U.S Senate Expected to Pass Debt Plan – The United States was poised to step back from the brink of economic disaster Tuesday as a bitterly fought deal to cut the budget deficit was expected to clear the Senate and President Barack Obama‘s desk.
Just hours before the Treasury’s authority to borrow funds runs out — risking a damaging U.S. debt default — the Senate was expected to approve the deal to cut the country’s bulging deficit and lift the $14.3 trillion debt ceiling enough to last beyond the November 2012 elections.
The bill cleared its biggest hurdle on Monday evening when the Republican-led House of Representatives passed the measure despite noisy opposition from both conservative Tea Party members, who wanted more spending cuts, and liberal Democrats angered by potential hits to programs for the poor.
The vote in the Democratic-controlled Senate, due to take place at noon EDT, is expected to be less dramatic. If approved, Obama would sign the bill into law shortly afterward.
The legislation pairs an increase in the government’s borrowing cap with promises of more than $2 trillion of budget cuts over the upcoming decade.
Its passage caps a long, difficult battle between tea party-powered House Republicans and Obama — with House Speaker John Boehner caught in the middle more than once.
After months of fiercely partisan struggle, the House’s top Republican and Democratic leaders swung behind the bill, ratifying a deal sealed Sunday night with a phone call from Boehner to Obama.
“I’m not happy with it,” Minority Leader Nancy Pelosi, D-Calif., said. “But I’m proud of some of the accomplishments in it. That’s why I’m voting for it.”
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Much of the measure was negotiated on terms set by Boehner, which included a demand that any increase in the nation’s borrowing cap be matched by spending cuts at least as large.
But it also meets demands made by Obama, including debt increases large enough to keep the government funded into 2013 and curbs on growth of the Pentagon budget.
Even though Obama strongly supported the measure, half of the chamber’s Democrats opposed it. Sixty-six conservative Republicans opposed the measure as well.
Still, after storming the Capital in January — only to see bill after bill die in the Democratic Senate — many junior House lawmakers opted to view the legislation through the prism of optimism.
“It’s about time that Congress come together and figure out a way to live within our means,” said Rep. Sean Duffy, R-Wis. “This bill is going to start that process, although it doesn’t go far enough.”
The measure provides an immediate $400-billion increase in the $14.3 trillion U.S. borrowing cap, with $500 billion more assured this fall. That $900 billion would be matched by cuts to agency budgets over the next 10 years.
What follows next is more complicated. The measure establishes a special bipartisan committee to draft legislation to find up to $1.5 trillion more in deficit cuts for a vote later this year. They’re likely to come from so-called mandatory programs like federal retirement benefits, farm subsidies, Medicare and Medicaid. The savings would be matched by a further increase in the borrowing cap.
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