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Debt debate: Where things stand
The federal government has three days left to raise the nation's current $14.3 trillion debt ceiling, the Treasury Department said. Failure to do so will risk an unprecedented national default.
If the debt ceiling is not raised by Tuesday, 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. Some financial experts have warned of a downgrade of America's triple-A credit rating and a potential stock market crash.
Without an increase in the debt limit, the federal government will not be able to pay all of its bills next month. President Barack Obama recently indicated he can't guarantee Social Security checks will be mailed out on time. Other critical government programs could be endangered as well.
Where do things stand in the fight to raise the debt ceiling?
Senate
Senate Majority Leader Harry Reid, D-Nevada, temporarily stopped legislative consideration of his debt ceiling proposal late Saturday night, reversing an earlier decision to hold a key procedural vote on the measure by 1 a.m. ET Sunday.
Negotiations were still underway at the White House, Reid said. The vote will now be held at 1 p.m. ET on Sunday.
There are "many elements to be finalized" and still "a distance to go," Reid said. "We should give everyone as much room as possible to do their work."
The announcement comes a few hours after Reid denied claims from House Speaker John Boehner, R-Ohio, that progress was being made on a debt ceiling deal.
The Republicans "refuse to negotiate in good faith," Reid said. "The process has not been moved forward during this day."
The Democratic-led Senate on Friday blocked the Boehner plan from being considered, voting 59-41 to table the measure.
Under an amended version, it would reduce federal deficits over the next decade by $2.4 trillion while raising the debt ceiling by a similar amount - meeting the GOP's demand that total savings should at least equal any total debt ceiling hike.
Roughly $1 trillion in the savings are based on the planned U.S. withdrawals from military engagements in Afghanistan and Iraq.
Reid's plan also would establish a congressional committee made up of 12 House and Senate members to consider additional options for debt reduction. The committee's proposals would be guaranteed a Senate vote with no amendments by the end of this year.
In addition, it incorporates a process proposed by Senate Minority Leader Mitch McConnell, R-Kentucky, that would give Obama the authority to raise the debt ceiling in two steps while providing Congress the opportunity to vote its disapproval.
House
House Speaker John Boehner expressed optimism Saturday that an agreement is near, despite the House's rejection of a plan proposed by Senate Majority Leader Harry Reid.
"In spite of our differences, we're dealing with reasonable, responsible people," Boehner said.
Senate Minority Leader Mitch McConnell, R-Kentucky, also said Saturday afternoon that he had talked to President Barack Obama and Vice President Joe Biden "within the last hour" and is "confident and optimistic" that there will be an "agreement within the very near future."
Earlier Saturday, the Republican-controlled House of Representatives rejected Reid's proposed debt ceiling plan in a sharply polarized 173-246 vote. Republicans unanimously opposed the measure while most Democrats backed it. GOP leaders conducted the vote on Reid's bill under rules requiring a two-thirds majority for passage, thereby ensuring its defeat.
The Republican-controlled House on Friday passed a proposal put forward by House Speaker John Boehner, R-Ohio, that seeks to raise the debt ceiling and cut government spending while requiring that Congress pass a balanced-budget amendment to the U.S. Constitution. The 218-210 vote was strictly on party lines. The vote had been scheduled to occur Thursday night, but Republican leaders postponed it because they lacked support within their own caucus to get it passed. After the House vote, the measure went to the Senate, where Democrats blocked it from being considered.
Boehner's plan calls for $917 billion in savings over the next decade, while creating a special congressional committee to recommend additional savings of $1.6 trillion or more. It would allow the debt ceiling to be increased by a total of roughly $2.5 trillion through two separate votes. The $2.5 trillion total would be enough to fund the federal government through the end of 2012.
The plan originally called for a congressional vote on a balanced-budget amendment to the Constitution by the end of the year. Boehner then reached out to disgruntled conservatives by amending the plan to require congressional passage of such an amendment as a condition for raising the debt limit by the full $2.5 trillion.
President Obama
Obama has endorsed Reid's plan and threatened a veto of Boehner's plan. The president strongly opposes any bill that doesn't raise the debt ceiling through the 2012 election, and he has promised to veto any short-term debt ceiling extension unless it paves the way for a "grand bargain" of more sweeping reforms and revenue increases.
On Friday, Obama urged Senate Democrats and Republicans to take the lead in congressional negotiations. He said the House GOP plan "has no chance of becoming law." Obama also urged Americans to keep contacting members of Congress in order "to keep the pressure on Washington."
The president made a nationally televised plea for compromise Monday night, though he also criticized Republicans for opposing any tax hikes on the wealthy.
No face-to-face negotiations are currently scheduled for Saturday.
Unfortunately Peggy- what makes sense is not the objective!!! 🙁
You know, its funny- it seems to CNN that overspending is only bad when a Republican does it. There is no intellectual honesty with this network.
CNN should be renamed to CCN – Cable Campaign Network. They campaign for the Democrats instead of reporting news.
Until politicians are held accountible for the countrys pain that so many of the middle class is going thru we will be at there mercy we need to remove tbeze people out of office most of them are lawyers anyway so they dont know what the poor or middle class is going thru
Hungry people don't stay hungry for long! Go ahead and cut school loans, social security, food stamps, military pay, etc. and see where that gets you...rich white tea baggers. Give the middle class and the poor a reason to drive you and your families from OUR COUNTRY. I would rather live in the old Soviet Union then a country where 1% of the population gets rich off the back of the other 99%. Better we all be poor.
Start packing!!
The top 40 richest Americans made $300M each last year and while they paid 16% in taxes, THAT'S STILL $48M each. They are not the problem. The problem is the 48% that pay NOTHING!
Oh Danny......there is not a man, woman or child in this country that pays nothing in taxes. Your argument is old and tired and you should put it to bed. The VAST majority of state and local taxes are paid by those considered middleclass and poor. Those taxes go to upkeep on our infrastructure and for services we ALL depend on. All people who work pay into SS and Medicare.
Ponganse. Trabajar; democrats and republicans, que ustedes no se mandan solos acuerdensen de que el pueblo los eliguio y ustedes trabajan para el pueblo de los Estados Unidos de NorteA$merica
Why don't we just do away with the debt ceiling? Only one other country in the world has one. Or raise it to some ridiculously high number so we don't ever have to worry about it again? Then we could spend our way to prosperity.
I am on disability and realize I may not get my check on tuesday. How ever I also get if we don't do something the whole thing will go bust and wont get it anyway. The 200 billion in revenue the govt takes in each month is enough to payout the interest on the debt, ss, ssd, unemployment, and our soldiers with money to spare. Washington has to stop spending money on wasteful stuff. Studies on things that just aren't important now. Cuts got to happen folks and I can suck up the fact it might effect me, my disbaility pymts. Everyone is for shared sacrifice, are u willing to do ur share? Most arnt. Oh and yeah...tax the rich, u do realized under obamas plan that is $250,000 and up. Alot of ur employers folks! So what happens? It gets made up for in higher cost of goods, no new employees, less hours for those u have or layoffs. The rich hire the rest of us, don't bit ethe hand that feeds u! I am all for the rich, means we have a home, food, cars cause there is someone to give us a pay check!
terri, Nobody "gives you" a paycheck. You earn it by being productive. You are productive when you make more money for your employer than you cost. "Taxing the rich" means taxing their personal income (though I understand many small businesses take their profit as personal income). Taxing them another 2 or 3% will not make them refuse to hire if there is demand for their product. If there is no demand for their product reducing their taxes to zero will not make them hire. What will make them hold off on hiring and possibly even be forced to lay people off would be an decrease in their ability to take out short term loans (many businesses do this on a regular basis in order to make payroll and pay their bills when their receivables don't come in on time or don't match outlays). The downgrading of the US credit rating WILL effect the ability of small business to get short term loans or at the very least will make those loans more expensive costing small (and large) business money. Regardless of whether the debt ceiling gets raised or not, the political games being played by OUR representatives in government may have already pushed us past the tipping point with the rating agencies. At the very least it puts us on a very narrow ledge.
The goverment needs to get it together. People should not have to suffer for blanching the budget. The elderly worring about there checks. Look I pay taxes and I would gladly pay more taxes to keep the elderly and to keep ssi going.
Wake up! The top 1 percent are not "job creators" They are "money makers". Creating jobs is a by-product of increasing production to generate more revenue. The 1 precent will not walk away from a highly profitable venture just because they would have to pay more in taxes. It all gets calculated into business decisions. And yes they do have better accountants than you. I don't know about your town but we are getting a new maclaren dealership opening up soon. Right across from ferrari and next to bentley. The wealthy are doing just fine.
Conservatives are misguided morons
I don't mind some of the news on CNN, but I hate filtering out the bias writing. We are here just for straight forward facts not leaning one way or the other. People will live on after this one way or the other. Not end of the world. Government needs to change its habits like everyone else.
I teach and study argument at a college. CNN is actually the most objective and fact driven news network to date. Because I am teaching Debate this upcoming year, I am tracking this story hours every day, fact checking, and compiling information. Repubicans and Tea Party members do not have their facts straight; only in rare cases are they even half right. Democrats have shown (so far) to be more truthful; generally, they are close to the facts of the matter. Our other news networks lean one way or the other in extemes, fail to check their facts (or ignore them outright), and ignore objectivity.
Ralph Nader once said: There's only one thing the truly weathy really want, and that's everything. Looks like they are going to get just that, for a short time, anyway, until the house of cards under them collapses.
Just have both parties but their best proposals for the country out there and put it to a vote by the American People. These idiots are too far gone to be able to come up with what is best at this point. Raise the ceiling to get us through the next couple of years and lets see what happens when people get to chime in with their votes. You can even have components voted on separately but put it on a ballot by next March and lets move on.
What happens to seniors' medicare plans if SS and SSDI checks are not issued? Do they lose their coverage? The one thing no one seems to talk about is the fact that those who receive medicare PAY to have it.
To the one who said thank you obama for makeing us weak he didn't do that the bushs did he trying to make everbody equal yes the rich should pay more taxs just like the wealth
Thank you Shenitta: people are working hard to blame Obama and that is a shame. They want America to forget who created the mess that led to this. Obama knew going in what the debt would be by this time. And he was right. I am afriad that some who say that the Tea party and the GOP may be working against Obama due to his skin color may be closer to the truth than I would like to think. They work tirelessly to tear him down and find fault – even trying to make Americans believe he was not born an American. Now they are sabotaging him. They need to look at the polls that lay at least 55% of the blame of the crisis we are in on the GOP! They do not care. They are short sighted.