The Rise of the No New Debt Democrats

A quiet fiscal revolt played out in Congress this week as dozens of moderate and even some liberal Democrats told Speaker Nancy Pelosi to forget about her grand version of the so called "Tax Extender" bill.

Their objection? The fact that it added $134 billion to the deficit.

This was the bill Pelosi was using to add $47 billion dollars for unemployment benefits, which typically is a no-brainer vote for Democrats. Not this time.

Over in the Senate, same scene. Sen. Tom Harkin of Iowa, in an attempt to hold off the firing of tens of thousands of teachers, tried to add $23 billion onto the war funding bill for Iraq and Afghanistan.

Never mind whether pay for teachers is something that even belongs in a war funding bill -- that wasn't the obstacle. Harkin couldn't get the Democratic votes he needed to add that $23 billion to the deficit.

There's a pattern here: Call it the rise of the no new debt Democrats. For a week, Republicans had railed against the huge new spending bill, but by Tuesday they were spectators in deck chairs, watching as rank and file Democrats -- and not just the Blue Dogs -- repeatedly pushed Pelosi and Majority Leader Steny Hoyer to pare down the Tax Extender bill themselves.

Democratic Rep. Dutch Ruppersberger (Md.), who's generally seen as liberal, told Reuters the uprising against the monster bill was "a real victory for the moderates." He said, "our country is weakened by the deficit."

The intramural wrangling by Democrats had the effect of running out the clock so that by mid-afternoon Friday, when the House finally voted on $40 billion worth of unemployment benefits (in a bill which would have added $54 billion to deficit spending) it didn't matter, because the Senate had gone home.

And that would be the very Senate that Majority Leader Harry Reid swore would stay in session through Saturday if necessary to get that extra help to the nation's jobless. That's worth noting, because if Reid thought he could've passed what the House was cobbling together, he may have kept his promise. He didn't -- and so he didn't.

The revolt is also remarkable in light of what happened just three months ago, when Sen. Jim Bunning of Kentucky became a national punchline by stubbornly saying no to an unemployment benefit package that would add to the deficit. Democrats called him crazy and insensitive to the plight of the jobless. One reporter chased him into an elevator, demanding an explanation. Even Republicans kept Bunning at arm's length, because they were in on the deal: a 30 day extension of benefits, paid for with borrowing that even they said was justified during a recession because most of the money would be spent and would stimulate jobs.

So what changed? Did Bunning get smarter between February and now? Have the unemployment figures changed dramatically? Nope. What's changed is the politics of debt.

In the May 18 primary elections, which ousted Arlen Specter, elevated Rand Paul, and put Arkansas' Blanche Lincoln in a runoff, most of the winners had run against Washington. Some of the candidates ran pro-jobs campaigns, but no one doubts that anti-deficit fervor is in the wind and is powering the anti incumbent mood.

When Arlen Specter tried to argue he had the seniority to bring home the money, it didn't work. And this was in Pennsylvania, the state where John Murtha once ruled with pork. As the loss of Specter was sinking in last week, CBO scored the Tax Extender bill at minus $134 billion, and dozens of congressmen blanched. Who wanted their name attached to that level of new borrowing?

Speaker Pelosi praised what a wonderful, collaborative process it had all been -- but admitted the bill "was a heavy lift." It was also a defeat. She says the stripped down version of the Tax Extender Bill will be handled by the Senate when Congress returns from a week's vacation. Maybe. The bill itself has many crucial parts that Congress in fact has to address at some point. It extends the R&D tax breaks that business calls essential to job creation. It patches a 21 per cent cut in what Medicare pays to doctors. It raises oil taxes to increase the Government's fund for oil spills.

But it doesn't come close to paying for itself. It has tax increases Republicans will bitterly oppose. It's not a lock for quick passage.

We don't know yet if the rise of the no new debt Democrats represents a fundamental, long term shift. But we do know the anti-deficit wing of Democrats in Congress is much larger and stronger than it was just a few weeks ago. It not only flexed some muscle this week, it threw a punch the leadership didn't see coming.

Wyatt Andrews is a CBS News Washington Correspondent. John Nolen is a CBS News Capitol Hill Producer.

  • Wyatt Andrews

    Wyatt Andrews is a CBS News National Correspondent based in Washington D.C. He is responsible for tracking trends in politics, health care, energy, the environment and foreign affairs.