WASHINGTON (AP) — The Senate's top two leaders both expressed optimism Monday that they were closing in on an agreement to prevent a national financial default and reopen the government after a two-week partial shutdown.
After meeting twice Monday with his Republican counterpart, Democratic Majority Leader Harry Reid opened the Senate session by saying he was 'very optimistic we will reach an agreement this week that's reasonable in nature." Moments later, Republican leaderMitch McConnell seconded Reid's view.
They spoke after what McConnell termed "a couple of very useful discussions."
Officials in both parties said House and Senate negotiators would be appointed to seek a deficit-reduction agreement that could ease or eliminate a new round of automatic spending cuts scheduled to take effect in January. While the current round of these cuts fell on both domestic programs and defense, the upcoming reductions would hit primarily the Pentagon.
The officials said the two leaders were discussing legislation to raise the $16.7 trillion debt limit until spring. It was not clear if that would permit Treasury Secretary Jacob Lewto employ a series of steps that could add additional months to the extension, as administrations in both parties have done in recent years.
In addition to raising the debt limit and reopening the government, officials said, the two leaders were discussing a possible tightening in income verification requirements for individuals who qualify for subsidies under the health care law known as Obamacare.Democrats were resisting a Republican-backed proposal to suspend a medical device tax that was enacted as part of the health care law. The tax is widely unpopular among lawmakers in both parties, but the outcome of that disagreement remained unclear.
These officials spoke on condition of anonymity, saying they were not authorized to discuss private matters.
While Reid, D-Nev., said there was not yet an accord, he said he hoped to have a proposal to outline when the two men and House leaders meet with Obama at mid-afternoon. Emerging from Reid's office, Sen. Amy Klobuchar, D-Minn., said "he told us the negotiations were productive and positive."
No details were available on the terms under discussion.
Visiting a Washington charity, Obama mentioned the possible progress in the Senate and said his mid-afternoon meeting will determine whether it's real.
"My hope is that a spirit of cooperation will move us forward over the next few hours," the president told reporters.
Otherwise, he warned that the threat of default was legitimate.
"If we don't start making some real progress both in the House and the Senate, and if Republicans aren't willing to set aside some of their partisan concerns in order to do what's right for the country, we stand a good chance of defaulting," he said.
In announcing the meeting with Obama, the White House said the president would repeat a vow he has made consistently in recent weeks: "we will not pay a ransom for Congress reopening the government and raising the debt limit."
The two Senate leaders, Reid and McConnell, had spoken by phone Sunday but failed to agree on a deal to raise the nation's borrowing authority above the $16.7 trillion debt limit or reopen the government. Congress is racing the clock with Treasury Secretary Jack Lewwarning that the U.S. will quickly exhaust its ability to pay the bills on Thursday.
Separately, a bipartisan group led by Sen. Susan Collins, R-Maine, met for two hours Monday morning on a possible solution to the impasse.
"We're making very good progress, but there's still many details to be worked out," Collins said before joining her GOP colleagues at a meeting with McConnell. "We don't have a finished, agreed-upon product yet but I think we had an excellent meeting. And we'll get together later today."
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