WASHINGTON -- Senate Democrats on Wednesday proposed allowing the federal government to borrow an additional $1.9 trillion to pay its bills, a record increase that would permit the national debt to reach $14.3 trillion.
The unpopular legislation is needed to allow the federal government to issue bonds to fund programs and prevent a first-time default on obligations. It promises to be a challenging debate for Democrats who, as the party in power, hold the responsibility for passing the legislation.
The record increase in the so-called debt limit is required because the budget deficit has spiraled out of control in the wake of a recession that cut tax revenues, the Wall Street bailout, and increased spending by the Democratic-controlled Congress. Last year's deficit hit a phenomenal $1.4 trillion, and the current year's deficit promises to be as high or higher.
Congress has never failed to increase the borrowing limit, but it will take 60 votes to pass the legislation under an agreement by top Senate leaders.
Getting 60 votes became more complicated after Sen.-elect Scott Brown's victory Tuesday in Massachusetts. Democrats will shortly have 59 Senate seats and will need at least one Republican to pass the legislation.
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