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But despite some dire warnings about defaulting on some of that debt, the government seems no closer to an agreement that could solve either its short- or long-term budget problems. NPR's Scott Horsley reports.
SCOTT HORSLEY: Last Monday, President Obama challenged lawmakers to make what he called the largest possible deficit-cutting deal. He envisioned an agreement that would erase some $4 trillion worth of red ink over the next 10 years.
BARACK OBAMA: Now is the time to deal with these issues. If not now, when?
HORSLEY: Well, not this week anyway. Mr. Obama met with congressional leaders, Sunday, Monday, Tuesday, Wednesday
and Thursday, but they failed to reach any agreement on a deficit-cutting strategy. A meeting planned for Friday was called off, and Mr. Obama told lawmakers to keep working on it.
OBAMA: My hope is is that after some reflection, after we walked through all the numbers this week and we looked all the options, that there may be some movement, some possibility, some interest, to still get something more than the bare minimum done. But we're running out of time.
HORSLEY: Lawmakers have a little more than two weeks to raise the debt ceiling Congress has imposed and adjusted regularly since 1917. If it's not raised by August 2nd, the government won't be able to borrow the money it needs to pay its bills. The bond rating agencies Moody's and Standard and Poor's both issued credit warnings this week, saying there's a small but growing possibility of a government default. What's blocking a deal to cut the deficit is a disagreement over taxes. Mr. Obama says wealthy Americans should share in the sacrifice through higher taxes. House Speaker John Boehner and the Republican lawmakers he represents disagree.
JOHN BOEHNER: Our stand on the debt limit has been clear. There can be no tax hikes because tax hikes destroy jobs.
HORSLEY: Although Republicans lawmakers have not budged, Mr. Obama is convinced public opinion is on his side. Polls released this week by Gallup and Quinnipiac University found large majorities of voters, including Republicans, agree that increased tax revenue should part of the deficit-cutting mix.
OBAMA: Eighty percent of the American people support an approach that includes revenues and includes cuts. So, the notion that somehow the American people aren't sold is not the problem. The problem is members of Congress are dug in ideologically.
HORSLEY: That made for some testy exchanges during the week. Senate Republican Leader Mitch McConnell declared that as long as Mr. Obama is in the Oval Office, a real solution to the deficit is unattainable. The president told lawmakers they're confirming Americans' worst impressions about a dysfunctional government. Yesterday, Mr. Obama brushed aside what he called the reality TV aspects of this drama, telling reporters he's still optimistic some grand bargain on the deficit is possible.
OBAMA: I always have hope. Don't you remember my campaign?
(SOUNDBITE OF LAUGHTER)
OBAMA: Even after being here for two and a half years. I continue to have hope. Do you know why I have hope? It's because of the American people. You know, when I talk to them and I meet with them, as frustrated as they are about this town, they still reflect good common sense. And all we have to do is align with that common sense on this problem.
HORSLEY: Republican Senator McConnell offered his own backup plan this week that would authorize the president to raise the debt ceiling by himself, in the absence of a deficit-cutting deal. That plan has been bitterly denounced by some conservatives in both the House and Senate. House Speaker Boehner says such a plan may become necessary in a couple of weeks. But not yet.
BOEHNER: Listen, Senator McConnell pointed out that his plan was being put on the table as a last-ditch effort. We're far from the time for a last-ditch effort.
HORSLEY: In other words, Washington is going to be wallowing in a few more intermediate ditches between now and August 2nd. Scott Horsley, NPR News, the White House.
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