Pay-as-you-go requires new federal spending — with some significant exceptions — to be immediately offset by either spending cuts or revenue increases.
“Pay-as-you-go is a serious and proven rule to force the federal government to spend within its means,” said Herseth Sandlin, a Democrat.
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The pay-as-you-go rules were approved Thursday by the House of Representatives after the Senate approved them Jan. 28.
Some federal spending isn’t subject to pay-as-you-go rules. The rules allow the government to extend President George W. Bush’s tax cuts, prevent a pay cut for doctors treating Medicare patients through 2014, lower the estate tax for two years and prevent the Alternative Minimum Tax from hitting a broader segment of the population for two years.
Herseth Sandlin said those compromises were necessary for pay-as-you-go to pass the Senate.
“We should do it for everything,” she said. “However, in getting these rules back on the books we had to be pragmatic and know what we were up against with the Senate.”
The House of Representatives passed the pay-as-you-go rules 233-187.
The Senate passed the rules 60-40, the bare minimum needed to break a filibuster.
Johnson, a Democrat, hailed the new rules.
“Now that the economy appears to be stabilizing, returning to measures like Pay-Go is not only common-sense, it’s necessary,” Johnson said in a statement.
All Senate Republicans, including Sen. John Thune, voted against the pay-as-you-go rules. Thune didn’t release a statement explaining his vote, but in a June 2009 speech he declared his opposition to pay-as-you-go.
“If we look at the reality of what happened in the last few years, despite all the lip-service paid to pay-go, it doesn’t apply all that much,” Thune said. “So what is it really good for? Well, it seems to me it is a statutory excuse to raise taxes.”
The pay-as-you-go rules were attached to another bill raising the cap on government borrowing by $1.9 trillion.
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