Democrats next week will introduce legislation to raise the nation’s debt ceiling by as much as a staggering $1.8 trillion, a move that has put the party’s abundant spending under a spotlight and prompted a backlash from both Republicans and fiscally moderate Democrats.
The proposed increase is a “ballpark figure” that is still under discussion, according to Democratic party leaders. If used, it would raise the current $12.1 trillion debt ceiling by 15 percent.
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“This is a really big increase,” said Phillip Swagel, an economist at the American Enterprise Institute. House Democrats passed a $900 billion debt ceiling increase earlier this year, but it was never approved by the Senate.
Swagel said the new, higher amount would keep Democrats from having to vote on another increase in 2010, an election year.
“They want to take a lot of pain in one step rather than a little pain for four or five years,” Swagel said. “They will have a lot of headroom they can spend and fill up.”
House Majority Leader Steny Hoyer, D-Md., denied this, telling The Examiner, “There is no doubt the debt ceiling will have to be at that level in order to meet our financial obligations at this time next year. This is not creating new debt.”
House Speaker Nancy Pelosi said she would attach the increase to the defense spending bill, which would make it tough for Republicans to vote against it because the defense legislation contains troop funding.
Republicans are threatening to vote “no” anyway, arguing that Democrats are spending the nation into financial ruin. GOP lawmakers plan to use the opportunity to point out what they call the Democratic Party’s excessive spending, including the $787 billion stimulus.
The debt was $10.8 trillion on Day One of the Obama administration; if the proposed increase passes, the debt will have increased more than $3 trillion, almost 29 percent, since the president took office.
“Let’s stop this madness,” House Minority Leader John Boehner, R-Ohio, said Thursday.
Many Democrats are also angered by the ballooning debt, though they don’t pin the blame entirely on their own party. Senate Budget Committee Chairman Kent Conrad, D-N.D., said a dozen Democratic senators would oppose the debt ceiling unless Congress and the president established a task force to come up with debt-lowering recommendations that the House and Senate would have to vote on.
“I think we all know what happens around here,” said Sen. Evan Bayh, D-Ind., one of the dozen. “Democrats tend to want to spend more than we can afford. Republicans tend to want to cut taxes more than we can afford, and our kids pick up the bill. That is irresponsible, and it’s got to stop.”
In the House, Pelosi is negotiating with conservative Democratic Blue Dogs, who want congressional pay-as-you-go rules to accompany a debt ceiling increase.
Senate Democrats are opposed to the pay-go idea, and House Democrats don’t like Conrad’s task force proposal. The impasse could prevent a big debt ceiling increase from clearing Congress. Lawmakers would have to pass a smaller, stop-gap increase to maintain solvency at the Treasury, which will run out of money by Dec. 31.
