In final action of year, Senate OKs debt ceiling hike
The short-term $290 billion increase will allow the government to do business past Jan. 1, according to the Treasury Department.
In its last vote of 2009, the Senate early last Thursday approved a short-term increase in the federal debt ceiling that the Treasury Department said is necessary to allow the federal government to do business past Jan. 1.
But, under the deal that allowed quick passage on Christmas Eve, Republicans eager to use the issue to bash Democrats over current levels of federal spending will get a chance to debate the debt ceiling issue when the Senate reconvenes next month.
The legislation passed on Dec. 24 raises the debt ceiling by $290 billion to $12.39 trillion, a step approved by the House before that chamber adjourned for the year last week. Democrats initially had hoped to pass a larger debt increase to take the issue off the table for 2010, but were forced to retreat on those plans.
The Senate action on the debt ceiling, which was approved on a 60-39 largely party-line vote, came immediately after final passage of Democrats' healthcare overhaul bill. Both were set up under the same unanimous consent agreement that ended a session that had the Senate working nearly every day since Thanksgiving, culminating in the rare Christmas Eve vote. On the debt ceiling vote, there were two defections from the otherwise partisan vote: Sen. Evan Bayh, D-Ind., one of his party's leading deficit "hawks" voted against the increase, while Sen. George Voinovich, R-Ohio, voted for it.
The deal on the debt limit allowed senators to head home while preserving Republicans' opportunity to debate the debt limit increase before President Obama's State of the Union speech next month.
Senate Democratic leaders had threatened to hold a nearly unprecedented session between Christmas and New Year's to pass the debt increase if Republicans did not agree to a quick vote.
The agreement sets up a Jan. 20 vote on a longer term debt limit expansion, which would raise the ceiling to about $13 trillion. It would include votes on several Republican amendments on that date, as well as related Democratic amendments. The amendments will need 60 votes to pass.
The most closely watched may be an amendment offered by Senate Budget Chairman Kent Conrad, D-N.D., and ranking member Judd Gregg, R-N.H., creating a special commission to recommend binding steps to reduce entitlement spending.
Another amendment to be offered by Sen. John Thune, R-S.D., would end the Troubled Asset Relief Program and require TARP money repaid by financial institutions to be used to lower the debt.
Republican senators have been pushing for a vote on a version of that amendment for months -- and claim Senate Majority Leader Harry Reid, D-Nev., previously blocked a vote out of concern that it would pass. Republicans believe that even if Democrats defeat the amendment, it will be a difficult vote for many members due to the unpopularity of the TARP program.
Budget Committee Republicans expect the debt ceiling will have to be increased again later in 2010, a politically tough step in an election year.