Administration, GOP downplay reports of deal

WASHINGTON  With time running short to raise the nation's $14.3 trillion debt limit, President Obama and congressional leaders worked through another tumultuous day of negotiations Thursday with little public progress for weeks of work to reach a compromise that would let the government to keep borrowing money while cutting spending and, perhaps, increasing taxes.

Democratic sources close to the negotiations said the potential agreements discussed by the White House and Republicans include up to $3 trillion in spending cuts over 10 years and a tax code rewrite by the end of 2012 that would bring in up to $1 trillion, also over the course of a decade. The sources spoke on condition of anonymity because they weren't authorized to speak publicly.

However, administration officials and congressional Republicans spent much of the day downplaying such reports.

"There is no progress to report," White House press secretary Jay Carney told reporters just 12 days before the Aug. 2 deadline set by the Treasury Department to raise the debt limit or face a first-ever government default on its loans — and, economists and Obama have warned, economic catastrophe.

House Speaker John Boehner, R-Ohio, also told conservative radio talk-show host Rush Limbaugh that "there is no deal. No deal publicly. No deal privately. There is absolutely no deal."

Obama, in an op-ed for USA TODAY, reiterated that he wants to strike a "big and meaningful" deal that combines spending cuts with asking "the wealthiest individuals and biggest corporations to pay their fair share through fundamental tax reform."

That means that "before we stop funding clean energy research, we should ask oil companies and corporate jet owners to give up the tax breaks that other companies don't get," Obama wrote. "Before we ask college students to pay more, we should ask hedge fund managers to stop paying taxes at a lower rate than their secretaries. Before we ask seniors to pay more for Medicare, we should ask people like me to give up tax breaks they don't need and never asked for."

The president noted that "there will be plenty of haggling over the details" in the days ahead — and that haggling continued with another evening meeting with Democratic congressional leaders at the White House that lasted almost two hours.

Democrats, whose concerns were voiced by Senate Majority Leader Harry Reid of Nevada, were angered by the reports of the nebulous deal that included spending cuts now and revenue increases tied only to a review of the tax code next year.

Reid said any deal to curb the nation's debt and growing deficits must include new revenue to balance cuts to programs that would affect the poor, the middle class and the elderly.

"There has to be a balance," he said. "There has to be some revenue."

Meanwhile, Reid moved up plans for the Senate to dispense with a House-passed "Cut, Cap and Balance" bill that would increase the nation's debt limit by $2.4 trillion as long as the increase is met by immediate spending cuts and a balanced-budget amendment to the Constitution.

Senate Minority Leader Mitch McConnell, R-Ky., said the Friday vote would be a chance for lawmakers to "go on record in support of balancing our books or against it."

Democrats charged that the bill would impose draconian cuts on Medicare and Social Security, crucial entitlement programs for the elderly. "The radical right is more worried about protecting their next election than protecting the greatest generation," Sen. Barbara Mikulski, D-Md., said.

Obama has threatened to veto the bill, but that won't be necessary. Reid, who scheduled the Friday vote, said it "doesn't have one chance in a million of passing in the Senate."

With that bill off Congress' plate, lawmakers presumably can move ahead on other ideas. Among them: a "Gang of Six" proposal put forth by a bipartisan group of senators to cut spending and raise about $1 trillion in taxes over 10 years. That plan is opposed by conservatives such a House Budget Committee Chairman Paul Ryan, R-Wis., who say it could increase taxes by as much as $2 trillion.

Boehner expressed some confidence that Republicans and the White House can eventually make a deal. Although there are some House Republicans who will only support the "Cut, Cap and Balance" bill, "I do not believe that would be anywhere close to the majority," he said.