July 25th, 2011
10:34 AM ET

Boehner, Reid to unveil new debt plans

Democratic and Republican congressional leaders are set to unveil new deficit reduction plans Monday as top officials scramble to bridge a cavernous partisan divide and raise the federal government's debt ceiling before an unprecedented - and potentially devastating - national default.

Senate Majority Leader Harry Reid, D-Nevada, is expected to outline a blueprint calling for roughly $2.7 trillion in spending cuts over the next decade while raising the debt limit by $2.4 trillion - an amount sufficient to fund the government through the 2012 election. Reid's plan would not require any new tax hikes or reforms to politically popular entitlement programs.

House Speaker John Boehner, R-Ohio, is expected to outline a two-stage plan. The first stage calls for approximately $1 trillion in spending cuts while raising the debt ceiling through the end of 2011, according to sources. The second stage would raise the debt limit through 2012, but tie the increase to major tax reforms and entitlement changes outlined by a special commission.

Democrats are vehemently opposed to the idea of holding more than one vote to the raise the debt limit through the 2012 election, arguing that such a requirement is politically unrealistic and could prove to be economically destabilizing. Republicans want to lock in long-term tax and spending changes, and argue that President Barack Obama is trying to avoid politically tough decisions in a presidential election year.

If Congress fails to raise the $14.3 trillion debt limit by August 2, Americans could face rising interest rates and a declining dollar, among other problems. As the cost of borrowing rises, individual mortgages, car loans, and student loans could become significantly more expensive.

soundoff (44 Responses)
  1. Tommy1414

    Scottish Mama- Please – Healthcare ACT has already kicked in – just not in full as planned for 2014. Many of the tenants therein have already been implemented. As for whos responsible for the recession/depression . Look no further than the libs who were running Fanny and Freddie – one of the main reasons why we are in the mess we are in – Can you say HUD?. Even the esteemed fmr President Clinton has admitted as much – and that was on his watch. And oh yes – when the Republicans wanted oversight of Fannie and Freddie – it was shot down in the last two terms ( DEM Senate and House) of the Bush Adm.. And only after the mess hit did you get folks like Sen Barney Frank claim that there should be oversight (whilst he voted it down two years before).

    July 25, 2011 at 1:08 pm | Report abuse |
    • Scottish Mama

      Yeah, former President Clinton enacted with republican senate and congress a plan to have poor people able to afford homes. Former President Bush further deregulated Banks. I did not see any hud homes being foreclosed on it was middle class sold loans, deregulated by Bush.

      July 25, 2011 at 1:42 pm | Report abuse |
    • Scottish Mama

      President Clinton paid off Bush 1 wars and gave his son Bush W. clean slate to work with. In a supposedly wonderful economy Bush W. raised the debt ceiling 6x. Now we have to spend money to get out, the republicans want fiscal responibility? Bush W. decided to go to war for oil and outed Mr. Wilsons wife, Valerie plame because he said there was no weapons of mass destruction. Proven true no weapons.

      July 25, 2011 at 1:49 pm | Report abuse |
    • Scottish Mama

      Actually it was Barney that wrote the legislation for regulation on banks,during the Dem house and senate and they said he did not go far enough. Republicans had the house and senate for 6 years and did nothing but deregulate banks. When President Obama was under the impression he was getting a deficit and not a depression sized ecomomy, Bush W. knew in May of 2008 and noone knew about it till Aug. and then all of a sudden Sept and oct we need to move on it, we have to throw money at the banks, without oversight and payback plan.

      July 25, 2011 at 1:59 pm | Report abuse |
  2. Tommy1414

    Again – here we go with Dem Libs blaming everyone else. When the President ran – he said he would reduce the deficit – Instead it's doubled ( and they cant even account for where the stimulus money went – that is un-acceptable) . When he ran, he said he would reduce unemployment – thats gone through the roof. He knew the issues going in (wether you blame past administrations or not) and he hasn't done a darn thing to fix it. I don't even see us heading in the right direction – which would at minimum be acceptable. But its NOT happening people. We need Hope and Change – I hope that we change this President soon..

    July 25, 2011 at 1:14 pm | Report abuse |
    • Scottish Mama

      Waahhhhh. It is hard when the purse strings are held by the republican right Tea Party two faced cry baby hostage debters thugs. So as I say or I am going home. Tea Party one term,Wisonsin knows, yu will see it across america, republicans are done, and if Dems do not get it together for the middle class, they will be next.

      July 25, 2011 at 2:06 pm | Report abuse |
  3. s kel

    to all on here but republicans(dont want to see or hear the truth about tea party and congressinal republican trash) you cannot explain too, reason with or even have a two sided conversation with. They are blind and hateful people. Just laugh at their attempts of their verison of the facts (fox news, lol rupert murdoc owned, yeah thats a unbiased truthful media, lol). Ignore what they say.

    July 25, 2011 at 1:56 pm | Report abuse |
    • Scottish Mama

      k mom, I never get to do nothin'.(smiley face)

      July 25, 2011 at 2:45 pm | Report abuse |
  4. jimmy

    my weeenie feels funny

    July 25, 2011 at 1:58 pm | Report abuse |
  5. golferdude007

    We need to guarantee people what they actually contributed to pay for Social Security and Medicare. Which is less than half of what these programs actually cost us. I will always recall my mother saying: "We old people paid for this, we deserve it"! When I tried to tell her she did not pay for anything close to what she was receiving she went nuts!
    We should also revisit Bush's proposal to let people invest their own social security. As this budget bust looms, Social Security is filled up with worthless paper...US Government Treasury Bonds! Can't eat em, can't spend them. As one democratic senator said: "Those social security Bonds are the safest investment on the planet". Yeah sure Senator (and Mr. President)!!
    That would make people realize they have to put more away for retirement and they can not count on the damned Government.
    btw I have been watching a little CNN lately, and thought their bias was at least subsiding. Until today. Some cute dim wit young gal about 8:30 East coast time said: "WELL WITH 38% (its really 42%) OF WHAT THE FEDERAL GOVERNMENT SPENDS HAVING TO BE BORROWED" (next I was expecting her to say...'well we can't keep this up – we have to stop spending more and more than we take in) – but she said – spoken like a college girl that was given a credit card by her parents but never had to earn anything to pay it back – "WE HAVE TO INCREASE THE DEBT CEILING TO BORROW MORE! WHAT ARE THE REPUBLICANS THINKING?"!
    God help us. And the new managers at CNN ought to get her off the air. What a dear in headlights view of how and why we have this much debt!

    July 25, 2011 at 2:07 pm | Report abuse |
  6. Tommy1414

    You do realize that proportionately speaking the amount of money spent (without TARP, stimulus etc) in this administration far exceeds that of prior administrations. And last I checked – it still hasnt gotten us anywhere except in more debt. and again – same old story – blame the other administration.

    July 25, 2011 at 2:25 pm | Report abuse |
    • Scottish Mama

      Your dogs better than my dog, your dogs eat better than mine, your dog eats middle class, my dog eats wealthy people, so he eats better than mine.

      July 25, 2011 at 3:24 pm | Report abuse |
  7. jimmy

    and doodoo. i blame doodoo. it doesnt fuss back.

    July 25, 2011 at 2:36 pm | Report abuse |
  8. GD

    That SS trust fund is not in place so ignorant politicos can try to pay back debt that they caused!
    Quit dipping into the people's money. Politicians bleed us dry enough.

    July 25, 2011 at 4:23 pm | Report abuse |
  9. GD

    Tommy, isn't that what you're doing right now? Hypocrite!

    July 25, 2011 at 4:25 pm | Report abuse |
  10. Melissa

    Enough! This president had SENATE, CONGRESS, AND WHITE HOUSE DEMOCRAT and spent, spent, spent! Now that Republicans have control of the congress and don't want him to SPEND SPEND SPEND they are called traitors? Come on people! Has reality not hit you all yet!? Blaming Bush's wars for Obama's debt?! Didn't Obama say he was going to get us out of war then start another in Libya? I wish you all a nice reality check, cause when inflation hits like it did in the 70s, you're going to get one!

    July 26, 2011 at 2:20 am | Report abuse |
  11. Melissa

    One person here defending the spending please tell me why?: why do you think the country should continue to spend money we don't have? We don't have it, period. What else is there to say? If you don't have money you don't keep spending it! If you're complaining about the wars costing money please contact your president and tell him to bring the troops home!

    July 26, 2011 at 2:23 am | Report abuse |
  12. Melissa

    President Clinton had a balanced budget, he did not have 0 DEBT! There is a difference between spending what you have and paying off your debt. President Clinton did not pay off the debt, he just didn't spend more than he had. Do you people balance your own checkbooks? Apparently not!

    July 26, 2011 at 2:26 am | Report abuse |
  13. Partisan

    People seriously need to get their heads out of their posteriors when it comes to "Democrats this!" and "Republicans that!" in regards to blind hate towards "The other guys" just because they aren't "your side".

    Judge politicians by their actions, not their affiliations and certainly not their words. Ever since obama has been elected, things have continued to get worse with no sign of improvement in sight. You can only blame so much on the previous administration.

    July 28, 2011 at 1:36 pm | Report abuse |
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