Update: Republican and Democrat leaders have a new deal with President Barack Obama to beat the debt limit deadline and raise the deficit another $3 trillion to meet the country’s financial obligations.
Obama announced the agreement Sunday night and said “the default would have had a devastating effect on our economy.”
According to a power point presentation issued by House Speaker John Boehner, the agreement will cut government spending more than it increases the debt limit, implements spending caps to restrain future spending, and “advances the cause of a Balanced Budget Amendment.”
The “framework accomplishes this without tax hikes, which would destroy jobs, while preventing a job-killing national default,” the document said.
House and Senate party caucuses will meet with their members Monday morning to discuss the details of the plan. Tuesday is the deadline for Congress to pass a compromise measure.
The Senate on Sunday blocked legislation offered by Senate Majority Leader Harry Reid to raise the debt limit on a vote of 50 to 49.
A super majority of 60 votes were needed to proceed to a final passage vote.
Democrats voting against the Reid plan included Bernie Sanders (Vt.), Ben Nelson (Neb.), and Joe Manchin (W.V.).
Reid also voted against his own legislation — a procedural move that allows him to bring the measure to the floor again for a future vote.
Meanwhile, Republicans say they are close in reaching an agreement with the White House.
“A potential agreement is within our reach,” Senate Minority Leader Mitch McConnell (R. -Ky.) told CBS’s Face the Nation Sunday morning.
With Democrats controlling the Senate and the White House, McConnell said there is “only so much you can achieve when you don’t have the leverage of power.”
“Let’s get as much spending reduction as we can possibly get out of a government that we don’t control,” McConnell said.
A possible deal floated by ABC News as the tentative agreement would raise the deficit another $3 trillion to meet the country’s financial obligations.
Reid indicated that no further action is expected on the Senate floor today, but told his colleagues to be available on short notice if a deal is reached.
“We’re not there yet,” Reid said of a deal, “but I’m hopeful and confident it can be done.”