WASHINGTON, D.C. (USA Today) - A divided Republican House passed the Senate's "fiscal cliff" agreement Tuesday night, following a tense day of GOP protests that the plan does not do enough to rein in federal spending.
President Obama lauded the vote, saying it averts a series of tax hikes and spending cuts that could have plunged the nation back into recession.
Obama also said the deal is "just in step" in a comprehensive effort to reduce the nation's debt, and that he had wanted a larger agreement. "That failure comes with a cost."
Obama, who pledged to reduce the national debt in part by raising taxes on the wealthy, said he would continue efforts to reduce the federal debt while investing in the nation's economic development.
Appearing with Obama: Vice President Joe Biden, a key negotiator in last-minute fiscal cliff talks.
Immediately after his comments, the White House announced that Obama would fly overnight to Hawaii to re-join his family on their end-of-year vacation. Obama had returned to Washington from Hawaii on Thursday for fiscal cliff talks.
House Democrats provide the winning margin for the plan that stopped the fiscal cliff which technically took effect Tuesday with the new year.
Opponents said the plan's two-month delay of major spending cuts only sets up more budget battles in the weeks to come, as the nation bumps up against its $16.394 trillion debt ceiling.
For his part, Obama said the debt ceiling should not threaten future budget deals, saying the limit must be raised because "we can't not pay bills that we've already incurred."
Earlier in the evening, House Republicans could not muster enough support to add spending cuts to the bill that the Senate passed in the early morning hours of Tuesday. So GOP leaders put the Senate bill on the House floor as is.
House Democratic leader Nancy Pelosi, D-Cal. said that while the plan doesn't do everything many people want, "it is a good way for us to have a happy start to a new year."
House Speaker John Boehner, R-Ohio, and other Republican leaders - who at one time vowed to block any increase in taxes - did not speak during the debate.
The fiscal cliff legislation raises tax rates on incomes over $400,000 for individuals and $450,000 for couples, while retaining the George W. Bush-era tax cuts for Americans with lower incomes. It also features an extension of unemployment insurance..
One set of taxes is going up in 2013, however: The deal does not address the temporary payroll tax holiday that expired Tuesday. That tax is rising by 2 percentage points, back to its 2010 level.
Republican criticism of the Senate plan surfaced during a closed-door meeting hosted by House Speaker John Boehner, R-Ohio, and House Majority Leader Eric Cantor, R-Va.
"The lack of spending cuts in the Senate bill was a universal concern amongst members in today's meeting," said Boehner spokesman Brendan Buck.
Cantor actually told colleagues he opposed the Senate bill, His statement was an early warning sign the Senate-passed bill faced problems in the House. House GOP leaders met throughout the day Tuesday in to come up with a plan on how to proceed.
After an early evening meeting of the Republican caucus, Rep. Scott Garrett, R-N.J., said there were two options for Republicans: continue with the Senate bill or amend it. "To the credit of leadership they are trying to get a sense of where we as a conference are on this," he said.
Amending the agreement would have thrown the whole deal into question as the Senate has already overwhelmingly approved the bill. The House also faced a noon Thursday deadline before the next Congress is sworn in - erasing all prior action and leaving Congress to start anew with roughly 100 new lawmakers entering the House and Senate.
Had the House not acted, President Obama and other Democrats have made clear they would blame the Republicans for the string of tax increases and defense and social cuts that come with it.
Rep. John Fleming, R-La., said members were concerned about rattling financial markets or being blamed for going over the cliff. Republicans were also coalescing around the idea to battle over spending cuts in upcoming budget fights, including a brewing February battle to raise the debt ceiling.
"Now the topic will be spending cuts," he said.
Earlier in the day, Vice President Biden returned to Capitol Hill to huddle with House Democrats, seeking to build support for the Senate proposal.
Biden attended a meeting of the House Democratic Caucus that stretched for three hours on Tuesday, outlining the details and addressing concerns from skeptical Democrats. Later, Biden expressed confidence about the fate of the Senate bill as he left the White House for a meatball-and-provolone sandwich at Potbelly's. "I think we're going to be OK," Biden said to a CNN camera crew nearby.
House Minority Leader Pelosi, D-Calif., said given the "uncharacteristically, very strong bipartisan" vote in the Senate, Republicans should move to schedule an up-or-down vote on the measure.