WASHINGTON (MarketWatch) — The Senate voted Friday night to set aside a House-passed bill that would raise the U.S. debt limit and cut the deficit, paving the way for a vote on Senate Democrats’ own measure and intense compromise talks as the clock ticked toward a potential government default next week.
Boehner: ‘I stuck my neck out’
In addressing the House of Representatives, Speaker John Boehner called on Democrats to "put something on the table." Courtesy Fox News.
The House bill passed 218-210 earlier Friday, after Republican leaders won over conservatives by tying an increase in the $14.3 trillion debt limit to passing a balanced-budget amendment. President Barack Obama opposes the House bill and is backing the rival measure from Senate Democratic Leader Harry Reid.
The House and Senate bills share key similarities, but a sticking point is how much and when to raise the government’s borrowing limit.
Senate leaders were working furiously on a compromise measure, and comments from Republicans including Sens. Olympia Snowe of Maine and Scott Brown of Massachusetts indicated a deal could win bipartisan support. Snowe said she was reviewing plans by Reid, of Nevada, and Minority Leader Mitch McConnell of Kentucky and hoped they would work through their differences, according to The Wall Street Journal.
Obama continued to warn that the debt limit needs to be raised by Tuesday to avoid default. Payments on Treasury debt, veterans’ benefits and government employees’ salaries would halt if the government can’t pay its bills, the White House says.
On Saturday, the Republican-controlled House plans to reject Sen. Reid’s debt-ceiling bill, which would cut around $2 trillion in spending over 10 years and raise the debt limit by about $2.4 trillion. That’s enough to last past the 2012 elections and avoid a new fight over the debt ceiling before voters go to the polls.
