Congress approved and President Obama signed a bill raising the federal debt ceiling and making cuts to the federal budget mere hours prior to a deadline to lift restrictions on borrowing or trigger default.
Weeks of bitter debate, on-and-off again negotiations and all weekend talks gave way to easy passage in both the House and Senate in Washington. The Senate today approved the bill on a 74-to-26 vote after the House passed the measure 269-161 Monday evening. All of Nebraska’s congressional delegation voted in favor of the bill, except for Senator Nelson.
Nelson, a Democrat, says he voted against the measure, because it could lead to Medicare cuts. Nelson says the special congressional committee the bill creates to propose additional budget cuts to Congress could easily target Medicare.
“And, at some point, it’s no longer about cutting back the reimbursement to providers, such as hospitals, but it actually goes to allow the super committee to make cuts, in effect, to beneficiaries as well,” Nelson tells Nebraska Radio Network in an interview after the vote.
Nelson insists Congress can rein in the federal budget without cutting Medicare.
Senator Johanns, though, says Medicare cannot be spared if Congress is going to rein in the federal budget. Johanns, a Republican, voted for the bill. Johanns says there’s a reason Medicare has become a challenge.
“My generation, the Baby Boomers, are accessing it. Medical inflation is going up and there isn’t enough money coming into the system to pay the bills,” Johanns says. “Well, guess what, that’s going to be a crisis unless we deal with it.”
Johanns says he voted in favor of the bill, even though it falls short of the budget cuts he believes are needed. Johanns says he would have like to see $4 trillion in cuts.
The measure passed by Congress lifts the $14.3 trillion debt limit and gives the Treasury Department immediate authority to borrow an additional $400 billion. The debt limit will be raised in three stages to at least $2.1 trillion, enough money to pay the nation’s bills into early 2013. The deal cuts approximately $900 billion over the next ten years, putting off any cuts until October.
A special congressional committee is created by the legislation, charged with finding an additional $1.2 trillion more in budget cuts. If Congress refuses to adopt its recommendations, automatic spending cuts would be triggered, half from domestic programs, half from defense.
What happens next depends greatly on what that special committee proposes to Congress, according to a skeptical Nelson, who says budget cuts should have been made up front.
“Assuming that an evenly split committee down party lines is going to be able to come up with anything,” Nelson says echoing his warning that the committee could well recommend cuts to Medicare.
Yet, Johanns says the committee must be free to consider cuts to entitlement programs such as Medicare.
“Without reform here in those entitlement programs, we will pass the most dreaded legacy to our children and grandchildren in the history of this nation and we can’t let that happen,” according to Johanns.
Default on the national debt has been averted, but the full scope of budget cuts has yet to be determined.