'Cut, Cap and Balance' Plan Set to Pass the House on Tuesday

July 18, 2011 - 3:29 AM
Tea party takes its turn in debt battle

Debt Showdown Voters

FILE - In this Feb. 11, 2011, file photo Rep. Tom Price, R-Ga., speaks at a Conservative Political Action Conference (CPAC) in Washington. “Don’t bend, stay the course, stand firm,” Price has said in summing up the feedback in July from constituents in his heavily Republican district north of Atlanta. He said calls and emails are running about 50-1 urging him not to increase taxes as part of any debt compromise. (AP Photo/Alex Brandon, File)

WASHINGTON (AP) — Congressional leaders are giving tea party-backed Republican freshmen the run of the House this week with a plan to let the government borrow another $2.4 trillion — but only after big and immediate spending cuts and adoption by Congress of a constitutional amendment requiring a balanced federal budget.

This "cut, cap and balance" plan is set to pass the House on Tuesday but is sure to stall in the Senate, where majority Democrats say it would lead to decimating budget cuts and make it harder to pass tax increases on the wealthy. And even if the scheme could pass, there's no way Congress will adopt a balanced budget amendment, which requires a two-thirds vote in both House and Senate.

But tea party lawmakers are insisting on the effort to try to put their stamp on the debate over the so-called debt limit, and GOP leaders — lacking other ideas that might win a majority in the Republican dominated House — were quick to give their OK at a spirited closed-door meeting on Friday.

Tuesday's House vote on the cut, cap and balance plan comes after more than a week of White House talks with congressional leaders failed to produce a breakthrough. The tally will be held exactly two weeks before an Aug. 2 deadline to avoid a potentially devastating default on U.S. obligations like payments to bondholders and senior citizens receiving Social Security.

"Let's let the American people decide," said Rep. Jim Jordan, R-Ohio, on "Fox News Sunday." ''Do they want something common sense as cutting spending, capping the growth in government and requiring a balanced budget amendment to the Constitution?"

After the House exercise and a failed Senate vote on a balanced budget amendment to the Constitution, Plan B appears to be to have the Senate vote to give President Barack Obama sweeping power to order increases in the debt limit totaling $2.5 trillion over the coming year without approval by lawmakers.

The hope appears to be that after trying it their way, enough House Republicans will be able to stomach the emerging Senate plan to allow it to pass, though it's plain there will have to be plenty of Democrats voting for it as well to make up for dozens of unyielding lawmakers unwilling to abandon their tea party promises.

For their part, Senate Republicans are demanding a vote this week on a balanced budget constitutional amendment, though they have zero chance of winning the required 67 votes in a chamber where they control just 47.

"No one believes there are 67 votes for any version of that," Dick Durbin of Illinois, the No. 2 Senate Democrat, said Sunday on CBS' "Face The Nation."

Public opinion polls show that voters like the idea of a balanced budget, but the government faces such massive budget gaps — it now borrows more than 40 cents of every dollar it spends — that the cuts required to eliminate the deficit were too Draconian for even the GOP-dominated House to endorse balancing the budget anytime soon. The House Republican budget still leaves deficits in the $400 billion range after 10 years.

The immediate issue is allowing the government to continue to borrow from investors and foreign countries like China to pay its bills — which include a $23 billion batch of Social Security payments set to go out the day after the default deadline.

With the deadline just over two weeks away and with a recent round of White House talks failing to generate a breakthrough, Sen. Mitch McConnell, R-Ky., the cagey leader of his party in the Senate, has proposed a plan that would allow Obama to automatically win a large enough increase in the debt to keep the government afloat until 2013 unless both House and Senate override him by veto-proof margins.

McConnell's plan has political advantages but has come under assault from many conservatives eager to take advantage of the current opportunity to use the need to lift the debt ceiling to force deficit cuts now. But Republicans refuse to consider any tax revenue increases demanded by Obama and Democrats to balance any budget package, and Democrats won't go along with significant cuts to benefits programs like Medicare and Medicaid unless tax increases on the wealthy are a part of the package.

That leaves lawmakers well short of the $2 trillion-plus in deficit cuts required to offset a debt increase that's big enough to solve the problem through next year's elections. A sense of futility has pervaded White House talks since House Speaker John Boehner, R-Ohio, abandoned hopes for a "grand bargain" with Obama a week ago Saturday, prompting McConnell to come out with his plan. Majority Leader Harry Reid, D-Nev., is on board but wants to add a plan to create yet another deficit panel, comprised entirely of lawmakers and evenly divided between the two parties, that would try to break the deadlock by the end of the year.

It's also expected that a package of spending cuts, perhaps in the $1.5 trillion range over the coming decade, would be attached to the McConnell-Reid measure, perhaps in the House.

For now, Boehner is standing behind his tea partiers. But he seems open to the McConnell idea.

"The cut, cap and balance plan that the House will vote on next week is a solid plan for moving forward," Boehner told reporters Friday. "Let's get through that vote, and then we'll make decisions about what will come after."