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Progress scarce as debt limit impasse continues

By Andrew Taylor

Associated Press

Published: Thursday, July 21 2011 9:02 a.m. MDT

From left, Sen. Charles Schumer, D-N.Y., Sen. Barbara Mikulski, D-Md., Sen. Tom Harkin, D-Iowa, and Sen. Barbara Boxer, D-Calif., participate in a news conference to denounce the House Republicans "Cut, Cap, and Balance Act" on Wednesday, July 20, 2011, in Washington.

Carolyn Kaster, Associated Press

WASHINGTON — The Senate has taken up tea party-backed House legislation tying an increase in the government's borrowing authority to a series of conservative demands including a constitutional balanced budget amendment.

Majority Leader Harry Reid, D-Nev., called up the measure to placate Republicans demanding a vote. But he said it "doesn't have one chance in a million of passing the Senate."

Democrats argue that the so-called "cut, cap and balance" measure would impose untenable spending restraints and set spending levels, as a percentage of the overall economy, on par with the mid-1960s — before the advent of Medicare and automatic Social Security cost-of-living adjustments.

The development Thursday reflected the reality that there's more talk than progress as official Washington wrangles daily over finding a way out of a debt dilemma that has the government sliding inexorably toward a first-ever default on its financial obligations.

President Barack Obama met with House Speaker John Boehner, R-Ohio, at the White House for 90 minutes on Wednesday, but neither side would comment afterward.

Senate Minority Leader Mitch McConnell said Thursday the legislation now before his chamber would be an opportunity for lawmakers to "go on record in support of balancing our books or against it." He urged Democrats to join GOP senators in backing it.

In brief remarks on the Senate floor, the Kentucky Republican assailed Obama for his "reckless spending habits" and wondered about the Democrat's recent attempts to "come across as a fiscal conservative."

Democrats are expected to kill the measure — which they say would demand debilitating cuts to Medicare — in a vote on Saturday if not before.

Meanwhile, momentum on a separate bipartisan budget plan by the Senate's "Gang of Six" seemed to ebb as critics warned the measure contains larger tax increases than advertised and it became plain that the measure comes too late and is too controversial to advance quickly — particularly as a part of a debt limit package that already would be teetering on a knife's edge.

Sen. Kent Conrad, D-N.D., a member of the Gang of Six, said Thursday that some 40 senators of both parties back the plan his group has brought forward. It generally takes 60 votes to pass legislation in the 100-member Senate because the rules permit unlimited debate unless a supermajority votes to limit it.

But Conrad also said he feels there's too little time between now and Aug. 2 to complete a comprehensive package of spending cuts, benefit program changes and an overhaul of the tax code.

Conrad said doing nothing is not an option, saying that "we're all going to have to do things we'd prefer in a perfect world not to have to do."

Absent a breakthrough between Obama and Republicans, there is a hotly contested backup plan by Senate Minority Leader Mitch McConnell, R-Ky., that would give Obama broad new powers to obtain increases in the government's borrowing unless blocked by veto-proof two-thirds margins in both the House and Senate.

Many conservative Republicans are in an uproar over the McConnell plan, and more than 70 House members signed a letter circulated by members of the conservative Republican Study Committee calling on Boehner to come out in public opposition to the McConnell-Reid plan..

In a shift, White House press secretary Jay Carney said Wednesday that Obama would back a short-term deal to prevent a disastrous financial default on Aug. 2 but only if a larger and still elusive deficit-cutting agreement was essentially in place.

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