UPDATED: 7:43 on Friday, July 29, 2011
WASHINGTON (AP) - The Senate has just killed the latest effort by the House to raise the government's borrowing cap. Democrats and several Republicans defeated the GOP measure Friday night by a 59-41
vote, just minutes after it arrived from the House. Democrats oppose the measure because it would require another painful debt-limit debate early next year.
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(CBS) -- By Brian Montopoli
House Republicans narrowly passed an altered version of their plan to raise the debt limit late Friday afternoon, though Senate Democrats were poised to immediately kill the legislation.
The bill passed 218 to 210, with the support of no Democrats. 22 Republicans voted against the bill. Republicans needed 216 votes for passage.
House Speaker John Boehner was able to win over skeptical fiscal conservatives by requiring that a second debt ceiling increase roughly six months from now be tied to successfully sending a Balanced Budget Amendment to the states - something that would require a two thirds majority in both the House and the Senate. Boehner had to cancel a planned vote on the measure last night because he did not have the votes for passage.
The bill will now go to the Senate, where Democrats have vowed to vote it down. They plan to move forward on an alternate plan that would cut around $2 trillion in spending and extend the nation's borrowing authority through 2012.
Democrats say the House GOP plan, which would reduce spending by more than $900 billion over ten years, is unacceptable because it would initially only increase the debt limit for about six months, creating economic uncertainty, putting the United States' Triple-A credit rating at risk and requiring the debate again during the holiday season.
Boehner took to the Senate floor Friday afternoon shortly before the vote, saying he has "worked since the first week of this session... to avoid being where we are right this moment."
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Boehner said he "stuck my neck out a mile to try to get an agreement with the President of the United States," but that "a lot of people in this town can never say yes." To cheers from his caucus, he called on Democrats and the White House to "end this crisis now."
There is virtually no chance that a Balanced Budget Amendment could get the two-thirds majority necessary for passage in both chambers. (To go into effect, it would also need to be ratified by three-fourths of the states.) If Congress ends up passing some sort of compromise legislation between the Senate and House plans, the Balanced Budget Amendment will almost surely be stripped out.
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President Obama on Friday morning urged lawmakers to come to a bipartisan solution to reach a deal to increase the nation's $14.3 trillion debt limit before Tuesday's deadline.
"The time for putting party first is over. The time for compromise on behalf of the American people is now," Mr. Obama said. "And I'm confident that we can solve this problem."
The addition of the Balanced Budget Amendment provision actually moves the House plan further to the right. But it appears to be the only way for Boehner and his leadership team to save face and pass a Republican version of a bill to raise the debt ceiling in the last days before the deadline is reached.
Mr. Obama dismissed the Republican plan Friday, saying it "has no chance of becoming law." He urged lawmakers to take up a plan from Senate Majority Leader Harry Reid or a plan put forward earlier by Senate Republican leader Mitch McConnell as the basis for a bipartisan agreement.
Reid's plan makes similar cuts to the first step of the Boehner plan, but it also includes about $1 trillion in savings tied to ending the wars in Iraq and Afghanistan -- something the United States is already planning to do. Republicans say the Reid plan is grounded in accounting tricks and doesn't do enough to address the nation's massive deficit and debt problem.
Mr. Obama warned Friday morning that if an agreement isn't reached, the U.S. may lose its Triple-A credit rating "not because we didn't have the capacity to pay our bills -- we do. But because we didn't have a triple-A political system to match our triple-A credit rating."
If the United States' credit rating were downgraded, it would be harder to borrow money, and interest rates would potentially increase across the board. "That's inexcusable," Mr. Obama said. "There are a lot of crises in the world we can't always predict or avoid... This isn't one of those crises."
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