WASHINGTON – House Majority Leader Steny Hoyer praised the fiscally conservative Blue Dog Coalition Wednesday for supporting his “pay-as-you-go” legislation, which comes up for a vote in the House on Thursday.
The provision, commonly referred to as PAYGO, attempts to control deficit spending by requiring that all new legislative tax cuts and entitlement spending increases be offset by cutting spending or increasing revenue elsewhere in the budget.
Both Hoyer, D-Mechanicsville, and President Obama have stressed the importance of PAYGO as a first step toward bringing fiscal responsibility back to Washington.
“It is a critical, absolutely essential policy for us to reinstate in the fiscal policy of this country and this Congress,” Hoyer said in a news conference with the Blue Dogs. “America is going to pay its bills.”
Hoyer was flanked by 15 members of the Blue Dog Coalition, a group of more than 50 House Democrats who push for fiscally conservative policies.
Rep. Baron Hill, D-Ind., said the Blue Dogs only voted for the $787 billion stimulus bill last year because they were assured by Obama that the federal government would enact statutory PAYGO later.
“It is my belief that it will play a substantial role, as all of these individuals behind me believe, in bringing this nation back to a balanced budget,” Hoyer said. “It’s going to take some time because we are deeply in debt.”
The legislation was added to a bill that raises the U.S. debt limit to $14.3 trillion, which would allow the federal government to borrow another $1.9 trillion. The Senate passed a similar bill last week on a party-line vote.
Rep. Frank Kratovil, D-Stevensville, the only Marylander who is an official Blue Dog, issued a statement praising PAYGO’s passage in the Senate.
“I have been a strong advocate for reinstating the pay-as-you-go budget law that helped to create the record surpluses of the 1990s,” Kratovil said. “I look forward to continuing the fight to ensure fiscally responsible budget reforms.”
If the bill passes as Hoyer and the Blue Dogs expect, it won’t be the first time PAYGO has been put into effect.
The first version of PAYGO was signed into law by former President George H.W. Bush in 1990. Many Democrats have cited the rule as a key factor behind the budget surpluses of the 90s.
The statute expired under former President George W. Bush in 2002, which cleared the way for Bush’s 2003 tax cuts and Medicare prescription drug program. Democrats have blamed the deficits that built up under the previous administration on Republicans who allowed the law to expire.
In one of his first acts after becoming House majority leader in 2007, Hoyer helped bring PAYGO back as a standing budget rule in the House, but the Senate has since struggled to abide by the spending restrictions. If passed, Hoyer’s version of PAYGO would put the restrictions into law and force both houses of Congress to abide by the rules.
Hoyer has been a longtime champion of PAYGO rules. He introduced a statutory PAYGO bill in June 2009, which the House passed in July, but the bill failed to take hold in the Senate.
It’s unclear how much Republican support the bill will receive in the House. No Senate Republicans voted for the measure, which was also included in a bill to raise the debt limit. The PAYGO bill that passed the House last July received 24 Republican votes.
Other members of the Blue Dog Coalition described the provision as a critical first step toward getting government spending under control.
“This country simply has no choice,” said Rep. John Tanner, D-Tenn. “We are on an unsustainable march toward a fiscal Armageddon.”
Rep. Baron Hill, D-Ind., said, “This is the one mechanism that will discipline the Congress to get our fiscal house in order.”
Rep. Earl Pomeroy, D-N.D., applauded Hoyer for his leadership: “Steny took the football and is going to cross the goal line restoring pay-as-you-go into federal law.”