–Senate Majority Leader: Biden Now ‘Hopeful’ Accord Is Coming Together
–‘There Is No Agreement That Has Been Made’
–‘One Problem’ Could Unravel Debt Hike Accord
–Agreement Must Boost Debt Ceiling At Least Until Jan, 2013

By John Shaw

WASHINGTON (MNI) – Senate Majority Leader Harry Reid Sunday said
he’s now “cautiously optimistic” that an agreement can be reached today
on a plan to increase the debt ceiling and cut budget deficits.

In remarks on the Senate floor, Reid said he has spoken with Vice
President Joe Biden several times Sunday and the vice president is
“hopeful” an agreement is within reach.

But Reid also offered cautionary words.

“There is no agreement that has been made … . We’re not there
yet,” he said.

He also warned that “one problem can stop the entire agreement”
from being concluded.

Reid said one requirement that Democrats will demand is that the
debt ceiling increase extend at least until January, 2013.

“Any agreement has to have a long-term approach,” he said. “This
will be done,” he said.

Reid took several tough jabs at House Republicans, saying their
week-long effort last week to pass a debt hike bill was a total waste of
time and has brought the U.S. to the brink of default.

“Compromise is the only way forward,” he said.

Reid indicated that the Senate’s procedural vote Sunday afternoon
is of little consequence. He said the underlying Senate bill will be the
vehicle to carry any debt limit compromise through both the Senate and
House in the coming days.

Reid’s remarks were similar to those made by Senate Minority
Leader Mitch McConnell who said on CBS’s “Face the Nation” Sunday that
Congress and President Obama are “very, very close” to an agreement to
increase the statutory debt ceiling and cut spending.

McConnell said there is a “potential agreement within our reach.”

McConnell indicated the agreement would increase the debt ceiling
until the end of 2012, cut spending by $1 trillion now and then cut
spending by about $2 trillion later in the year based on the work of
special congressional panel.

This panel would seek its cuts from both entitlement reforms and
tax reforms, McConnell said.

The Senate is scheduled to hold a procedural vote at 1 p.m. Sunday.

If a debt ceiling agreement is reached, it would be placed on this
bill pending in the Senate and voted on by the upper chamber, possibly
on Monday. It would then be sent to the House for a final vote.

Moving a consequential bill through both chambers in a few days
will be difficult, especially since it will require a complicated and
tenuous coalition of Democratic and Republican lawmakers to support it.

The U.S. has already reached its $14.29 trillion debt ceiling.
Treasury Secretary Tim Geithner has said that Congress must pass
legislation increasing the debt ceiling by August 2, this coming
Tuesday.

** Market News International Washington Bureau: (202) 371-2121 **

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