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Debt-ceiling compromise taking shape: What's in it?

The details of an emerging debt-ceiling compromise are unconfirmed and could change, but they appear currently to involve parts of Sen. Mitch McConnell's 'last choice' option, as well as a trigger to ensure promised spending cuts take place.

By Staff writer / July 31, 2011

Senate majority leader Harry Reid (D) of Nevada speaks from the floor of the Senate late Saturday at the Capitol in Washington.

Senate Television/AP

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Washington

After weeks of bitter words and punishing votes, congressional leaders are reporting progress toward a deal on the nation’s debt crisis, which is nearing its Aug. 2 deadline.

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Senate majority leader Harry Reid (D) of Nevada on Saturday postponed a 1 a.m. vote on his own plan to resolve the crisis, saying more time was needed to work out the details.

“There are negotiations going on at the White House now on a solution that will avert the catastrophic default on the nation’s debt,” he said in a surprise late-night statement on the floor of the Senate. “There are many elements to be finalized ... but I believe we should give everyone as much room as possible to do their work."

While details of the negotiations are unconfirmed, aides close to the talks say that a tentative framework includes a plan by Senate minority leader Mitch McConnell (R) of Kentucky to allow President Obama to raise the debt limit on his own, barring a highly unlikely two-thirds vote in both houses of Congress to block him.

The plan would also include corresponding cuts – $1 trillion immediately, and then another $1.8 trillion to be identified by a bipartisan commission later this year. This second round of cuts would include a trigger mechanism to ensure that the cuts are actually implemented.

Republicans want to ensure that that trigger does not include tax increases, and Democrats do not want to see a trigger that mandates continual domestic program cuts. A compromise may involve cuts to defense spending.

First signs of a breakthrough surfaced when Senate minority leader Mitch McConnell (R) of Kentucky told the Senate on Saturday that private talks had resumed with the White House over how to resolve the crisis.

“The fact is the only way we’re going to get an agreement before Tuesday is to have it with the president of the United States,” said Senator McConnell.

It’s a sharp turnaround for the Republican leader, who had publicly announced on July 12 that “as long as this president is in the Oval Office, a real solution is unattainable.” McConnell did not participate in debt talks last week between the president and House Speaker John Boehner (R) of Ohio.

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