WASHINGTON -- The Senate last week halted debate on a House-approved bill proposed by Republicans to avert looming financial default by the federal government.
The Senate voted 51-46 along party lines to table the "cut, cap and balance" bill, effectively ending further action on it.
The plan called for steep cuts in federal spending, caps on future spending, and advancement of a constitutional amendment to require a balanced budget. In return, President Barack Obama would be permitted to increase the government's borrowing power above the current $14.3 trillion limit in order to continue paying bills.
Congress needs to raise the federal debt ceiling by Aug. 2 to avoid a potential default that U.S. Chamber of Commerce lobbyist Bruce Josten says would have "real, immediate, and potentially catastrophic consequences."
Senate Minority Leader Mitch McConnell, R-Ky., said during debate on the bill that it was an opportunity to set a responsible course for future federal spending.
"It's an opportunity to say that a government which borrows more than 40 cents for every dollar it spends is not sustainable, and needs to change its ways," McConnell said. "It's an opportunity to stand with those who believe that Washington needs to heal its addiction to spending now."
Democrats opposed the proposed balanced budget amendment because it would cap spending at 18 percent of gross domestic product. Senate Budget Committee Chairman Kent Conrad, D-N.D., said such a limit would leave no room for Medicare or Medicaid.
"If they hold harmless Social Security, defense and other non-health spending, and of course we have got to pay interest on the debt, there is nothing left over," he said. "There is no money for Medicare. There is no money for Medicaid."
Democrats also objected to another provision that would require a two-thirds majority of Congress to approve any revenue increases while spending cuts could be made by a simple majority.
Senate Majority leader Harry Reid, D-Nev., called for tabling the bill to demonstrate that Democrats would not accept a deficit-reduction plan that relies on spending cuts alone.
Reid voted to table the bill. Sen. Dean Heller, R-Nev., voted in favor of the bill.
The Republican-controlled House approved the "cut, cap and balance" bill earlier in the week, by a mostly party-line vote of 234-190. Only five Democrats voted for it, while nine Republicans voted against it.
Rep. Joe Heck, R-Nev., voted for the bill. Rep. Shelley Berkley voted against it.
House takes aim at 'financial czar'
The House voted 241-173 to weaken the power of a new agency designed to protect consumers in the financial marketplace.
The bill, backed largely by Republicans, would replace a single director for the Consumer Financial Protection Bureau with a five-member commission and place its budget under congressional oversight.
House Financial Services Committee Chairman Spencer Bachus, R-Ala., said it is unacceptable to have an "unaccountable czar" with the power to regulate every financial product and service in the marketplace.
"That sounds to me like a government command-and-control economy," he said.
Democrats claimed that the bill was part of a yearlong effort by Republicans to undermine sweeping financial regulatory reforms Congress adopted last year.
"We are still feeling the effects of a crisis that largely came about because the referees who oversee the soundness of our financial system were not on the field," said Rep. Steny Hoyer, D-Md. "But while Democrats have worked to restore proper oversight to Wall Street, Republicans want the referees off the field again, and that would put us all at risk."
Heck voted for the bill. Berkley opposed it.
Contact Stephens Washington Bureau reporter Peter Urban at firstname.lastname@example.org or at 202-783-1760.