreement for providing a path toward a balanced budget amendment to the Constitution.

"It gives us the best shot that we’ve had in the 20 years that I’ve been here to build support for a balanced budget amendment," he said.

Representative Eric Cantor of Virginia, the majority leader, said the deal is "not perfect," but said its passage will begin the process of changing the political culture in Washington.

"The big win here for us, and for the American people, is the fact that there are no tax hikes in this package," Mr. Cantor said. "The last thing we need is tax hikes."

The House moved Monday toward an afternoon vote, but it remained unclear whether the Senate would follow suit by the end of the day. Mr. Reid told his colleagues Monday afternoon that a final vote on the measure could be brought up Monday night or Tuesday.

A sense of exuberance over the weekend compromise gave way to a daylong expression of grievances.

Mr. Biden spent hours on Capitol Hill, listening and gently persuading Democrats to vote for the plan. His meeting with House members lingered far beyond its allotted time, as several representatives voiced their strong objections to what they perceived as a deal cut on the back of poor and working-class Americans, with no sacrifice by the rich in the form of tax increases.

“I wouldn’t call it anger, but we are perplexed that it has turned out like it has,” said Representative G.K. Butterfield, Democrat of North Carolina, grimacing as he left the meeting. “But we’ve run out of options and we know the consequences. I’ve heard horror stories from the Great Depression. I don’t want my fingerprints on that.”

Representative Nancy Pelosi of California, the minority leader, reminded her fellow Democrats of the consequences if the deal would collapse. She did not twist arms or deliver stern remarks, several legislators said, but rather urged them to vote their conscience.

Representative Elijah Cummings, Democrat of Maryland, said he had deep reservations about the budget compromise, declaring: “This is a hard compromise. But he added that the “ramifications would be long” if the deal did not go through.

Several Democrats said they were reserving judgment until the voting actually began, when it became clear how many votes that Democratic leaders needed to deliver. Republican leaders were embroiled in their own challenge of trying to persuade conservatives to sign onto the plan, reminding them that the deal did not include raising taxes.

Most of the leading 2012 Republican presidential candidates weighed in Monday in opposition to the debt ceiling deal, saying that it did too little to address the nation’s spending problem. Mitt Romney, the former governor of Massachusetts, said the deal “opens the door to higher taxes and puts defense cuts on the table.”

But business groups urged passage as the United States stock market initially rallied before sinking again on disappointing manufacturing news. The U.S. Chamber of Commerce said in a statement that the agreement “takes us a step in the right direction and is the right thing to do.”

Legislative leaders expressed optimism that the bill would pass in both houses. Some doubt remained about the House, amid questions about exactly how the leaders of both parties would assemble reluctant members for a majority.

The maneuvering follows an announcement late Sunday by President Obama and Congressional leaders of both parties that they had agreed to a framework for a budget deal that would cut trillions of dollars in federal spending over the next decade and clear the way for an increase in the government’s borrowing limit.

President Obama, in a hastily called appearance with reporters that ended a day of uncertainty, said that the compromise would “allow us to avoid default and end the crisis that Washington imposed on the rest of America.”

“It ensures also that we will not face this same kind of crisis again in six months, or eight months, or 12 months,” he said. “And it will begin to lift the cloud of debt and the cloud of uncertainty that hangs over our economy.”

Just before Mr. Obama spoke on television, the two Senate leaders, Mr. Reid and Mitch McConnell, Republican of Kentucky, the minority leader, took the floor to endorse the pact as well.

As the president spoke from the White House on Sunday night, Speaker John A. Boehner was on a conference call with House Republicans, trying to sell them on the proposal he had signed off on only minutes before.

Since he is likely to lose the most conservative elements of his rank and file, Mr. Boehner faces the task of framing the pact as friendly enough to Republican principles to win over a significant group of House Republicans without alienating Democrats he will need to push it over the top.

The tentative agreement calls for what the nonpartisan Congressional Budget Office estimates is at least $2.1 trillion in spending cuts over 10 years, as well as a new Congressional committee to recommend a deficit-reduction proposal by Thanksgiving, and a two-step increase in the debt ceiling.

The announcement concluded a tumultuous 24 hours that saw hopes rise Saturday night over the prospect of a deal that might have concluded the budget stalemate. By Sunday, worry set in again as lawmakers and White House officials struggled to hammer out the fine points of an agreement that must clear a Senate controlled by Democrats as well as the Republican House.

If the deal is approved, establishing a special joint committee to explore deficit reduction, it will ensure that the size and scope of the federal government and the tension between spending and taxes will remain front and center in the Washington debate headed into the 2012 election.

On the conference call, Mr. Boehner sought to portray the new agreement as one heavily tilted toward the Republican call for no new revenue, and he said it met the goal of instituting cuts greater than the amount of the debt limit increase. In a presentation, he said the pact would prevent a “job-killing default” — a warning to lawmakers that failure to raise the limit could add to the bleak employment picture.

“Our framework is now on the table that will end this crisis in a manner that meets our principles of smaller government,” Mr. Boehner said. Participants on the call, which lasted about an hour, said that the tone was cordial and that lawmakers expressed less resistance than had been anticipated.

At the same time, Representative Nancy Pelosi of California, the former speaker and current Democratic leader, was noncommittal about the plan, suggesting that Democrats might not rally behind it. “I look forward to reviewing the legislation with my caucus to see what level of support we can provide,” she said in a statement.

Senior White House officials said they were hopeful that Congressional leaders from both sides would manage to sell the deal to their parties. While “there are some Democrats who simply don’t believe in the necessity of deficit reduction,” one administration official said, “most do. I think it’s important as a party to show Americans that we’re serious about deficit reduction.”

The Senate seemed an easier sell. Senator Mike Johanns, Republican of Nebraska, said that from the terms of the deal described to him, “I think I will be satisfied and supportive.” After years of work, he noted, Congress has become “serious about cuts in spending.”

As conversations flowed between the White House and Capitol Hill early Sunday, Mr. Reid publicly embraced the compromise that would tie deep spending cuts to a debt ceiling increase even though some Democrats believed the White House has given too much ground to Mr. McConnell and Mr. Boehner.

While lawmakers awaited word of an agreement, talks dragged on. Congressional and administration officials attributed the delay to efforts by Mr. Boehner, Republican of Ohio, to limit immediate reductions in the Pentagon budget and better protect it from future cuts in order to cement votes from defense hawks. He needs those votes to win approval of the plan in the House.

Officials said that Mr. Boehner ultimately did not gain much and that the dispute was settled through an agreement to expand the definition of “security-related” spending to include departments beyond the Pentagon, spreading out potential cuts to the Department of Homeland Security and other agencies.

The tense, last-minute negotiations were taking place against a backdrop of uncertainty, with a looming threat of a costly downgrade of the nation’s credit rating and with investors worried about the global economic impact of a possible default. The political stakes were unusually high as well, with leaders in both parties staking out positions that may well be central to their re-election chances in 2012.

Referring to the torturous negotiations, Senator Dianne Feinstein, Democrat of California, said: “Sausage making is not pretty. But the sausage we have, I think, is a very different sausage from when we started.”

In the end, few legislators were pleased. “It may be the best we can do,” said Senator Jeff Sessions of Alabama, the senior Republican on the Budget Committee. “But I do not think it’s enough.”

With the talks appearing to make progress, the Senate blocked a Democratic proposal for a debt limit increase on a vote of 50-to-49, falling 10 votes short of the 60 required to limit debate. The plan that ultimately won the support of Congressional leaders was described by officials briefed on its outline. They said the debt limit would be increased by $900 billion in the first installment, subject to a Congressional vote of disapproval that Mr. Obama would be able to veto. To prevent a default, $400 billion would be added immediately.

A second increase of $1.2 trillion to $1.5 trillion would be available subject to a second vote of disapproval by Congress. At the same time, a new joint Congressional committee would be created to find cuts roughly matching the increase in the debt limit.

If the evenly divided committee failed to agree on a plan, Congress would either have to approve a balanced budget agreement to the Constitution or accept an across-the-board cut in spending in line with the committee’s goal, with 50 percent of the savings coming from the Pentagon beginning in 2013. Medicare would also sustain cuts, though the reductions would be capped; Social Security and other programs would be exempt.

The rationale for picking favored programs like the Pentagon for Republicans and Medicare for Democrats was to provide a strong incentive for the new committee to avoid a deadlock and deliver a deficit reduction plan that could clear Congress.

Helene Cooper

Helene Cooper is a Liberian-born American journalist who is a White House correspondent for the New York Times. Before that, she was the paper's diplomatic correspondent in Washington, D.C.. She joined the Times in 2004 as assistant editorial page editor.


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