By Alexander Bolton - 07/15/11 09:52 PM EDT
A fall-back plan to avert a national default is under negotiation by Senate leaders and is on track to be unveiled by Wednesday or Thursday of next week, according to a Senate Democratic aide.
Senate leaders estimate they will have to have the contingency plan ready to go by Thursday to have enough time to get it passed through both chambers by Aug. 2.
A Democratic aide said it would likely take nearly two weeks to pass it because of expected filibusters.
McConnell is negotiating with Senate Majority Leader Harry Reid (D-Nev.) to modify the plan to make it more likely to pass the Senate.
The proposal McConnell introduced would authorize President Obama to raise the debt limit by $2.5 trillion in three requests.
Under the plan, Obama would have to make three requests to Congress which lawmakers could block only through a resolution of disapproval. It gives Obama nearly unilateral authority to raise the debt limit because it would require only 34 votes in the Senate or 146 votes in the House to sustain a veto of a disapproval resolution.
Reid is talking with McConnell about adding $1 trillion to $1.5 trillion in spending cuts to the authorizing legislation.
“It would include mostly low-hanging fruit,” said a Democratic aide, in reference to potential spending cuts which have already been discussed by Vice President Joe Biden and congressional leaders.
The leaders are also talking about adding a provision that would set up a special bipartisan committee in Congress that would recommend additional savings that could be brought straight to the floor for an up or down vote. The committee would be modeled on the Defense Base Closure and Realignment Commission (BRAC).
McConnell has asked that the special committee recommend its savings package by the end of this year while Reid prefers the recommendation come after the 2012 election.
The leaders are also negotiating how many times Congress would vote on resolutions of disapproval in reaction to the president’s requests to raise the debt ceiling. Another issue of contention is how much the president should recommend in spending cuts when he asks to increase national borrowing authority.
McConnell initially proposed that Obama recommend a package of cuts equal to each tranche of borrowing authority he requests. The plan called for him to ask for $700 billion in increased authority later this month, another $900 billion in the fall and a final request of $900 billion in the summer of 2012.
Democrats argue that if the fall-back plan includes $1.5 trillion in spending cuts up front, it should not be necessary for Obama to recommend another $2.5 billion in cuts. They also argue that the $1.5 trillion in up-front cuts should be able to cover $1.5 trillion in additional borrowing authority. If Republicans agreed, Obama would need to request to raise the debt limit once more before the election.
Obama and congressional leaders are negotiating on a parallel track a bigger deficit-reduction package that could be paired with a $2.5 trillion increase in the debt limit. But those talks appeared to break down Wednesday when Obama rebuked House Majority Leader Eric Cantor (R-Va.) and abruptly adjourned the meeting.
Senate aides said Reid and McConnell have not planned any meetings this weekend. Lawmakers and staff are expected to work throughout the weekend.
McConnell has also requested votes next week on the Cut, Cap and Balance Act and a balanced budget amendment to the Constitution. He and Reid are negotiating the schedule.