“If we can’t do the biggest deal possible, then let’s still be ambitious. Let’s still try to at least get a down payment on deficit reduction,” Obama said at a White House news conference.
White House Chief of Staff William M. Daley and Treasury Secretary Timothy F. Geithner met Friday in the Capitol with House Speaker John A. Boehner (R-Ohio) and House Majority Leader Eric Cantor (R-Va.). According to a Democratic lawmaker and Democratic and GOP aides briefed on the meeting, the officials discussed whether some portions of the “big deal” — which originally included major overhauls to the tax code and entitlement benefits — could be included in the Senate plan. GOP leaders rejected Obama’s previous offering because it calls for a net increase in tax revenue approaching $1 trillion.
But most congressional and administration officials focused instead on drafting a Senate-driven deal that could win bipartisan support in both chambers, with first steps possibly coming in the middle of next week.
The Senate effort, led by Majority Leader Harry M. Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.), would allow Obama to increase the debt limit three times between now and the end of next year. Congress could block the president only with a two-thirds majority.
A special House-Senate committee would also be formed to propose potentially far-reaching reforms to the tax code and entitlement programs, such as Social Security and Medicare. Eventually, aides said, the House would amend that package to include nearly $1.5 trillion in spending cuts over the next 10 years.
If the entire package comes together, it will also cover budget levels for the next two fiscal years that provide immediate savings — eliminating almost any chance of a federal government shutdown.
To clear all the parliamentary hurdles and enact the legislation by early August, congressional officials expect Reid to introduce legislation on the Senate package by Wednesday night.
“We are obviously running out of time,” Obama said Friday. “And so what I’ve said to the members of Congress is that you need, over the next 24 to 36 hours, to give me some sense of what your plan is to get the debt ceiling raised through whatever mechanisms they can think about.”
In the House, however, dozens of conservative Republicans have vowed not to support any increase in the debt limit unless it is accompanied by legislation — known as the Cut, Cap, Balance Act — that sets strict caps on future spending and sends a constitutional amendment requiring a balanced budget to the states for ratification.