updated 7/27/2011 4:51:50 PM ET 2011-07-27T20:51:50

Six days away from a potentially calamitous government default, House Republicans appeared to be coalescing Wednesday around a work-in-progress plan by House Speaker John Boehner to increase the U.S. borrowing limit and chop $1 trillion in federal spending. But the White House dismissed the proposal as a waste of time, and it got a thumbs-down from Senate Democrats and tea party activists, too.

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It was a telling illustration of the difficult politics along the pathway to a deal in a standoff that has put financial markets on edge. Stocks were falling sharply Wednesday.

GOP leaders worked to line up support for Boehner's proposal, which was being retooled after nonpartisan analysts in the Congressional Budget Office said it would cut spending less than he had estimated — about $850 billion over 10 years rather than $1.2 trillion. The House planned to vote on the reworked plan Thursday, with Boehner calling it "the best opportunity we have to hold the president's feet to the fire."

First Thoughts: Boehner is boxed in

White House spokesman Jay Carney dismissed all the focus on the GOP plan as a distraction.

"Why are we voting on measures that have no chance of becoming law?" he asked with exasperation. Carney said lawmakers should stop looking for an easy way out of the debt crisis.

"People keep looking for off-ramps," he said. "They don't exist."

Rep. Mike Rogers, R-Mich., said Republicans were gravitating toward Boehner's plan "in a big way." He and others cited changes being made in the bill to make sure spending cuts exceed added borrowing authority, and the fact that the House would soon vote on a balanced budget plan.

Senate Republican Leader Mitch McConnell said only Boehner's plan would resolve the crisis "in a way that will allow us to avoid default without raising taxes and to cut spending budget gimmicks."

Video: Chuck Todd: I think you'll see a 10, 20, 30-day extension

But Senate Majority Leader Harry Reid, D-Nev., dismissed the speaker's plan as a short-term measure that would leave the economy on shaky ground. He said it would not get one Democratic vote in the Senate, dooming it to failure and was merely "a big wet kiss for the right wing."

"It's not Democrats who have asked for a long-term solution," Reid said. "It's the economy. The economy has demanded it."

Reid was asked if there was a "drop-dead date" for a deal to pass the House, be amended by the Senate and reach President Barack Obama in time to avoid default.

"Magic things can happen here in Congress in a very short period of time under the right circumstances," he said.

Boehner's proposal caught criticism not just from Democrats but from the right as well.

Tea party activists gathered across the street from the Capitol on Wednesday and urged Boehner to reject any deal that doesn't include steep spending cuts — even if the U.S. defaults.

Tea Party Nation, one group within the loosely affiliated movement, issued an online call for Boehner to step down. But other tea party activists said the speaker needs time to strike a good deal. Tea Party Express strategist Sal Russo said that while Boehner was trying to "salvage some small steps to fiscal responsibility, we believe his proposals lack sufficient progress in getting America's economic future on a better footing."

Video: Analysis: GOP plan saves less than advertised

Reid's rival proposal would deliver budget savings of a little more than $2 trillion, a half-trillion less than promised but still more than under Boehner's plan, budget analysts reported. The Senate leader said he'd wait to see what the House did before bringing his plan to a vote.

House Democrats, for their part, focused on finding a fallback plan should the two sides fail to raise the debt ceiling before the government runs out of borrowing authority next week.

Rep. James Clyburn, a member of the Democratic leadership, said he told fellow Democrats that Obama should veto the House GOP plan for a short-term extension of the debt ceiling and invoke the Constitution's 14th Amendment, which says that the validity of the nation's public debt "shall not be questioned."

The White House has rejected resorting to this tactic, questioning its legality. But Democratic Caucus chairman John Larson said that with only days left before Treasury's borrowing authority lapses, "we have to have a failsafe mechanism."

Story: US may have way to cover bills after deadline, for week

Amid all the heated rhetoric, it was easy to miss the fact that the differences between the sides actually seemed to be narrowing.

Boehner's plan represents significant movement from a bill the House passed last week, this one requiring less of the long-term spending cuts that had made Democrats balk. And Reid no longer is insisting on having tax increases, anathema to Republicans, as part of any plan to cut deficits.

Boehner needs to do more than pump up the legislation, however. He has to shore up his standing with tea party-backed conservatives demanding deeper spending cuts to accompany an almost $1 trillion increase in the government's borrowing cap.

But Rep. Alan West, R-Fla., said Wednesday that Boehner's bill was picking up support even among conservatives.

"Nancy Pelosi, Harry Reid and President Obama are going to be surprised tomorrow night," he said. "I'll bet my retirement check on it. I'm a conservative. I'm going to support this."

Rep. Bill Huizenga, R-Mich., said he remained undecided, but predicted that the reworked Boehner plan was "about as good as it's going to get. That's a pretty strong argument."

The 'known unknowns' of Boehner's debt plan

Unless he can wrestle the situation under control, Boehner risks losing leverage in his dealing with Obama and the Democrats who control the Senate.

Reid said Boehner's original plan was destined to fail in the Senate and it drew a White House veto threat. But it was nevertheless framing the debate over how to reduce long-term deficits while raising the debt ceiling.

Tuesday's CBO analysis said the GOP measure would cut the deficit by about $850 billion over 10 years, not the $1.2 trillion originally promised. Even more embarrassing was a CBO finding that the measure, which would provide a $900 billion increase in the nation's borrowing cap, would generate just a $1 billion deficit cut over the coming year.

Boehner's plan would couple budget savings gleaned from 10 years of curbs on agency budgets with a two-track plan for increasing the government's borrowing cap by up to $2.7 trillion. The first increase of $900 billion would take effect immediately; the second could be awarded only after the recommendations of a special bipartisan congressional panel were enacted into law.

Story: S&P official: Credible deficit cuts proposed

The White House says Boehner's measure would reopen the delicate and crucial debt discussions to unending political pressure during next year's campaigns and risk more uncertainty in the markets.

Reid's plan, which would increase the debt limit enough to keep the government afloat past the 2012 elections, could emerge as the last viable option standing and could be modified with input from Republicans.

The head of a top credit rating agency said Wednesday the plans under consideration could bring the U.S. debt burden down to a level that would allow the country to keep its triple-A credit rating.

Standard & Poor's President Deven Sharma told a congressional panel that previous reports indicating that Congress would need to achieve $4 trillion in deficit cuts over 10 years to retain the country's top credit rating were inaccurate.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Video: Congress, behind the scenes

  1. Transcript of: Congress, behind the scenes

    BRIAN WILLIAMS, co-anchor (Washington, DC): And good evening from Capitol Hill in Washington tonight, where this fight over the looming financial crisis goes on on two fronts -- here in these corridors, and across the country on the Internet , on the airwaves -- while elected lawmakers, it should be said, engage in some high risk behavior. Tonight here they're still talking and they're counting votes and they're deciding what this fix should look like. We're here and we've been here all day, we should tell you, because we've been allowed behind the scenes. NBC News is taking on something that's never been allowed here before. We have filled the Hill with cameras and journalists all day long today for an hour-long special this coming Sunday evening showing a day in the life of this place. And while it was long scheduled, it just happened to arrive -- we were just happened to be here to record this epic battle, which of course is still going on tonight. We have been walking these corridors all day, and tonight we can show you some of what the congressional leaders told us here today. First of all, you don't look happy on the front page of the New York Times . It says, " Boehner 's grip on his caucus is put to test in standoff." Feel like you're being tested?

    Representative JOHN BOEHNER: It is a test. This is a -- this is a big step, trying to get control of our deficit and our debt, and trying to do it by the August 2nd deadline. So it's a big test.

    WILLIAMS: Some people who are friends of yours have said this isn't fair. Your job is to run your party. But there's another party in there, too. You have this tea party caucus that didn't come to Washington with the same values and the same...

    Rep. BOEHNER: No, it's not the -- it's not the tea party caucus. I mean, they're -- most of the freshman are, frankly, in pretty good shape. It would be more what I would describe as some hard-line conservatives who want more. I don't blame them. I'd want more, too. But this was an agreement between the bipartisan Senate leaders and myself. It is what's doable. And I think we can get there.

    WILLIAMS: Mr. Speaker, is it fair to say you have a bit of a rebellion on your hands? Or do you feel...

    Rep. BOEHNER: Oh, I've got a little rebellion on my hands every day. It comes with the territory.

    WILLIAMS: You're not worried?

    Rep. BOEHNER: Never let them see you sweat.

    Senator HARRY REID: I'm disappointed. I care about John Boehner . I think he's a good person. I've been disappointed that he's painted himself into this corner. It makes our job over here much more difficult. But I hope that the American people are going to learn pretty soon that we are able to work our way through this. We have to do it. And I am, as I've said, you know, I'm a trial lawyer. I tried cases for a long, long time, and tried to work out arrangements so everyone was happy or unhappy, but at least finish the case. Legislations are to compromise. That's who I am.

    WILLIAMS: Senator Majority Leader Harry Reid , of course speaker of the House before that, just part of our conversations with various members of the leadership here at the Capitol today. The


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