Still no deal.
That's the situation facing the country Tuesday, one week before the Obama administration's August 2 deadline for raising the debt ceiling to avoid economic catastrophe.
With both a Senate Democratic plan and a House Republican plan looking unlikely to clear Congress, White House press secretary Jay Carney said Tuesday that "we're working on Plan B" - though he acknowledged the White House couldn't get there alone.
"Congress has to come together," he said. "There has to be a product that can pass the House and the Senate and be signed into law. We're part of that process." Carney declined to describe what this Plan B might look like, saying only that the White House was discussing alternatives with members of Congress.
Washington awoke Tuesday to a largely unchanged landscape following aand that seemed to do nothing to move the conversation forward.
Mr. Obama declined to present specific details of a possible compromise plan, instead calling for a renewed attempt at a "grand bargain" deal that includes both spending cuts and revenue increases. That's an approach that most people in Washington thought was effectively dead, and Mr. Obama's decision to focus on it - instead of the plan from Senate Democrats, or a new proposal - left many in Washington scratching their heads.
Boehner, meanwhile, gave a defiant speech that essentially doubled down on his party's no-compromise posture, one driven by the Tea Party hard liners who make up a large chunk of the House Republican caucus.
Boehner is pushing Mr. Obama to sign a
Even if the plan did pass, however, it could likely not get through the Democrat-led Senate. The White House has repeatedly said it would not sign a short-term plan, which it said creates economic uncertainty and could lead to a downgrade in the nation's Triple-A credit rating. On Tuesday afternoon, the White House issued a formal veto threat of the bill.
Senate Majority Leader Harry Reid, meanwhile, called the Boehner plan "dead on arrival in the Senate, if they get it out of the House." He said it "was written for the tea party, not the American people."
House Republicans have also scheduled a Thursday vote on a balanced budget constitutional amendment, something strongly favored by fiscal conservatives; that bill has even less chance of passage than the Boehner plan, but holding the vote could help the Republican leadership get the votes to pass the Boehner bill Wednesday.
There is also a
But that plan has problems too, including the fact that $1 trillion of its $2.7 trillion in cuts essentially come from an accounting trick: Counting savings from winding down the wars in Iraq and Afghanistan - something the nation is already planning on doing - as spending cuts. Boehner says the plan cannot pass the House, and it's not clear that it has the 60 votes necessary to break a filibuster in the Senate.
Mr. Obama barely mentioned the Senate plan in his speech Monday night, though he did signal support for it; Carney today called it a "legitimate compromise measure" and said the White House believes it could pass both chambers "if folks gave it a fair shake."
Carney also continued to push for the "grand compromise" deal that Boehner walked away from Friday, saying it "is still on the table and is out there and ready to be taken up." But with House Republicans vowing not to support anything that includes revenue increases - even when paired with trillions in spending cuts - it's hard to see how that plan gets resurrected.
Republican Sen. Pat Toomey of Pennsylvania said Tuesday "it's increasingly possible we will not have raised the debt ceiling by Aug. 2." He and other Republicans are pushing a bill that would mandate the government prioritize interest on its debts, Social Security benefits and military payrolls in the event a deal cannot be reached.
The Obama administration has said that without congressional action, the U.S. will breach its limit on borrowing next Tuesday, August 2, though it
Credit ratings agencies have warned that they are poised to withdraw the United States' triple-A credit rating without guarantees that it will not default, and they have also suggested that the credit rating is in danger without a significant deficit reduction effort. That would potentially mean an increase in the cost of borrowing both for the U.S. government and for Americans seeking home and car loans and a higher interest rate for those seeking to pay off credit card debt.