More PayGo: Will The Senate Follow The President's Lead?

The House of Representatives is generally considered the more profligate of the two legislative branches, but the truth, particularly when considering the fated history of Pay-As-You-Go budget rules, is more complicated.

Something important to keep in mind about Obama's PayGo announcement today: this is the first bill written by the White House and transmitted to Congress. For a White House that likes to make symbolic gestures, well, here you go.

Putting aside the Obama-crafted exemptions, the stimulus package and his budgets -- which is, um, everything, there is some evidence that the administration is intellectually serious about statutory PayGo. The director of the Office of Management and Budget, Peter Orszag, is credible on the subject. Obama has been a public supporter of statutory PayGo since his campaign days, and wouldn't you know it, but China is on the telephone with questions about the U.S. government's solvency.

Depending upon how the bill is crafted, Obama could attract quite a few Republicans in the House to go along. Blue Dog Democrats, for whom spending sometimes seem to be the only issue they ever write home about, are on board, of course. The Senate, in recent years, has found it tough to adhere to the principles of PayGo; the yearly Alternative Minimum Tax fix, which has political benefits too, violates statutory PayGo (the Senate voted 88 to 5 to do this in 2007), as did the Senate's decision to save doctors from seeing their Medicare reimbursement fees drop. House Democrats had insisted on a revenue-neutral AMT fix (easier said than done). 

Two weeks ago, Speaker Nancy Pelosi and Majority Leader Steny Hoyer warned the House's members of the budget conference committee not to accept the Senate Democratic versions of middle-income tax cuts, the estate tax repeal, the AMT fix and the Medicare rate fix "unless these conference reports or bills include statutory PAYGO, the bills are fully offset under traditional scorekeeping, or statutory PAYGO has already been enacted into the law." The House isn't entirely blameless; it's fairly easy to create the impression of PAYGO savings without achieving them, something conservatives have been pointing out ever since Democrats promised to follow PayGo principles.  But the Senate is the larger culprit.

The big political question: will Senate Democrats follow their president's lead?