Obama calls lawmakers to White House in effort to break debt stalemate

Republicans, however, are refusing to raise the debt ceiling unless the increase is accompanied by spending cuts of an equal amount. In bipartisan talks led by Vice President Biden, negotiators had identified more than $1 trillion in savings before Republicans pulled the plug on June 23, declaring an impasse over the issue of taxes.

On Tuesday, a GOP aide familiar with the talks put the numbers even higher, saying the two sides had agreed on as much as $2.3 trillion in potential savings, including more than $300 billion in interest payments averted through lower borrowing. That would match the amount needed to cut a long-term deal.

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Running in the red

Part 1: How the U.S. detoured to massive debt

But serious hurdles block the path forward. Republicans, for example, have refused to agree to Democratic demands for a “firewall” between defense and non-defense spending that would distribute the pain broadly across government, hitting the military as well as domestic agencies. And while Democrats have offered to reduce spending on government health programs as long as the reductions do not affect benefits, Republicans have been adamantly opposed even to eliminating tax breaks that are unpopular among Republicans.

Since the talks broke down, some lawmakers in both parties have expressed doubts about their ability to negotiate, draft and approve such a momentous package of spending cuts and revenue increases in the dwindling time that remains. That has fueled talk of a short-term extension of the debt limit that would permit the Treasury to cover the bills for a few more months while discussions continue.

On Sunday, Sen. John Cornyn (R-Tex.) issued the latest call for a “mini-deal.” Cornyn, who is in charge of 2012 Republican Senate campaign strategy, said, “We’ll take the savings we can get now, and we will re-litigate this as we get closer to the election.”

Many lawmakers are loathe to defer a decision on the debt until next year, however, because that would force them to take another unpopular vote to raise the debt limit within months of facing voters. Such a vote could prove devastating to as many as a dozen vulnerable Senate Democrats, and Senate Minority Leader Mitch McConnell (R-Ky.), who stands to gain control of the Senate in the 2012 elections, has been perhaps the most persistent advocate of a short-term deal.

House Republicans would also be vulnerable, and Boehner has said he wants a long-term deal.

Obama weighed in Tuesday, noting that a remarkable bipartisan consensus has emerged about the scope and severity of the nation’s debt problem. “Most of us already agree that to truly solve our deficit problem, we need to find trillions in savings over the next decade, and significantly more in the decades that follow,” he said. “And that’s the kind of substantial progress that we should be aiming for here.”

Staff writers Peter Wallsten, Felicia Sonmez, Rosalind S. Helderman and Paul Kane contributed to this report.

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