By Lori Montgomery and William Branigin
President Obama on Tuesday hailed an ambitious new deficit-reduction plan that is gaining momentum in the Senate saying it could provide the vehicle to break an impasse over raising the federal borrowing limit while cutting the nations debt.Appearing at the regular White House news briefing Obama said the bipartisan proposal is broadly consistent" with the approach he has advocated in that it reduces discretionary spending and tackles health-care spending and entitlements while also raising additional revenue.
But in the event that an agreement capable of passing Congress is not reached before a looming deadline to raise the federal debt ceiling Obama said lawmakers should finishing hammering out a backup plan now being negotiated by the Senates Democratic and Republican leaders.
Were in the 11th hour and we dont have a lot more time left" Obama said. We dont have any more time to engage in symbolic gestures." He was referring to a House Republican plan that includes a balanced-budget amendment which he said is not a balanced" approach could not pass both chambers and would be vetoed if it did.
Obama spoke after more than 40 Republicans and Democrats attended a morning briefing on the new Senate proposal which would slice $3.7 trillion from the federal budget over the next decade.
The plan drafted by a bipartisan group of senators known as the Gang of Six" has been in the works for months. After struggling to reach consensus and apparently disbanding last week the group now says its nearing agreement on a proposal which could offer an alternative strategy for pushing an increase in the debt limit through Congress before the Aug. 2 deadline.
Weve gone from a Gang of Six to a mob of 50" exulted Sen. Joe Manchin (D-W. Va.) as he emerged from the meeting. The proposal Manchin said shows great promise."
I will support it. It is a fair compromise" added Sen. Kay Bailey Hutchison (R-Tex.). This is a way forward where we can do the work that we have come here to do."
Details of the plan were sketchy and it was not immediately clear how the proposal might be combined with existing debt-limit strategies. As described by its creators the framework calls for $500 billion in immediate spending cuts as a downpayment on a broader debt-reduction effort that would be carried out largely by existing legislative committees.
Those committees would be given targets for savings from overhauling entitlement programs and rewriting the tax code. If the committees failed to produce a plan to meet the targets over the next six months 10 senators five from each party could step in to offer their own debt-reduction plan.
The overall goals of the plan mirror President Obamas fiscal commission: Deep cuts in government agencies significant reductions in Medicare and a framework for keeping Social Security solvent over the next 75 years. It also seeks to raise $1 trillion in taxes over the next decade by rewriting the tax code to lower tax rates for households in all income categories while eliminating various tax breaks and deductions.
