POSTED: Sunday, July 17, 2011 - 9:25am
UPDATED: Sunday, July 17, 2011 - 6:02pm
WASHINGTON — (AP) -- Congress and the Obama administration are weighing their options as time closes in on the deadline for raising the nation's debt ceiling, and the White House may call another meeting Sunday of congressional leaders and President Barack Obama.
White House and congressional and aides will continue discussions as Congress moves on two tracks to find a solution for increasing the nation's borrowing authority while reducing long-term deficits.
The government will exceed the current $14.3 trillion debt ceiling on Aug. 2, after which it will be in default of its obligations. The consequences could be far-reaching, with potentially higher interest rates on mortgages and car loans, a halt in Social Security checks and unsettled world financial markets.
Republicans and some Democrats want to use the debt ceiling countdown as an opportunity to reduce long-term deficits, but both sides have reached an impasse on how to accomplish that.
House Republicans are preparing to vote this week on allowing an increase in the government's borrowing limit through 2012 as long as Congress approves a balanced-budget constitutional amendment, which is highly unlikely.
In the Senate, the Republican and Democratic leaders are working on a bipartisan plan that would allow Obama to raise the debt limit without a prior vote by lawmakers. The talks are focusing on how to address long-term deficit reduction in the proposal to satisfy House Republicans.
"Lines of communication remain open with all parties," said Brendan Buck, a spokesman for House Speaker John Boehner.
White House budget director Jacob Lew was scheduled to make a round of appearances on Sunday television news shows to make the case for Obama's call to reduce deficits with a mix of spending cuts and revenue increases. Republicans have rejected any plan that contains tax increases.
Obama made the argument himself in his weekly radio and Internet address.
"We have to ask everyone to play their part because we are all part of the same country," Obama said Saturday, pushing a combination of spending cuts and tax increases that has met stiff resistance from Republicans. "We are all in this together," he said.