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Debt Ceiling Debate Begins

By COREY BOLES

The Senate voted Thursday to wind down the Treasury's financial-market bailout plan as part a broader bill that would raise the government's debt ceiling, but the 53-40 tally serves only as a symbolic show of disapproval because a Senate rule requires 60 votes to pass any amendments to the legislation.

The proposal was the first of a series Republicans plan to offer as the Senate debates a bill to increase the amount of debt the government can issue by $1.9 trillion to $14.3 trillion.

The move to wind down the government's $700 billion Troubled Asset Relief Program, or TARP, was sponsored by Sen. John Thune and drew support from 13 Democrats along with all 40 Republicans. The South Dakota Republican called for using unspent bailout funds to reduce the federal budget deficit.

The Democratic leadership opposed the amendment, saying it would handcuff Treasury Secretary Timothy Geithner's efforts to ensure the stability of financial markets. The Obama administration last week said it would recoup any taxpayer losses incurred as a result of the Wall Street bail out, and has proposed a tax on financial institutions that would raise around $90 billion over the next decade to help cover TARP costs.

Sen. Christopher Dodd, who voted against the amendment, said TARP funds should be used to make loans to small businesses struggling to tap the commercial-credit markets. The Connecticut Democrat said there is approximately $320 billion of unspent TARP money that could be at least partly used to stimulate private-sector job growth.

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