President Barack Obama hailed the House on Thursday for passing a measure establishing pay-as-you-go rules for Congress.

Obama praised the House for passing the "PAYGO" rule, which will require all new spending to be offset by tax hikes or spending cuts.

"Statutory PAYGO would hold us to a simple but bedrock principle: Congress can only spend a dollar if it saves a dollar elsewhere," Obama said in a statement. "Mandatory spending increases and tax cuts must be paid for; they're not free, and borrowing to finance them is not a sustainable long-term policy."

The House passed PAYGO Thursday afternoon in a 233-187 vote, which saw all voting Republicans and 15 Democrats oppose the rule.

Obama's push for PAYGO has been one of several elements of a deficit reduction effort. Obama has also announced a three-year freeze on non-defense discretionary spending, and pushed for a congressionally-passed panel in charge of deficit reduction. The Senate shot down such a proposal, and Obama has said he'll create a similar panel with an executive order if needed.

Obama said that restoration of PAYGO would mean less severe deficits in the future.

"It is no coincidence that when we last had statutory PAYGO, during the 1990s, we turned deficits into surpluses," he said. "The passage of statutory PAYGO today will help usher out an era of irresponsibility and begin putting the country back on a fiscally sustainable path."