Debt debate: Where things stand
Speaker John Boehner gives the thumbs-up Friday after the House voted 218-210 to approve his debt-ceiling measure.
July 30th, 2011
10:28 PM ET

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.

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Filed under: Barack Obama • Harry Reid • John Boehner • Politics
soundoff (370 Responses)
  1. Jim

    OK, EVERYONE stop paying you mortgages and get the banks back in this thing....Watch DC solve it in minutes

    July 30, 2011 at 6:57 pm | Report abuse |
  2. Katie

    I just hope Mr. Obama doesn't cave into giving the GOP what they want out of fear of hurting the poor and middle class people of the country. The GOP doesn't care if they cause pain...they only want to help their rich friends. As for the Tea Party, well, I don't think they really understand what's going on. Research into the movement has shown they are not the best educated people on political matters. They've been told a lot off false informaton by the Tea Party leaders and have bought into it hook, line and sinker. The Republican Party would be a lot better off if they treated these people as the minority loonies they really are...and listened to the majority of the party members.

    July 30, 2011 at 6:59 pm | Report abuse |
  3. marie matzek

    I think the programs are needed. The problem as I see it it that they have no one "minding the store". The programs are so large that it is impossable to keep track of who is doing what or getting what. At least in a way that makes sense.Once the Laws are signed-thats it. Go home, session over, vacation time-whats next on the agenda-hurry up my private plane leaves in 20 minutes No one on that level makes sure the programs are running like they were intended or doing what they set it up to do-or safeguard that it doesnt get out of control. It is not the program,or the need. These programs are needed,and one of the things that make our nation as great as it is. Cant get these programs in Cuba can you? Again our leaders get plenty in their paychecks-they need to mind the store better-BEFORE IT BECOMES A CRISIS not only when there is a crisis or emergency. Talk about a crisis mentality! They need to protect the Country/Protect our Freedoms/ and be Proactive about Protecting needed Programs BEFORE IT GETS TO THIS BIG MESS-AND THEN ARGUE ABOUT ALL THE WAY DOWN THE TUBES WHILE THET TAKE ALL OF US WITH THEM.

    July 30, 2011 at 7:00 pm | Report abuse |
  4. Paul

    I wish there was a viable, powerful, third party, which was moderate in outlook. Both the repubs and dems leave a lot to be desired at this juncture. And before anyone says it, the tea party is not a third party, they are essentially the right wing taliban, impervious to compromise, a middle ground, or reason.

    July 30, 2011 at 7:02 pm | Report abuse |
  5. Name*coco

    I am wanting the politicans to stop talking and start doing something. quite playing the blame game.

    July 30, 2011 at 7:03 pm | Report abuse |
  6. Greater Good

    Why do I get the feeling our President is going to cave yet again and the GOP and their rich pals are going to come out of this smiling..?

    July 30, 2011 at 7:06 pm | Report abuse |
  7. R Black

    Really! The Chairman does not know what day of the month his soldiers, sailors, and marines get paid. Quick CNN do a fact check.....It is the first day of the month and the fifteenth for those that choose mid-month pay. You just let the administration and the democratic leadership skate on fear mongering. See if this makes it on to the nightly news Wolf!

    July 30, 2011 at 7:07 pm | Report abuse |
  8. Kiki

    I wonder as the impending demographic tidal wave hits how this will affect the balance of power. If you look at the numbers, the face of our electorate will be radically different in a few short years.

    July 30, 2011 at 7:07 pm | Report abuse |
  9. robert

    Ha.... these tea party people have the republicans by the privates they deserve it! I bet tea party people in south carolina are really proud of their senator and representatives, maybe they should sucede!!!!!

    July 30, 2011 at 7:10 pm | Report abuse |
  10. marie matzek

    Those that will not flex and find it impossible to empathise with other human beings are called DICTATORS. SORRY WRONG COUNTRY. THIS IS A DEMOCRACY.If unable to do the job-and negotiate- have empathy for the less fortunate and do the job you are paid to do then there are plenty of other countries that dont have the rights we have here. Maybe they have an opening. Oh wait-their citizens are overthrowing their dictators...............

    July 30, 2011 at 7:13 pm | Report abuse |
  11. Redeye Dog

    Everybody is dogging the Republicans but from the standpoint of success, Boehners plan has a better chance for success although it is NOT popular. The Democrats are proposing $2.4 trillion deficit reduction over 10 years while raising the debt ceiling $2.4 trillion now? Get real!

    How many congresses will pass in 10 years? The plan is just a bunch of smoke. At the rate Obama has been spending, it will not even last until the election and then where will we be?

    $17 Trillion in debt! That's where... But we'll get it back in 8.5 years.. Yeah, right!

    July 30, 2011 at 7:13 pm | Report abuse |
  12. Heather

    I don't know what their dang problem is in Washington, but they need to wake up before it is too late. I voted for Obama and now regret it. I don't think I would vote democrat or republican next time. They are like little babies who throw tantrums when they can't get their way. I don't want my SSDI or SSI cut, but lord knows I need at least some money next month. My mom can't support me on a minimum wage job making 30 hours a week. The government doesn't care about the elderly, the disabled, or even veterans apparently, by the looks of the way they are behaving. I don't think any of them deserve to keep their jobs if they can't come to an agreement before Tuesday. I wonder how many other people feel that way. Maybe they should be denied their paychecks since it is their faults that we may not get ours. It's not right.

    July 30, 2011 at 7:13 pm | Report abuse |
  13. Wicked45662

    I have to agree with Mike Morrison Stop the no working and drug users and dealers from living on our working people. Make the Wealthy pay taxes and we would not have a problem. I get tired every day roofing @ 100 + temps while they lay in the AC and do drugs and make money. COME ON AMERICA WAKE UP.

    July 30, 2011 at 7:14 pm | Report abuse |
  14. Joel

    Boehner talks of the Republicans dealing with "reasonable, responsible people," i.e. the Democrats I assume. Sorry sir, but this sure doesn't apply to the Teapublicans within your own ranks!!!

    July 30, 2011 at 7:18 pm | Report abuse |
  15. Wicked45662

    Also agree with heather Take their checks NOW and use them to pay all that paid into them so they could get it back. They make billions on mony they never owned and now can not pay it back so take theirs. Just like a bad madoff deal our gov just got caught. So PAY IT BACK

    July 30, 2011 at 7:22 pm | Report abuse |
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