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| ==Projected effects== | ==Projected effects== | ||
| ⚫ | John S. Irons of the ] stated, "The spending cuts in 2012 and the failure to continue two key supports to the economy (the payroll tax holiday and emergency unemployment benefits for the long term unemployed) could lead to roughly 1.8 million fewer jobs in 2012, relative to current budget policy."<ref>{{Cite web| last = Irons | first = John S. | title = What’s missing from the debt ceiling debate? Jobs| publisher = ]| date = August 1, 2011| url = http://www.epi.org/analysis_and_opinion/entry/whats_missing_from_the_debt_ceiling_debate_jobs/ | accessdate = 2011-08-03}}</ref> | ||
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| ==See also== | ==See also== | ||
Revision as of 06:17, 4 August 2011
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| Effective | (Various dates for different provisions) |
|---|---|
| Citations | |
| Public law | Public Law 112-25 |
| Statutes at Large | ? Stat. ? |
| Legislative history | |
| |
The Budget Control Act of 2011 (Pub. L. 112–25 (text) (PDF), S. 365), was passed by the 112th United States Congress on August 2, 2011, and signed into law by President Barack Obama on that same day. It brought conclusion to the 2011 United States debt ceiling crisis, which had threatened to lead the United States into default on or about August 3.
Provisions
The Budget Control Act entails:
- A reduction in spending of more than the increase in the the debt limit. In the first installment ("tranche"), $917 billion would be cut over 10 years in exchange for increasing the debt limit by $900 billion.
- The agreement establishes a joint committee of Congress that would produce debt reduction legislation by November 23, 2011, that would be immune from amendments or filibuster. The goal of the legislation is to cut at least $1.5 trillion over the coming 10 years and be passed by December 23, 2011. The committee would have 12 members, 6 from each party.
- Projected revenue from the committee's legislation must not exceed the revenue baseline produced by current law.
- An increase of Pell grant funding, but a cut in other financial aid. Graduate and professional students will no longer be eligible for interest subsidized loans. Repayment incentives will also be done away with after July 1, 2012.
- The agreement specifies an incentive for Congress to act. If Congress fails to produce a deficit reduction bill with at least $1.2 trillion in cuts, then Congress can grant a $1.2 trillion increase in the debt ceiling but this would trigger across-the-board cuts ("sequestration") of spending equally split between defense and non-defense programs. The across-the-board cuts would apply to mandatory and discretionary spending in the years 2013 to 2021 and be in an amount equal to the difference between $1.2 trillion and the amount of deficit reduction enacted from the joint committee. The sequestration mechanism is the same as the Balanced Budget Act of 1997. There are exemptions—across the board cuts would apply to Medicare providers, but not to Social Security, Medicaid, Medicare beneficiaries, civil and military employee pay, or veterans.
- Congress must vote on a Balanced Budget Amendment between October 1, 2011, and the end of the year.
- The debt ceiling may be increased an additional $1.5 trillion if either one of the following two conditions are met:
- A balanced budget amendment is sent to the states; or
- The joint committee cuts spending by a greater amount than the requested debt ceiling increase.
Most of the $900 billion in cuts occur in future years and so will not remove significant capital from the economy in the current and following year. Regarding the across the board cuts, these could not take place until 2013 and so if triggered, a new Congress could vote to eliminate or deepen all or part of them. Speaker Boehner was reported to be particularly concerned that any defense cuts could not go into effect until after 2013. The agreement contains the McConnell mechanism for the specified debt ceiling increases. The President may make the specified increases, but to stop them the Congress must pass a bill to disapprove of them by the two thirds majority needed to override a veto.
Legislative history
The bill was the final chance in a series of proposals to resolve the 2011 United States debt ceiling crisis, which featured bitter divisions between the parties and also pronounced splits within them. Earlier ideas included the Obama-Boehner "Grand Bargain", the House Republican Cut, Cap and Balance Act, and the McConnell-Reid "Plan B" fallback. All eventually failed to gain enough general political or specific Congressional support to move into law, as the midnight August 2, 2011, deadline for default drew nearer and nearer.
On July 31, 2011, President Obama announced that the leaders of both parties in both chambers had reached an agreement that would reduce the deficit and avoid default. The same day, Speaker of the House John Boehner's office outlined the agreement for House Republicans.
The agreement, entitled the Budget Control Act, passed the House on August 1, 2011 by a vote of 269-161; 174 Republicans and 95 Democrats voted for it, while 66 Republicans and 95 Democrats voted against it. One moment of extra drama came when Arizona Congresswoman Gabrielle Giffords made her first appearance back on the floor of Congress following the near-fatal assassination attempt upon her in the 2011 Tucson shooting; she voted in favor of the bill.
The Senate passed the agreement on August 2, 2011 by a vote of 74-26; seven Democrats and 19 Republicans voted against it. Obama signed the bill shortly after it was passed by the Senate.
Legislative voting breakdown
Final House vote
Passed with amendment by recorded vote: "To make a technical amendment to the Education Sciences Reform Act of 2002" // Roll call vote 690, via Clerk.House.gov
| Vote by Party | Yea | Nay | NV | Total |
|---|---|---|---|---|
| Republicans | 174 | 66 | 0 | 240 |
| Democrats | 95 | 95 | 3 | 193 |
| Total | 269 | 161 | 3 | 433 |
Final Senate vote
Agreed in the House amendment to the bill by Yea-Nay Vote // Roll call vote 123, via Senate.gov
| Vote by Party | Yea | Nay | NV | Total |
|---|---|---|---|---|
| Democrats | 45 | 6 | 0 | 51 |
| Republicans | 28 | 19 | 0 | 47 |
| Independents | 1 | 1 | 0 | 2 |
| Total | 74 | 26 | 0 | 100 |
Projected effects
John S. Irons of the Economic Policy Institute stated, "The spending cuts in 2012 and the failure to continue two key supports to the economy (the payroll tax holiday and emergency unemployment benefits for the long term unemployed) could lead to roughly 1.8 million fewer jobs in 2012, relative to current budget policy."
See also
References
- Levy, Gabrielle (August 8, 2011). "Debt-limit deal increases funding for Pell Grants". The Sacramento Bee. Medill News Service. Retrieved August 2, 2011.
- ; (July 31, 2011). "U.S. leaders strike debt deal to avoid default". Los Angeles Times.
{{cite news}}: Cite has empty unknown parameter:|1=(help) - DeFrank, Thomas (July 31, 2011). "President Obama says Republican, Dem leaders have reached agreement with him to raise debt ceiling". The New York Daily News.
- "Boehner's Debt Ceiling Agreement Presentation". New York Times. July 31, 2011.
- "Debt-Ceiling Deal: President Obama Signs Bill as Next Fight Looms". ABC News. Retrieved 2 August 2011.
- ^ Obama Signs Debt-Ceiling Plan Hours Before Deadline
- http://dailycaller.com/2011/08/01/house-passes-budget-control-act-after-dramatic-visit-from-rep-gabby-giffords/
- Senate passes debt deal, 74-26
- Irons, John S. (August 1, 2011). "What's missing from the debt ceiling debate? Jobs". Economic Policy Institute. Retrieved 2011-08-03.
External links
- S. 365
- Pub. L. 112–25 (text) (PDF)
- Bill as seen by Congress, via GPO.gov
- Bill at crocodoc site, via FoxBusiness.com