OMB Watch released a statement yesterday afternoon harshly criticizing the Democratically control Congress and the president for abandoning fiscal responsibility in the final hours of 2007 after they entire year was spent adhering to or attempting to adhere to righting our nation's fiscal course. From the statement:

Adding insult to a year of fiscal policy injuries, Congress has abandoned fiscal responsibility by waiving pay-as-you-go (PAYGO) rules in order to pass a one-year patch to the alternative minimum tax (AMT) without offsets. This tax cut adds another $50 billion to an already expanding deficit next year, and will give fewer options for our children and grandchildren to seek solutions to the problems of tomorrow.

While I expect as much from President Bush, this is a huge disappointment from the new Democratic majority in Congress whose number one promise was to uphold pay-as-you-go (PAYGO) rules. So much for promises:

This vote is particularly disappointing as Democrats have gone to great lengths this year to comply with PAYGO rules, particularly on spending. From student loan reforms to expansions of the State Children's Health Insurance Program and Food Stamps, Democrats have negotiated the turbulent fiscal waters of the federal budget responsibly, diligently, even courageously. That is why at this point, after all that work and sacrifice, the compromises and the concessions needed to construct balanced solutions to the AMT problem, it is unacceptable for them to abandon their stated principles of fiscal responsibility because they fear Americans will not accept paying up front for the services and benefits the country demands.

As the statement makes clear, there is plenty of blame to go around in Washington for this policy failure. What an awful way to end 2007.

Moments before the last rites were performed this afternoon on PAYGO following a 352-64 vote in favor of an un-paid-for AMT patch, House Speaker Nancy Pelosi promised that it would be revived next year, saying offsets would be found retroactively for the cost of this year's AMT patch before Congress moves forward on a tax extenders and AMT package next year.

Next year? Why should anything be any different next year? Good luck cashing that promissory note -- that's one thing that is never intended to be collected.

The routine matter of passing a resolution to adjourn Congress for the session is getting caught up in the effort to pay for the AMT patch bill.

The adjournment resolution, H Con Res 271, failed by a 184-218 vote yesterday, with members of the Democrats' Blue Dog Coalition using the vote to draw attention to the PAYGO principles, which the Senate violated last week in approving an AMT patch bill without any offset provisions, a move that would add a $50 billion hole to the deficit next year.

In the end, the House won't hold the holidays hostage to PAYGO principles, but the Blue Dogs and others advocating fiscal responsibility won't make it easy for the House to follow the Senate down the deficit hole.

In "Budget Gridlock Is a Shameful Legacy for Bush and Many Others," in today's Roll Call, leading congressional scholar Norman Orenstein bemoans the shrinking center in Congress and its impact on budget policy, as expressed in the current AMT and budget debates.

Orenstein fingers the GOP for the fix we're in on AMT, sacrificing PAYGO on its altar and having to fix it at all:

Republicans had many opportunities to fix the AMT when they were in the majority, and instead chose their own year-to-year Band-Aids, because they did not want to tell the American people the truth about the long-term budget drain the fix would entail. That was the same reason they pulled a bait and switch on the big package of tax cuts, deliberately having them all expire after 10 years to mask the costs, then trying to extend them by calling inaction a tax increase.

But Norm, you seem to have forgeten the Cheney Axiom, that Deficits Don't Matter to the GOP, which explains

the even more outrageous and irresponsible behavior of the president on the appropriations bills — vowing to veto the latest version of a bipartisan compromise before it was accomplished, showing no interest in working in divided government across party lines, drawing lines in the sand over $11 billion out of a $3 trillion budget. Of course, $11 billion is real money, but this has nothing to do with the numbers or with fiscal responsibility.

Bush Sr. had some notion of serving as a steward of government. By contrast, Jr. is a kleptocrat, pilfering public goods and distributing them to buds and cronies through contracts and tax cuts. So much self-dealing to do, so little time ... to care about deficits.

This weekend, the Washington Post editorialized on what it deems "A Bad Patch," the bill moving through Congress to "patch" the Alternative Minimum Tax (AMT). Congress has taken pains to make sure all of its measures this year that raise mandatory spending or cut taxes are revenue-neutral, to comply with the fiscal discipline requirements of the "PAYGO" rules Congress passed this year.

But the Senate dropped the PAYGO ball completely last week, voting 88-5 to pass an un-paid-for patch -- of which 85 percent of the benefit goes to those earning $100,000 or more, incidentally:

Republicans -- who might as well rename themselves the Grand Old Party of Fiscal Irresponsibility -- refuse to pay the $50 billion tab for the one-year fix. They refuse to do away with the "carried interest" loophole that lets venture capitalists and hedge fund operators pay lower capital gains rates on ordinary income, and they refuse to countenance any other method.

The editorial fixes attention on the House Democrats' next move, with the "patch" ball now in their court. At a meeting with the Post editorial board on Friday, House Majority Leader Steny H. Hoyer (D-MD) "was refreshingly frank about the trade-off involved... Asked why Democrats shouldn't be criticized for this choice, Mr. Hoyer said, 'I think you are right to rake us over the coals for passing an unpaid-for AMT.'"

The Senate's PAYGO rules require a point of order to be raised in objection to any legislation that violates PAYGO. No such point of order was raised during the lengthy Senate debate last week. The House rules are different; a waiver vote must occur before any legislation that breaches the PAYGO rules can be voted upon by the House.

We at OMB Watch, and, we suspect, the House Blue Dogs -- who wrote a letter to Senate leaders last Tuesday saying "Waiving PAYGO rules in the face of tough decisions and political pressure is fiscally reckless, an abdication of our duties, and frankly, a broken promise" -- will be watching carefully this week.

In an attempt to have people pay attention to the issue of the national debt, a recent Associated Press article lead with the eye-catching headline of "National Debt Grows $1 Million a Minute." Wow! $1,000,000.00 a minute! That's quite a bit of cash.