Senate votes to raise limits on national debt

Video: Rep. Paul Ryan's roadmap to get U.S. out of debt

Closed captioning of: Rep. Paul Ryan's roadmap to get U.S. out of debt

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>> now for the political roundtable, ranking member of the budget committee , congressman paul ryan, who has an op-ed in today's " wall street journal ." in it he writes this. "in tonight's state of the union address , president obama will declare a newfound commitment to fiscal responsibility to cover the huge spending and debt he and congressional democrats have run up in his first year in office. but next monday when he submits his actual budget , i fear it will rely on gimmickry, commissions, lukewarm spending freezes, and paper-tiger controls to create the illusion of budget discipline."

>> hey, paul, it's always good to talk to you. obviously, let's state the obvious right up front so we can have an honest conversation. obviously, much of the debt that's been driven up over the last five, ten years has been driven up by republicans, not president obama and the democratic party .

>> the president inherited a bad fiscal situation and has made it much, much, much worse. that's the problem. the budget we have right now is the obama budget . it doubles the debt in five years and triples it in ten years. we gave the epa a 120% increase in just their budget alone. 20% spending increase for government agencies over the last two years. a gusher of new spending out of washington on top of, yes, the bad fiscal situation that they inherited. they said we just made it worse and that's my point.

>> so if you freeze domestic spending, discretionary domestic spending for three years, are you saying that's not enough?

>> absolutely it's not enough. we should have done it a couple of years ago, but it's kind of a thaw more than a freeze. the reason i say this is because they're only freezing about 17% of the budget . you've got a lot more of the budget that's growing very, very fast and they're not addressing any of that and they're now still trying to jam through a $1 trillion entitlement program that grows at 8% a year according to the congressional budget office . so, yes, it sounds like it's being fiscally responsible to say the word "freeze," but you're exempting so many programs from the freeze that you're only freezing a small fraction of government and at the same time trying to grow all these other programs. that's the problem.

>> and to just add to that, my worry, joe, is that this is just kind of going to look contrived to deal with what is a growing unpopularity in this white house in terms of their policies. it looks like just a reaction to polls.

>> well, they obviously are walking a fine line . it is a reaction to polls. mike barnicle , the president's been bleeding support from independents for some time. they are obviously very concerned about the deficit. at the same time, you've got the president, who's a keynesian, who believes if you spend more in the federal government , you'll grow the economy.

>> you know, paul ryan's uncle is one of the great cardiologists in the world, who lives in minneapolis, in that state, before the election, all you heard from voters, no matter where they were in the health care plan, whether they were for health care reform or said my health care plan is okay now, the universal question was, how much is it going to cost and can we really afford this?

>> democrats concerned about the deficit.

>> and i would assume, congressman, that this is what you're getting at with this new blueprint?

>> it is. it is. i talked to my uncle last week and he said, we finally beat the democrat machine and this health care bill is a disaster. that's from a very well-known cardiologist. and i put this new blueprint out here, which is a version i put out before, a road map for america . the point i'm trying to make here is it is not too late for america to turn its fiscal problems around and save this country from a mountain of debt. but we've got to act soon before it's too late. i'm simply saying, here's a real plan , real legislation with real numbers that shows you how to fulfill the mission of health and retirement security. the mission of these programs without bankrupting this country.

>> paul, hold that up again and tell us how we can access it online if somebody wants to read it.

>> www.americanroadmap.org. it walks you through the plan. it's a plan to turn our economy around and pay our debt off with, fulfill the mission of health and retirement security. to me, we've got to turn this thing around, because if we wait too much longer, it's going to be very painful.

>> dylan, that's the real problem. everybody knows the real problem is, the growing deficits, the growing debt, medicare going bankrupt, social security --

>> everybody's figured out the rhetoric. they've figured out the rhetoric. now let's see if we can get anything done.

>> how do you do?

>> america 's watching our political leaders and asking that very question. do they work for the country, for voters, for --

>> the concern crosses party line .

>> we get the rhetoric. a kindergarten could do the rhetoric at this point.

>> here's an actual plan. here's a way to do it. here's a specific, actual idea and plan.

>> dylan ratigan is going to read that plan --

>> i already looked at it. your health care stuff makes a ton of sense. just assign the credit to the people and let people -- anyway, we'll do it another time.

>> and let me ask really quickly, do you agree with chuck schumer and orrin hatch 's plan that we talked about earlier today? harold ford also supports it, that you give tax cuts to small businesses in the form of payroll tax to hire unemployed workers?

>> i think a payroll tax is a good idea, but we shouldn't be doing tax increases in 2011 on small businesses , which is in the plan. stop these tax rate increases, that's going to kill jobs.

>> congressman paul ryan, thank you

Show transcript

msnbc.com staff and news service reports

updated 1/28/2010 4:05:37 PM ET

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WASHINGTON — Senate Democrats needed all 60 votes at their disposal Thursday to muscle through legislation allowing the government to go $1.9 trillion deeper in debt.

Democratic leaders were able to prevail on the politically volatile 60-39 vote only because Republican Sen.-elect Scott Brown of Massachusetts has yet to be seated. Republicans had insisted on a 60-vote, super-majority threshhold to pass the measure. An earlier test vote succeeded on a 60-40 vote.

The measure would put the government on track for a national debt of $14.3 trillion — about $45,000 for every American — and it served as a vivid reminder of the United States' dire fiscal straits.

The current $12.4 trillion debt ceiling — the limit Congress sets on government borrowing — is expected to be reached in mid-February.

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4. This summer in Congress, electioneering meets lawmaking
5. Obama's continued assault on Romney's corporate pedigree

Congress has never allowed the United States to default on its obligations, which would roil markets and likely cause the government to lose its AAA credit rating.

"We have gone to the restaurant, we have eaten the meal. Now the only question is whether the government will ... pay the bill," said Finance Committee Chairman Max Baucus, D-Mont.

Democrats had to scramble to approve the plan, so they won't have to vote on another increase until after the midterm elections this fall. The House must still vote on the measure before it is sent to Obama for his signature.

The task was made more difficult last week when Brown won the late Edward M. Kennedy's Senate seat from Massachusetts. On Feb. 11, when Brown plans to take office, the Democrats' majority shrinks to 59 and the GOP will have a 41-vote ability to block what it doesn't like in Obama's and Democratic leaders' agendas.

"It took 200 years to build the federal debt to a total of $1.9 trillion," Sen. Judd Gregg, R-N.H., said. "Now the majority wants to increase the current limit ... by $1.9 trillion so that we can finance the government's borrowing binge long enough to get us past the November 2010 elections."

Republicans blame recent generous spending bills enacted by the Democratic-controlled Congress for driving up the debt. Those measures, however, are just one relatively small part of the problem. The far bigger element is a sharp drop-off in tax revenues because of the recession and the economy's slow recovery, as well as higher costs, since more people are taking unemployment benefits and food stamps in tough times.

As part of the debt ceiling bill, the Senate also voted on new "pay-as-you-go" budget rules to make it more difficult for the government to run up its deficit. The new rules attempt to curb the spiraling budget deficit by requiring spending increases or tax cuts to be "paid for" by Congress with cuts to health programs, farm subsidies and veterans' pensions or tax increases.

Senate Majority Leader Harry Reid, D-Nev., whose own re-election is in danger this fall, reversed course and came out in support of the new rules after moderate "Blue Dog" Democrats in the House insisted on them as condition for passing a new $14.3 trillion debt ceiling.

Obama's Democratic allies in the Senate rejected a plan attempting to adopt a modified version of the president's proposal to freeze spending on domestic spending passed by Congress in annual spending bills.

A 56-strong majority of senators supported the plan, but it failed because 60 votes were required. It serves as a marker for later this year when Congress passes its budget.