WASHINGTON — Senate Majority Leader Harry Reid signed off Sunday on a pending agreement to raise the government's borrowing limit and make spending cuts, subject to approval by the Democratic rank and file.
Following a meeting with Senate Minority Leader Mitch McConnell late Sunday, Reid said "we're still not finished. We're working hard, though."
Earlier in the day, Reid had warned that "as we know, one problem can stop the whole agreement from going forward.”
And one potential obstacle seemed to be developing: the size of cuts to military spending that might be forced by a "trigger" if Congress couldn’t meet certain deficit reduction targets on its own.
House Armed Services Committee Chairman Buck McKeon, R-Calif., and other GOP advocates for the military warned last week against further reductions to military outlays on top of the $400 billion that President Barack Obama has sought over the next 12 years.
Independent Democrat Sen. Joe Lieberman of Connecticut issued a statement Sunday saying he was "very concerned about rumors that the debt agreement now being negotiated will disproportionately cut defense spending."
Speaking later Sunday, House Democratic Leader Nancy Pelosi said it was unclear whether House Democrats would back the deal. "We all may not be able to support it, or none of us may be able to support it. But we'll wait and see," Pelosi told reporters.
The Congressional Budget Office has forecast that over the next 10 years defense spending will grow at an average rate of 2.3 percent a year, while Medicare will grow by nearly 7 percent a year, Medicaid by 9 percent a year and Social Security by nearly 6 percent a year.
Republicans such as McKeon would like to see the growth of those entitlement programs reined in, while shielding the military from cuts.
A senior congressional aide told Retuers that a Senate vote was "highly unlikely until at least Monday. "This is a huge bill. People don't even know what's in it yet," the aide said, noting that Senate Democrats and Republicans were expected to be briefed on it later on Sunday.
Negotiations with White House officials continued as the clock ticked toward Tuesday, the day when Treasury Secretary Tim Geithner has said the government will reach its borrowing limit and be forced to operate solely on its daily cash inflow. It would be unable to pay all its bills and would face an almost certain downgrade by bond ratings agencies such as Standard & Poor's.
The emerging deal would raise the government's $14.3 trillion borrowing limit in return for enacting measures that would reduce cumulative deficits over ten years by about 22 percent, or $2.8 trillion, based on the Congressional Budget Office's most plausible budget forecast.
Reid said that as part of an accord, a 12-member joint congressional committee will be created and given the task of achieving further deficit reduction, once a first round of cuts has been made. “There are no constraints. It can look at any program we have in government,” Reid said of the new committee. “It will be essential to choose members with open minds willing to consider every option, even when the options are difficult to swallow for both parties.”
Estimating the vote count
Even before all the details of the accord were revealed on Capitol Hill, calculations were being made of potential support in the House.
With 433 House members and two vacancies, a bill would need 217 votes to pass, if all members vote.
The head of the 74-member Congressional Progressive Caucus, Rep. Raul Grijalva, D- Ariz., said he’d oppose the agreement which, he said, "trades peoples' livelihoods for the votes of a few unappeasable right-wing radicals."
On the other side of the spectrum, it was not clear how much opposition there might be from advocates for the military and from the 59-member Republican Tea Party Caucus.
Even if all the Progressives and all Tea Party members were to vote ‘no,’ the opponents of the plan would still need to persuade 84 more House members to join with them in opposition in order to defeat the proposal.
As of Sunday, none of the congressional leaders was talking about expiration of the current income tax rates on Dec. 31, 2012 — that battle will apparently be fought next year in the midst of the election as President Barack Obama seeks his second term. Obama has been seeking higher income tax rates on those earning more than $250,000 a year.
Video: WH Sr. Adviser: Sunday is ‘critical’Obama adviser: Sunday 'a critical day'
Obama adviser David Plouffe on NBC's Meet the Press, outlined the structure of an agreement between Obama and congressional leaders.
It would require an initial round of $1 trillion in deficit reduction, mostly or entirely coming from spending cuts, followed by work by the new congressional committee to recommend even deeper deficit reduction which would be achieved, said Plouffe, through “entitlement reform and tax reform.”
Video: Winners and losers in debt-ceiling debatePlouffe said the committee would be mandated to recommend specific spending cuts, but it “is not going to be charged with just doing spending cuts only. The committee is going to be charged looking at our entire deficit reduction problem and look at things like tax reform and revenue.”
Plouffe indicated that Obama was sticking to his insistence that any agreement raise the debt limit through the end of 2012. Plouffe said, “This debt ceiling cloud has harmed our economy. Why on earth would we want to go through this again a few short months from now?”
Video: WH Sr. Adviser: ‘There is no offramp’ If the borrowing limit is reached, Geithner has said, the government will be forced to make a 40 percent cut in outlays. Geithner has been unwilling to discuss in public how the Treasury would
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