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Senate declines to block Obama debt request

Senate declines to block Obama debt request

January 27th, 2012 in News

WASHINGTON (AP) - Senate Democrats on Thursday stopped a Republican attempt to block President Barack Obama from using his authority to raise the government's borrowing cap by $1.2 trillion.

The GOP move failed on a 52-44 vote that split mostly along party lines. The vote caps an unusual process set up by Senate Minority Leader Mitch McConnell, R-Ky., to let lawmakers, mostly Republicans, vote against debt increases but not actually block them. Blocking them would provoke a first-ever, market-rattling default on U.S. obligations.

"Look, we should be working together to lower the debt, not having votes to increase it," McConnell said Thursday. "No more blank checks."

But Democratic Sen. Max Baucus of Montana said default was unthinkable and additional borrowing is needed to pay for obligations already incurred by lawmakers.

"If today's vote succeeds and causes a default, the federal government would not have funds to pay troop salaries, Social Security benefits or Medicare bills," Baucus said. "These programs would be in danger, and that would hurt the families and seniors that rely on them."

Either way, Obama's presidential veto power guarantees the increase would have gone through as intended, anyway.

The House had passed the measure last week.

Last year's debt agreement permits a total debt limit increase of $2.1 trillion in exchange for an equivalent amount in spending cuts, which would be spread out over the coming decade. The first $900 billion comes from caps on the day-to-day operations of federal agencies.

The increases were approved after a long deadlock between Democrats controlling the White House and Senate and tea party-backed Republicans dominating the House. As part of the debt pact, new "caps" on agency budgets were imposed over the coming decade to save $900 billion, and a so-called supercommittee was established with instructions to generate at least another $1.2 trillion in deficit savings.

But since the supercommittee failed to do so, automatic spending cuts to the Pentagon and a wide array of domestic programs will start next year, unless lawmakers intervene.

The national debt has skyrocketed during Obama's first term - from $10.6 trillion to $15.2 trillion today. Much of the blame lies with the deep recession Obama inherited, which made revenues plummet, but almost $1 trillion of the increase can be attributed to Obama's 2009 deficit-financed economic stimulus bill.