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House approves debt bill with Giffords in attendance

By David Espo

Associated Press

LAST UPDATED: 3:49 p.m. HST, Aug 1, 2011

WASHINGTON >> Emergency legislation to avoid an economy-rattling government default sped through the House Monday night, a scant day before the deadline for action — the dramatic vote made all the more memorable by Rep. Gabrielle Giffords' first appearance in Congress since suffering a head wound in a shooting six months ago.

The vote was 269-161, but all eyes were on Giffords, who drew thunderous applause as she walked into the House chamber and cast her vote in favor of the bill.

A final Senate sign-off for the measure is virtually assured on Tuesday.

"If the bill were presented to the president, he would sign it," the White House said, an understatement of enormous proportions.

Hawaii U.S. Reps. Colleen Hanabusa and Mazie Hirono both voted in favor of the proposal.


“Hundreds of people across Hawaii have called our office in the last few days asking that we support President Obama and get an agreement done,” said Hirono in a statement. “They’ve been clear they want a compromise that raises the debt ceiling, reduces the deficit, and protects Social Security and Medicare. That is why I supported this agreement."

Hanabusa said, “With extreme reservations, I voted to support the compromise bill, negotiated by President Obama — because allowing the United States to default on its obligations for the first time in history is not an option for me. I just couldn’t stand by and let the millions of Americans who are already struggling financially to take another hard economic blow. A default could have increased interests cost by $100 billion a year, and would have impacted everything from mortgages and credit cards, to student loans and car loans."

After months of fiercely partisan struggle, the House's top Republican and Democratic leaders swung behind the bill, ratifying a deal sealed Sunday night with a phone call from House Speaker John Boehner to President Barack Obama.


"The legislation will solve this debt crisis and help get the American people back to work," Boehner said at a news conference a few hours before the vote.The measure would cut federal spending by at least $2.1 trillion over a decade — and possibly considerably more — and would not require tax increases. The U.S. debt limit would rise by at least $2.1 trillion, tiding the Treasury over through the 2012 elections.

Moving with unusual speed, Republican leaders ordered debate to begin on the House floor at mid-afternoon. That followed public pledges of support from some first-termers as well as veteran defense hawks — two areas of concern with the agreement.

Rep. C.W. (Bill) Young, chairman of the committee that handles the defense budget, said, "We're confident that we can make this happen without affecting readiness and without affecting any of our soldiers."

There were Republican critics, as well, but they were harder to find than last week when they derailed an earlier bill Boehner brought to the floor.

"I'm looking for a reason to vote yes," said Rep. Louie Gohmert of Texas, shortly before debate began on the measure. "I haven't found it, and I've been looking since 2 a.m."

After months of wrangling over a deal, there was little time left for lawmakers to decide.

Without legislation in place by the end of Tuesday, the Treasury would run out of cash needed to pay all its bills. Administration officials say a default would ensue that would severely damage the economy.

Beyond merely avoiding disaster, Obama and congressional leaders hoped their extraordinary accord would reassure investors at home and around the world, preserve the United States' Aaa credit rating and begin to slow the growth in America's soaring debt. In a roller-coaster day on Wall Street, the Dow Jones industrial average surged, then sank and finally finished down for a seventh straight session but only slightly.

Already, the legislation was emerging as an issue in the 2012 presidential campaign.

Rep. Michele Bachmann of Minnesota and former Massachusetts Gov. Mitt Romney announced their opposition, while Newt Gingrich issued a statement without saying how he would vote.

The final legislation reflected the priorities of the two political parties.

It would immediately increase the debt limit by $400 billion, with another $500 billion envisioned unless Congress blocks it. At the same time, it would cut more than $900 billion over 10 years from the day-to-day operating budgets of Cabinet agencies. For the budget year that begins Oct. 1, spending would be held $7 billion below current levels.

The measure also establishes a 12-member House-Senate committee that will be charged with producing up to $1.5 trillion in additional deficit cuts over a decade. If the panel succeeds, Congress will be required to vote on the recommendations without possibility of changes.

If the panel deadlocks or fails to produce at least $1.2 trillion in deficit savings, then spending cuts are to take effect across much of the federal budget. The Pentagon, domestic agencies and farm subsidies would be affected, as would payments to doctors and other Medicare providers. But individual benefits under Social Security, Medicaid, Medicare and programs for veterans and federal retirees would be exempt.

At the same time, the debt limit would rise by at least another $1.2 trillion, and perhaps — depending on the results of the committee's work — as much as $1.5 trillion.

Additionally, the legislation requires both the House and Senate to vote on a balanced-budget amendment to the Constitution.

The measure also increases funding for Pell Grants for low-income college students by $17 billion over the next two years, financed by curbs on federal student loan subsidies.

The result of weeks of negotiations and harsh arguing, the final result represented a product of divided government that gave neither side everything it wanted. Leaders in both parties were emphatic on that point.

"As with any compromise, the outcome is far from satisfying," conceded Obama in a video his re-election campaign sent to millions of Democrats. In a tweet, the president was more positive: "The debt agreement makes a significant down payment to reduce the deficit — finding savings in both defense and domestic spending."

But there were critics within his own party in Congress.

House Democratic leader Nancy Pelosi declined to say how she would vote — a clear indication of displeasure with the deal Obama had made. Asked if the votes were there for passage, she replied, "You'll have to ask the speaker. He has the majority."

Boehner rebutted that all congressional leaders had signed off the deal and shared in responsibility for lining up the votes for it.

After Biden met with rank-and-file Democrats, he conceded, "They expressed all their frustration."

He said the deal "has one overwhelming redeeming feature" — postponing the next debt limit battle until 2013 and putting the current fight behind. "We have to get this out of the way to get to the issue of growing the economy," he said.

Rep. Elijah Cummings, D-Md., said his constituent mail was running 8-1 against the bill, but he did not say how he intended to vote.

"This is a tough sell I think for most Democrats, a tough sell," he said.


Associated Press writers Jim Abrams, Stephen Ohlemacher, Alan Fram, Julie Pace, Andrew Taylor, Donna Cassata and Larry Margasak contributed to this report. 

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