January 27, 2009 / 11:20 PM / 11 years ago

Democratic fiscal hawks win Obama budget pledge

WASHINGTON, Jan 27 (Reuters) - A bloc of fiscally conservative Democrats on Tuesday won a commitment from President Barack Obama’s administration for efforts to balance the government’s checkbook, enabling many of them to support the economic stimulus plan.

A day before the House of Representatives votes on the $825 billion stimulus package, Obama’s budget director, Peter Orszag, said the government must eventually get back to paying for non-emergency spending without boosting the deficit.

“We need to return the fiscal responsibility and pay-as-you-go budgeting that we had in the 1990’s for all non-emergency spending,” Orszag said in a letter to Congress.

“The president and his economic team look forward to working with the Congress to develop budget enforcement rules that are based on the tools that helped create the surpluses of a decade ago,” he said in the letter.

The bloc, known as the Blue Dog Democrats, had sought in meetings with Obama aides a commitment that the new president would work to ensure the burgeoning budget deficit is not further bloated by increases in mandatory government spending programs, like Social Security and Medicare, or by tax cuts.

Without such a commitment, the 50-member group had held back their support for the huge stimulus plan aimed at helping to lift the economy out of a recession that has already lasted year.

Orszag’s letter appeared to win many of them over.

“After years of reckless deficit spending, the members of the Blue Dog Coalition are very encouraged to see that our new administration is serious about bringing responsibility and accountability to the federal government,” said Rep. Charlie Melancon, a co-chairman of the Blue Dog group.

The Louisiana Democrat said Orszag’s letter was “a clear and direct signal that President Obama is willing to make the tough decisions necessary to put our country back on a path to fiscal responsibility.”

The Blue Dog demand came as budget experts forecast the federal deficit will hit $1.2 trillion for fiscal 2009, which ends on Sept. 30. That does not include the stimulus package.

The current national debt is about $10.56 trillion, almost doubling since Sept. 30, 2000. (Reporting by Jeremy Pelofsky, editing by Patricia Zengerle and Chris Wilson)

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