Welch votes against debt ceiling plan; bill authorizes “Ryan team” to make cuts

Congressman Peter Welch. VTD/Taylor Dobbs

Congressman Peter Welch. VTD/Taylor Dobbs

The House of Representatives endorsed a debt-reduction agreement on Monday, hours before the debt ceiling limit was set to expire on Tuesday, Aug. 1. The Budget Control Act Amendment of 2011 passed on a vote of 269 to 161.

The last-ditch deal, which the Senate is expected to approve today, prevents the nation from defaulting, but does little else, according to the Los Angeles Times. Politically, each faction gets a partial victory in the face of $2.1 trillion in cuts phased in over time: the GOP protects high-income Americans from paying more in taxes; Democrats are assured Social Security won’t be cut; and President Barack Obama won’t face another debt-ceiling debacle before the next election (though the budget battle is next). The loser is the nation’s economy, according to the LA Times.

Under the plan, the federal government will cut $21 billion from its $3.7 trillion budget in 2012. Most of the $2.1 trillion in cuts, to be meted out over the course of a decade, wouldn’t go into effect until after the next election. Analysts say the federal budget reductions could weaken what is anticipated to be a slow recovery in 2013 and 2014.

Read a “fine print” summary of the bill from Nate Silver, fivethirtyeight.com/New York Times.

Read the text of the bill.

Vermont’s delegation is split on the so-called Reid-McConnell deal. Sen. Patrick Leahy reluctantly supports the bill. He emphasizes the importance of averting a default that would have sent “shock waves” through the economy.

“We have to understand the choice is not between this bill and something better,” Leahy said in a video message to Vermont constituents on his website (footage is included at the bottom of this post). “I would look for something better if I could.”

Sen. Bernie Sanders, I-Vt., adamantly opposes the Budget Control Act Amendment of 2011, and plans to vote against it on Tuesday. He described the deal in a speech (on video) as “immoral” and “grotesquely unfair.”

Rep. Peter Welch, D-Vt., cast his vote with the nays. He told Vermont Public Radio that it was one of the “most difficult decisions” he’d faced in Congress, and he described the vote as a “pick your poison situation.”

A default would have led to immediate fiscal fall out on Wall Street, bank credit would have been tightened further and the nation’s credit rating would have taken a hit. Economist Paul Krugman is predicting, however, that the debt ceiling deal itself will slow the nation’s growth in 2013 and 2014 when the caps on spending kick in.

Welch decried the extreme partisanship that has gripped Congress since Tea Party activists began taking the GOP and Capitol Hill in a far rightward direction in January.

“I also voted against this bill because it validates the tactic of putting a gun to the head of the American economy to advance a party’s agenda,” Welch said in a statement. “Never before has a willful majority in Congress held hostage the full faith and credit of the United States of America in order to get its way on the budget.”

As deputy minority whip, Welch led an effort to pass a “clean extension” of the debt ceiling without conditions. The effort failed in May.

Welch said he couldn’t support the new measure because “it is not a balanced plan with shared sacrifice.”

The congressman would have preferred a broad plan that would have restored fiscal stability and made important investments in the economy.

“It ignores glaring inequities in the federal tax code while cutting programs important to the middle class, seniors, and low-income Americans,” Welch said in a statement. “There is simply no excuse for condoning continued tax breaks for Wall Street hedge fund managers, the ethanol industry and big oil companies while the middle class struggles to hang on to their jobs, pay their bills and send their children to college.

Among the congressman’s chief concerns is the way the bill sets caps on spending. The language of the legislation is not specific, he said in a telephone interview Monday night, and he has “no idea what the cuts are.” The bill, Welch said, authorizes the “Ryan budget team to make those decisions.”

Under the proposed Ryan budget, discretionary spending for federal programs would be reduced by $923 billion over a 10-year period.

Rep. Paul Ryan’s plan for discretionary cuts includes a 20 percent reduction in the Foodstamps program.

Congressman Paul Ryan’s proposed budget, “A Roadmap for America’s Future,” lowers taxes for high-income individuals by a third and eliminates taxes on interest, capital gains, dividends and estates. It requires workers to invest a third of their Social Security taxes in private investments. Under the Wisconsin representative’s plan, Medicare coverage would become a private insurance program, facilitating $389 billion worth of cuts over 10 years, according to the Huffington Post. Medicaid would become a state block grant program giving states maximum flexibility to tailor Medicaid programs to the specific needs of their populations, leading to $735 billion in budget reductions. Ryan’s budget assumes that the Affordable Care Act is repealed, and if that becomes a reality, federal spending would be slashed by $1.4 trillion over the next decade.

Follow Anne on Twitter @GallowayVTD

Anne GallowayAnne Galloway

Comments

  1. Dennis Shanley :

    Thank you Bernie and Peter for standing up to terrorists.

  2. Jim Candon :

    Let’s see: Congress got us into this debt mess over the years. Now finally, some in Congress are trying to get us out of this debt mess. And they are terrorists? Little harsh, don’t ya think?

  3. Leahy, Sanders and Welch have been abject failures. Where do we stand on issues such as the right to vote? How about those protections of our only source of food, water, air and shelter? What’s up with that corporate personhood thing? How’re you doing with those Obama/DC Democratic Surrender Machine tax breaks for the ultra rich? What about torture and war?

    What about any single issue that progressives (and no – I don’t include Democratic voting liberals who are too scared of their own moniker to use it) consider important?

    Instead we’re saddled with more wars, greater corporate power over our lives, approval of torture, a nation being bankrupt due to a planned starving of taxes (you know – what the government does for revenue), and more really bad things.

    Leahy has gone to bat for copyright holders and the drug war, Sanders has given long floor speeches and Welch – well we know – don’t we? Welch joined his radical right wing allies in congress to attach ACORN – a group who’s only crime was to empower the politically disempowered (and Welch did this based entirely on lies – lies he stands by to this very day).

    Obama played progressives like a pro. He gave a great speech at the Democratic National Convention in 2004, and then he assumed (quite correctly) that most folks would interpret anything he said in the future through that 2004 speech.

    2004 was Obama’s big lie … Obama will support measures to do away with social security and medicare – because in the end (actions speak louder than words don’tcha know) Obama really doesn’t disagree with the radical right wing that is today’s Republican Party.

    And of course our abject failure troika of Leahy, Sanders and Welch will stand solidly beside and behind Obama in 2012.

    The first thing every true progressive needs to understand is that change begins at home; and in politics it should be an absolute refusal to provide money, time or votes for abject failure.

    There really is no difference in outcome in DC – Democratic Surrender Machine or Radical Right Wing – the results are coming out the same.

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