A planned vote has been put off from Wednesday following a report from the Congressional Budget Office that the proposal would cut federal spending by $850 billion over 10 years, The New York Times reported. Speaker of the House John Boehner, R-Ohio, was also dealing Tuesday with lack of support for the plan among several conservative members of the House.
After Boehner and President Barack Obama delivered competing televised statements Monday staking out differing sides of the debate, the House speaker pressed ahead with a call for a House vote Wednesday on his "two-stage" plan to raise the debt ceiling in concert with more than $1 trillion in budget cuts, The Washington Post reported. He had also sought to keep on track a Thursday vote on a balanced budget amendment to the Constitution.
Earlier Tuesday, House Majority Leader Eric Cantor, R-Va., told freshmen Tea Party Republicans to stop "whining" about any deal that would include an increase in the debt ceiling, a necessary move to avoid default on U.S. government debt.
U.S. Senate Majority Leader Harry Reid, D-Nav., said Tuesday the Democratic caucus will reach out to Republicans, encouraging them to support his own debt-ceiling plan.
"The Senate plan is a reasonable middle ground," Reid said after the closed-door policy luncheon. "Democrats support it because it protects the middle class. It prevents damaging cuts to Social Security, Medicare and Medicaid. Republicans should support it because it contains the two things they've asked for all along: It does not contain revenues and the amount of cut meets the amount of the debt ceiling increase."
On the Senate floor, Reid said his plan, revealed Monday, would avert a default while cutting $2.7 trillion from the deficit in the next 10 years, includes no revenues, establishes a congressional committee to look for more savings and "holds harmless even the most wasteful of tax breaks and giveaways to big oil and billionaires, who Republicans have vowed to protect even if it costs our economy in the process."
After the caucus luncheon, Reid said Standard & Poor's rating agency said, "our plan would avoid a downgrading of our credit rating, and, conversely, Speaker Boehner's plan would cause a downgrading."
As Reid talked up his plan Tuesday, Boehner and Cantor sought to whip up support among House Republicans for Boehner's plan that would authorize up to $1 trillion in new debt in exchange for $1.2 trillion in spending cuts and the promise of more cuts in the future. It also would revisit raising the debt ceiling in six months.
Reid said Boehner's plan was written for Tea Party activists in the House and would be "dead on arrival" in the Senate if it passes the House -- right now not a sure thing.
"That's why I hope my Republican colleagues will think long and hard about what direction they want to move," Reid said. "They can either support the Tea Party and their plan, which has no chance of passing, or they can work with us to forge a responsible approach."
Reid said there were "further discussions going on right now" behind the scenes, adding, "I'm open for compromise."
During the daily briefing, White House press secretary Jay Carney reiterated Obama's position that he would veto the Boehner bill if it reaches his desk. Obama didn't threaten a veto during his remarks Monday.
"That position hasn't changed," Carney said. "It is, however, moot, because as the president made clear last night, we're in a stalemate. … [We] need Congress to produce something that is a compromise and that, therefore, can get support from Democrats and Republicans in both houses and reach the president's desk and meet the president's approval. That's why we need compromise."
Carney said the Aug. 2 deadline is very real.
"That's not a guess. That's not a political opinion. It is the judgment of career analysts at the Treasury Department," he said. "Beyond that date, we lose our capacity to borrow. We give up our borrowing authority without action by Congress. And the result of that risks default for the United States for the first time in our history, as we face the reality that we take in only 60 cents for every dollar we owe."
He said Treasury Department officials were talking with the Office of Management and Budget, the Federal Reserve Bank and others "to work through how we would manage this impossible situation, this impossible position."
Treasury Department officials have identified steps they can use to keep paying bills for about a week past the Aug. 2 deadline, the Times reported Tuesday.
Carney expressed optimism that "action will be taken by Congress" to ensure the nation doesn't default on its obligations.
International Monetary Fund Chief Christine Lagarde, speaking in New York at the Council on Foreign relations, urged the U.S. Congress to reach a compromise that would avoid default and the ensuing interest rate increases that would result from a downgrade of U.S. government debt.
Cantor praised Boehner's leadership and acknowledged that "the debt-limit vote sucks," the source told The Hill. But the Virginia Republican said House members faced three choices -- allow the country to default Aug. 2, pass a Senate bill Boehner denounced Monday as "full of gimmicks" or support the GOP leadership and "call the president's bluff."
In a media availability after the caucus meeting, Boehner defended his proposal but didn't guarantee its passage.
"I do think we're going to have some work to do to get it passed, but I think we can do it," he said.