A Debt Limit History for the President
Last December, President Obama misrepresented decades of precedent regarding congressional consideration of the debt limit. In maintaining that he would not negotiate on the debt limit, he said:
“If Congress in any way suggests that they’re going to tie negotiations to debt ceiling votes and take us to the brink of default once again as part of a budget negotiation -- which, by the way, we had never done in our history until we did it last year -- I will not play that game.”
This statement erroneously tried to frame the debate as one of a reasonable President against a Congress that is trying to invent new ways to thwart his agenda. In reality, Congress is simply requiring that the President do what has been done many times since at least the Eisenhower Administration: debate our nation’s future spending as part of a vote that ratifies past spending.
Budget Measures Are Commonly Debated with the Debt Limit
The debt limit is the perfect time to debate the nation’s future fiscal condition. If a family hits their credit card limit, sometimes they may need to request an increase in the limit. But they will also have to do the responsible thing and review their past financial decisions and make changes for the future. This is exactly what Congress has done in the past when debating the debt limit, as illustrated by these examples from a study of debt limit history:
- 1953: The Eisenhower Administration requested the first debt limit increase since the end of World War II. While the House approved the request, many House Republicans made comments that show that the debt limit should be used to reevaluate the federal budget. One House member said that “one of the reasons for the [debt] limit was so that we could reexamine the operations of the Secretary of the Treasury as far as management of the debt is concerned.” The Senate Finance Committee actually voted to table the entire debt limit increase on an 11-4 vote. Two political scientists later wrote that this first increase effort since World War II “signaled the start of a pattern that made debt ceiling legislation a component of the broader efforts by fiscal conservatives to control government spending.”
- 1954: Congress passed the first temporary increase in the debt limit. The temporary method was used as a means to control future finances by forcing Congress and the President to readdress the debt limit when the temporary increase expired.
- 1955: Congress extended the 1954 temporary increase for a year. Senator Harry Byrd said that “this additional temporary extension should be regarded by the Administration as an indication of congressional notice that it should not be repeated again.”
- 1961-7: Congress raised the debt limit multiple times, with large Democratic majorities in both chambers carrying most of the burden of passing the increases. These continued the trend of viewing a debt limit increase vote as a referendum on national policy.
- 1964: The Johnson Administration circumvented the debt limit by offering a new type of security, a “participation certificate” that did not count toward the debt limit, and in fact was recorded on the federal books as “negative expenditures, thus reducing the size of the budget deficit.” Republicans viewed this as a gimmick.
- 1967: In early June, the House defeated a debt limit increase for the first time. In late June, it agreed to another bill increasing the debt limit. The bill reined in the ability of the Johnson Administration to use the participation certificate gimmick.
- 1970: The practice of attaching non-germane provisions to debt limit legislation began in earnest. Three unsuccessful amendments to the 1970 debt limit bill were: 1) cut defense spending by $6 billion; 2) freeze congressional pay until Congress passes a balanced budget; and 3) institute a federal spending cap.
- 1971: Social Security changes were included in the debt limit bill. This was the first time that Social Security changes were made in a debt limit bill.
- 1972: President Nixon included a spending cap and impoundment powers in his proposal to increase the debt limit.
- 1973: A campaign finance reform amendment to the debt limit bill was filibustered in the Senate and caused a delay in passing the underlying bill until after the previous “temporary” increase had expired.
- 1974: During consideration of this debt limit bill, attention was already shifting toward budget reform and what would become the Budget Act of 1974. The Ways and Means Committee said that the pre-Budget Act debt limit bill would provide some budget control “until Congress enacts legislation creating a legislative system” for budget control and consideration.
- 1979: Senators proposed an amendment to a debt limit bill that would require a balanced budget.
- 1980: While debating a debt limit bill, the Senate considered an amendment that would have strengthened the President’s rescission authority.
- 1980: Congress repealed an oil import fee in a bill that raised the debt limit. President Carter vetoed the bill and Congress overrode the veto 335-34 and 68-10.
- 1981: Multiple fiscal reform amendments were filed to a debt limit bill. Notable amendments included one to reduce tax deductions for business meals and another that would alter President Reagan’s 1981 tax cut law.
- 1982: Majority Leader Howard Baker allowed Senators to propose any amendment they wished to the debt limit bill. More than 1,400 amendments were filed. The Senate spent weeks debating Senator Jesse Helms’ amendment regarding federal court jurisdiction over busing and school prayer.
- 1983: Congress defeated a debt limit increase bill. Senator Russell Long linked the debt limit to future deficits, saying, “When you vote for this motion, you are voting to continue” large deficits.
- 1984: While debating a debt limit bill, the Senate considered an amendment that would have imposed a federal spending freeze.
- 1985: After three months of intense negotiations, Congress passed the Gramm-Rudman-Hollings deficit reduction plan as a part of a bill that raised the debt limit. Efforts during negotiations to allow short-term increases in the debt limit failed until Social Security checks were in jeopardy, at which point a temporary increase was allowed.
- 1987: A debt limit increase was the vehicle for a constitutional fix to Gramm-Rudman-Hollings. The sequester contained in Gramm-Rudman-Hollings was declared unconstitutional by the Supreme Court in 1986.
- 1987: The New York Times editorialized that “[e]ach time government borrowing gets close, the ceiling is raised — but not without costly eleventh-hour shenanigans that force the Treasury into devious financing.”
- 1990: Congress increased the debt limit in the same legislation as the 1990 budget deal. The debt limit was temporarily increased six times in the course of these negotiations.
- 1993: Congress increased the debt limit as part of the 1993 budget deal between President Clinton and a Democratic Congress.
- 1996: After two short-term increases in February and March, Congress increased the debt limit in the Contract for America Advancement Act, a bill that created the Congressional Review Act.
- 1997: Congress increased the debt limit as part of the balanced budget deal struck in negotiations between President Clinton and a Republican Congress.
- 2010: Congress, with both chambers controlled by Democrats, passed a debt limit increase as part of a bill that reestablished statutory Pay-As-You-Go budget rules.
- 2011: Congress passed the Budget Control Act that both increased the debt limit and cut federal deficits.
- 2012: President Obama claimed that the Budget Control Act was the first time that debt limit was taken to the brink as a part of budget negotiations.
The debt limit is indeed about paying for past obligations. But its history shows that the debt limit is the appropriate place -- and has repeatedly been used -- to debate deficit reduction for future years.
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