Parties far apart on how to address debt ceiling deadline

The U.S. House of Representatives overwhelming rejected a Republican proposal to increase the debt limit by $2.4 trillion.

Republicans signaled well in advance that the debt limit vote was political theater designed to reinforce a demand for spending cuts to accompany any future increase in government borrowing.

The vote Tuesday was 97-318, far below the two-thirds majority needed for passage.

The debt ceiling raises the legal limit on the amount of money the U.S. Treasury is allowed to borrow.

While Tuesday's measure unsurprisingly failed because it lacks the spending cuts that Republicans insist as a condition for their support, some Minnesotans say Congress will have to raise the debt limit soon.

Republican Bill Frenzel spent 20 years representing Minnesota's 3rd Congressional District before retiring in 1991.

He always voted to raise the debt ceiling -- even if his vote was unpopular with constituents and colleagues. Frenzel said the original purpose of debt ceiling votes was to make legislators act frugally with the nation's credit card. But from the beginning, they never worked.

Instead, Frenzel said lawmakers would vote for all kinds of spending bills and tax cuts. Then they would vote against more borrowing.

"What they were saying is that they didn't want to pay for the money they already spent," Frenzel said.

Which is exactly what lawmakers are doing again this time.

Late last year, members of both parties agreed to temporarily keep tax cuts in place -- which increased the deficit. Then earlier this year, both parties agreed on a spending plan through September that spends more money than it takes in.

For Democrats like 1st District Rep. Tim Walz, voting to increase the debt ceiling is a necessary, albeit sometimes unpleasant, part of governing.

"This is one of those issues that has all kinds of political theater wrapped in it, but it is one of the very few votes here that is very clear cut if you don't get it done," Walz said.

The Treasury Department is already taking what it calls "extraordinary measures" to pay the government's bills, but has said it will run out of cash by early August.

After that, the United States needs to borrow more money or it will have to stop paying some of its debts. Many economists believe if that happens, interest rates will shoot up, potentially sending the economy back into a recession.

That makes this a tough vote for Republicans who are close to the business community, including Erik Paulsen, who represents Minnesota's 3rd District. He's taking the party line and will vote against this increase in the debt ceiling. But in an interview with MPR News last week, Paulsen said a deal that cuts spending would get his vote and calm the markets.

"I think Wall Street knows that the most important thing we can do to settle the markets or to keep the markets healthy and strong is to have a real spending plan put forward," Paulsen said.

Meanwhile, Tea Party supporters such as Republican Rep. Michele Bachmann of Minnesota's Sixth District, say the United States should stop borrowing money.

Speaking on Fox News in May, Bachmann said the government should simply balance this year's $1.4 trillion budget deficit by slashing spending right away.

"Just because Congress has authorized spending for various programs doesn't mean that we have to fulfill that spending," said Bachmann.

Bachmann, who is considering a run for president, likens her approach to cutting up the credit cards when you're too far in debt.

Democratic Rep. Keith Ellison of the Fifth District said linking a family's finances to those of the world's largest economy is usually a poor comparison. But this time he thinks it's a useful analogy.

"If we said, look, our family is just going to decide our debt ceiling is $100 this month but your credit card bill is $200, then you're going to default," he said. "And what is going to happen to your credit score? You're going to be considered less credit worthy, and that is exactly what is going to happen to the United States."

Ellison and many Democrats plan to vote for an increase in the debt ceiling while almost all Republicans will vote against it, thus sinking the measure.

Then negotiators from both parties will have to roll up their sleeves and find a way to craft an acceptable deal -- ideally before the Treasury runs out of cash in early August.