This article first appeared in the St. Louis Beacon, April 11, 2011 - WASHINGTON - If you thought the government shutdown debate was a nail-biter, the next big fiscal struggle in Congress promises to be even more contentious: whether to raise the nation's $14.3 trillion debt ceiling.
Perhaps more to the point, the question is whether to link such a debt-limit increase to what many Republicans demand: an enforceable limit on future federal spending.
Some are predicting another "game of chicken," with Republicans and Democrats heading at breakneck speed toward one another, waiting for the other side to swerve. Others warn of an "Armageddon-like" financial cataclysm if the ceiling is not raised and the nation reneges on its debts. Still others contend that the vote represents Congress' best chance to use the ceiling bill as a vehicle to place tight limits on future government spending.
"If we default on America's debt with this debt ceiling, it will have a dramatic negative impact on America's economy. It will spin us into a second recession," warned U.S. Sen. Dick Durbin. D-Ill., in a CNN appearance on Sunday.
But Sen. Roy Blunt, R-Mo., told the Beacon last week that "there's absolutely no reason, in my opinion, to support the debt ceiling [increase] if we're just going to continue doing what we've been doing" with excessive government spending.
Blunt and many other Republicans in Congress say they want to tie any debt-limit raise to enforceable limits on spending. One option, Blunt says, would be "statutory ceilings on how much of the GDP [gross domestic product] that the federal government could spend in a given year." Another option could be two-year appropriating, instead of the current annual system. Yet another option might be the equivalent of a balanced-budget amendment, a measure that Blunt is co-sponsoring.
Obama Wants 'Clean' Debt Bill
President Barack Obama's administration wants Congress to approve and send him a "clean" debt-ceiling bill without such riders, White House spokesman Jay Carney said Monday. But Obama's own words as a freshman U.S. senator from Illinois in 2006 are coming back to haunt him today.
"Increasing America's debt weakens us domestically and internationally," Obama argued back then, voting against then-President George W. Bush's debt-ceiling increase -- a vote that Carney said Monday that Obama now regrets. "The fact that we are here today to debate raising America's debt limit is a sign of leadership failure," Obama said in that 2006 Senate speech.
On Wednesday, Obama is expected to make an important White House speech that might address the debt-ceiling issue and offer some long-term budget-cutting proposals that aim to mollify Republicans. White House officials say Obama is expected to address possible ways to reduce the future costs of Medicaid, Medicare and other entitlement programs.
If that represents Obama's effort to drum up support for a debt-ceiling bill by convincing Republicans that he is serious about deficit reduction, there's not much time to spare. On or about May 16, the nation is expected to reach its debt limit of $14.3 trillion, although the government could take various steps to delay the actual day of reckoning until mid-summer.
Treasury Secretary Tim Geithner warned last week that if Congress fails to raise that ceiling, the government would not be able to make its debt payments. That, in turn, would lead to a default of the national debt, he said, which financial experts say would likely drive up interest rates for the government, companies and consumers.
White House spokesman Carney tried to drive home that message Monday. "The consequences ... of failing to raise the debt ceiling would be Armageddon-like in terms of the economy on -- the impact on interest rates, on job creation, on growth would be devastating," he told reporters.
Republicans Want Enforceable Riders
But House Speaker John Boehner, R-Ohio, has said that House Republicans will not vote to hike the debt limit unless Obama makes major concessions on spending coupled to it.
He reiterated that position in a Fox News interview Monday, saying that Obama "has asked us to increase the debt limit, in other words to increase the limit on the credit card, without doing anything about the source of the problem. And we've got to deal with the source of the problem."
Rep. Todd Akin, R-Town and Country, agrees that "we have to have some very strong assurances that we're going to get this budget under control. We're just not going to do again what we did the last few years, and just kept increasing the debt ceiling."
Akin, a member of the House Budget Committee, told the Beacon that "if the debt ceiling is increased -- which I think it functionally probably has to be -- there will be language on that [legislation] that really nails down the fact that we're going to get on to this overspending problem. But I don't yet know the exact nature of that language."
Akin said that the best long-term strategy might be "a constitutional amendment that would include a limitation of the size of the government and a balanced-budget amendment." However, he conceded such a constitutional amendment "would take five or six or eight years, even under good conditions, to pass through all the states" -- and such a measure "can't be hooked legislatively to the debt-ceiling bill because one is a constitutional amendment and the other is just a bill."
While Democrats would likely prefer to avoid a debt-ceiling vote, many say that they support separating that issue from other measures to make needed cuts in future spending. A spokeswoman for Sen. Claire McCaskill, D-Mo., said Monday that the senator "is deeply concerned about the deficit and debt and would welcome any opportunity to make meaningful reforms."
However, McCaskill is hesitant to directly tie the debt ceiling to other issues in the same legislation. "Failing to raise the debt ceiling would cause a financial panic that would be devastating to the economy," said McCaskill's spokeswoman, Laura Myron. "She thinks it is profoundly irresponsible to play chicken with the debt limit vote, especially to pursue divisive social issues."
In February, McCaskill was the sole Senate Democrat who sponsored a bill with several budget-conscious Republicans, including Sen. Mark Kirk, R-Ill., that would link a 10-year plan to cap all spending -- discretionary and mandatory -- to a declining percentage of the nation's gross domestic product.
'Gephardt Rule' Used to Limit Debt-ceiling Debate
One reason the debt-ceiling issue is being raised to such a fever pitch this year is that the House changed its rules in January to force a direct vote on the debt ceiling.
"We really think greater transparency is important" in debt-ceiling legislation, Akin said.
In the early 1990s, former U.S. Rep. Richard A. Gephardt -- a Democrat from St. Louis and longtime U.S. House majority and minority leader -- had negotiated a rule, House Rule XXVII, that allowed members of Congress to avoid casting a direct vote on raising the nation's debt ceiling.
The tactic aimed to head off what some regarded as "grandstanding" by conservatives who railed against the debt's size, even though the money already had been spent and refusing to raise the ceiling could have led to fiscal collapse. Under the Gephardt rule, legislation increasing the debt limit was generated automatically when the House set federal spending levels by passing a conference report on the annual budget resolution.
"We were getting double-hernias [in Congress] every time we had to do this, and I said this is insane," Gephardt recalled in an interview with the Beacon last week. "The Republicans in the House began to hate it [the debt-ceiling vote] as much as we hated it," Gephardt recalls. "I had to lobby every member of the party to get the votes."
Gephardt's rule was included in the toolboxes of the Republican-controlled House between 1995 and 2001 -- when it was revoked by Republican leaders for two years -- and then brought back by Republicans between 2003 and 2007 and kept by Democratic leaders until the GOP regained control of the House this year and killed the rule.
Noting that the debt ceiling is, in effect, an agreement to pay for bills run up in the past, Gephardt said it makes more sense to focus on the bills of the future to make spending cuts and reduce deficits.
"You were wasting so much time on something that wasn't really consequential," he said. "But you weren't spending time on the budget and appropriations and the things that really count."