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Democrats' scramble to beat new deadline: Scott Brown's arrival

Senate Democrats raised the debt ceiling to $14.3 trillion and passed a pay-as-you-go measure Thursday. Both needed 60 votes. But a bid to cap federal spending exposed different fault lines.

By Staff writer / January 28, 2010

Sen. Claire McCaskill, (D-MO) and Sen. Jeff Sessions (R-AL) speak to reporters on Capitol Hill in Washington, Tuesday.

Pablo Martinez Monsivais/AP

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Washington

Senate Democrats, on a strict party-line vote, passed a joint resolution Thursday that would increase the amount of debt that Congress permits the nation to carry forward by $1.9 trillion. The federal statutory debt limit now stands at $14.29 trillion.

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The measure comes just in time. The US Treasury on course to hit the current debt limit sometime this spring.

But there was also a political deadline looming. With the swearing-in next month of Sen.-elect Scott Brown (R) of Massachusetts, Senate Democrats will lose the 60 vote majority needed to block filibusters, provided that all Democrats and two Independents vote together.

Thursday's debt-limit vote signaled how crucial those 60 votes are for the Democratic majority.

Pay-as-you-go gets go ahead

Democrats also needed all 60 votes to pass an amendment on the debt-limit bill, which makes so-called pay-as-you-go (PAYGO) rules a statutory requirement for Congress.

That means that all new tax and mandatory spending must be budget-neutral. In other words, if there is a deficit at the end of the year, the law mandates automatic spending cuts for non-exempt programs.

“Let’s not kid ourselves. We’re in this financial situation, and these pay-as-you-go rules are necessary because we spent the decade spending money we didn’t have,” said Senate majority leader Harry Reid during Thursday’s floor debate.

In response, Sen. Judd Gregg (R) of New Hampshire, the top Republican on the Senate Budget Committee, noted that a nonbinding PAYGO guideline was already in place during the past two years, and Congress waived it to the tune of $1 trillion in spending. The new amendment makes PAYGO legally binding, but Republicans aren't convinced that will make a difference.

“The idea that PAYGO is a substantive exercise around here is just politically inaccurate,” said Senator Gregg. “PAYGO is used to make a statement that you’re going to be fiscally responsible, but it doesn’t happen.”

Spending freeze shows new split

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