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Senate Leaders Await Fate of House Debt Deal

Senate Democrats are positioned to be the last ones with control over the legislative vehicle that could avert a default on the nation’s debt, as uncertainty hangs today over Speaker John Boehner’s
(R-Ohio) ability to pass his own bill through the House.

The ambiguity of the situation, however, had Senators casting about for ways to make sure they are not left shouldering the blame for a default and the serious economic consequences projected by the markets, ratings agencies and top economic officials.

“I had this feeling like this was going to be like this game [of] ‘hot potato’ … and whoever was left holding the hot potato when we get to next Monday was going to have to eat it because the alternative would be default and disaster for our economy. So watch the hot potato and see if it moves,” Sen. Joe Lieberman (I-Conn.) said Tuesday.

Since Sunday, the House and the Senate have been on dueling tracks to raise the debt limit by the Aug. 2 deadline, when the Treasury Department says the U.S. will run out of money to service the debt and keep the government operating. The two paths Republican and Democratic leaders are pursuing, though, are more similar than they are different, and they appear to be on a course to collide with each other late this week as lawmakers rush to devise a final compromise.

On Tuesday, both parties and chambers continued their posturing, with Senate Majority Leader Harry Reid (D-Nev.) saying Boehner’s plan was “dead on arrival in the Senate” and Minority Leader Mitch McConnell (R-Ky.) saying Reid’s offering “should be defeated.” But McConnell refused to say outright whether his Conference would band together to filibuster the Reid plan. Plus, Republicans asserted that the White House only issued a recommendation to veto the Boehner proposal, not a flat-out veto threat.

“There are two key parts of both the Boehner and the Reid proposals that are exactly the same — $1.2 trillion in real cuts and spending and this very important committee that can open the door to revenue reform and entitlement reform,” Lieberman, who caucuses with Democrats, said. He noted that neither plan right now has the votes to clear the Senate.

The Boehner and Reid proposals include about $1 trillion in discretionary spending savings, though the Senate framework includes military cuts. And both measures also establish a 12-Member bipartisan joint committee that would be charged with producing a plan to cut at least $1.8 trillion more. As of Tuesday, the main sticking point remains the length of the debt limit extension, with Democrats demanding the ceiling be lifted until 2013 and Republicans wanting a two-step process.

Despite the overlap, the Senate was in a holding pattern while awaiting a House vote on the Boehner framework. The measure had been scheduled to come to the House floor Wednesday, but a spokeswoman for House Majority Leader Eric Cantor (R-Va.) announced late Tuesday that the vote would be postponed by a day while Republicans reworked the legislation. A Congressional Budget Office score released Tuesday evening showed that the bill would cut just $1 billion from the deficit next year, sending Republicans scrambling to find more savings to ensure that the bill’s spending cuts exceed its $1 trillion debt limit increase.

If the Speaker’s bill fails, the Senate will have the only active bill in the procedural pipeline. If Boehner’s plan passes, Reid can quickly dispatch it to the floor and defeat it, setting the table for a possible final compromise between the leaders, aides have indicated.

But the clock is ticking, and neither chamber has much time to waste on legislation that has no chance of ending up on President Barack Obama’s desk next week.  

Complicating the picture for an endgame, especially one pinned to the House offering, was the negative reaction Tuesday to the Boehner plan from both tea party conservatives and establishment rank-and-file GOP Senators.

Sen. Lindsey Graham (R-S.C.), who has not shied away from bipartisan compromise in the past, slammed the Boehner plan in a statement. “I cannot in good conscience support the Boehner proposal in its current construct. The Boehner proposal, no matter how well-intentioned, will be a straight-jacket on real spending reform,” Graham said. “It locks in spending levels well beyond what our nation can afford. … I also have little hope that yet another joint committee of Congress will bring about real change.”

Of the potential stumbling blocks left, the most serious seem to be the length of the debt limit extension and conservative Senators, who have the power to delay for days any bill, even one that has the support of a filibuster-proof majority.

Sen. Rand Paul, one of the tea party’s top champions in the Senate, talked Tuesday of potentially filibustering any plan — Reid’s, Boehner’s or otherwise.

“We haven’t made a final decision on that,” Paul said of a filibuster. “A lot of us will get together and talk and see. There are several of us who will come out against the Boehner plan.” Asked whether he might bow to pressure from his own leaders if they asked him to forgo a filibuster, the Kentucky Republican said, “I don’t ever really feel pressure because I think they know I’m going to do what I said I would do in the campaign. I’m not really open to being persuaded about things that will not lead to any reform.”

Meanwhile, leaders say they continue to keep open channels of communication as Congress presses on its deadline and Senators in both parties recognize the need to tweak whichever legislative vehicle comes before the chamber. One of the most significant differences between the two bills is that Boehner’s has a huge incentive — the threat of default — for lawmakers to act if the bipartisan committee it creates deadlocks on a deficit reduction package. There are no triggers if Reid’s similar joint committee fails to reach a deal, but Democrats and Republicans said Tuesday that real consequences could be added to attract Republicans.

“That might be one point of compromise,” Sen. Rob Portman (R-Ohio) said. Portman noted that the Senate’s bipartisan “gang of six” proposal included a trigger that would allow 10 Senators — five from each party — to get a Senate floor vote on a deficit reduction plan if committees failed to produce savings.

“There are various ways to do it,” he said, adding that both plans aren’t very different and the desire of both parties to avoid default should bring them together.

“At the end of the day, the alternatives are pretty unpleasant,” Portman said.

Sen. Saxby Chambliss (R-Ga.), a member of the gang of six, said he floated the idea of using that group’s triggers to both Reid and McConnell over the weekend,  but neither has supported it yet.

“It’s in their lap,” he said. “If you have a 6-6 deadlock in this select committee, where are we going? Right now, the plan is, is just do nothing. … I don’t think that’s good. Something’s got to happen.”

Sen. John Thune (R-S.D.) also said the triggers for the joint committee are key.

“It comes down to the enforcement of it, and if you’re deadlocked, what kind of triggers do you use,” he said.

Reid, however, called the 10-Senator trigger “a little weak.”

Editor’s Note:

This article updates the print version to include details on a voting delay for Speaker John Boehner’s deficit bill to allow for changes to the measure.

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