Republicans, Democrats Unveil Rival Plans for Raising Debt Ceiling

U.S. House of Representatives Speaker John Boehner on Monday announced a new Republican, two-stage, short-term plan to increase the nation's debt ceiling. On the Senate side, Democratic Majority Leader Harry Reid announced a longer-term plan that the White House immediately endorsed. The United States must raise its debt ceiling by August 2 to continue borrowing money to meet America's financial obligations.

In Washington, it was another day of dueling news conferences and competing plans in the political battle over raising the debt ceiling and avoiding the country's first default. This time, it was the Republican-controlled House of Representatives versus the Democratic-controlled Senate.

House Speaker John Boehner proposed legislation that would cut government spending and raise the debt limit in two different votes, one now, cutting spending by about $900 billion and another vote next year before the general elections. Boehner called it a "common sense" plan that does not give Republicans or Democrats everything they want. "It does ensure that the spending cuts will be greater than the hike in the debt limit. And secondly, there are no tax increases that are a part of this plan," he said.

President Barack Obama has repeatedly opposed a short-term extension of the debt ceiling, saying it could damage the nation's credit rating, and that the United States soon would face with the same partisan wrangling over raising the debt ceiling in just a few months.

Democrats who control the Senate also oppose a short-term extension. Democratic Senator Charles Schumer condemned Boehner's proposal. "Speaker Boehner has refused to budge from his proposal. He is even going ahead with a vote on the House on this plan though he knows it cannot become law. This is a dangerous waste of time given that there are so few days between now and the deadline," he said.

Boehner called on Senate Democrats and the president to support the House Republican plan. "And I think it would be irresponsible for the president to veto such legislation because it is a common sense plan and will help us avoid default," he said.

Shortly before Boehner announced the proposed House measure, Senate Majority Leader Harry Reid proposed a plan crafted by fellow Democrats that would not reduce social welfare programs many Democrats support and not raise taxes, an issue crucial to most Republican lawmakers.

"This proposal satisfies Democratic core principles by protecting Medicare, Medicaid and Social Security, and provide the long-term extension of the debt ceiling that the markets are looking for. The bill also meets Republicans's demands, two major demands," he said. "It contains no [new] revenues, and the amount of the cuts meets the amount of the debt ceiling increases. They wanted a one-for-one [increase in the debt ceiling to budget cuts ratio] and that is what we gave them. So now, all the Republicans have to do is say, 'Yes.'"

Reid's plan would reduce the deficit by $2.7 trillion and raise the debt ceiling until after next year's presidential and congressional elections.

After Reid unveiled his proposal, White House Press Secretary Jay Carney issued a statement endorsing it, calling Reid's plan a reasonable approach that should receive the support of both major political parties.

But Reid still has to get his bill past procedural roadblocks by Senate Republicans. The House of Representatives will likely vote on Speaker Boehner's plan within the next few days.

Democratic Representative James Clyburn appealed for unity for the good of the country. "It is time for us to find common ground. We have competing proposals from Democrats in the Senate, Republicans in the House. It is time for us to meld those proposals, find common ground, lift the debt ceiling and let us restore stability in the lives of our citizens," he said.

But for now, with barely a week until the nation's debt ceiling is reached, the two chambers of Congress appear set to vote on their separate proposals. Meanwhile, President Obama is scheduled to speak to the nation about the debt crisis on Monday night.