Reid gets ‘last train’ ready to roll on debt

WASHINGTON -- With time running precariously short and the House in a deep stall, Senate Majority Leader Harry Reid said Friday morning he was preparing the "last train" to leave Congress with a solution to the debt crisis.

Reid said he planned to file a motion later in the day that would get the procedural clock running toward a key Senate cloture vote early Sunday morning, and possible further votes early Monday on what is shaping as a possible final deal to raise the government's debt limit and avert financial default.

The Nevada Democrat did not give details of what the legislation might look like as he seeks alterations to a bill he introduced this week to raise the government borrowing by $2.4 trillion -- enough to carry to March 2013 -- accompanied by $2.2 trillion in spending cuts and other savings.

That plan has been rejected by Republicans, who charge some of its planned savings are accounting gimmicks. Reid said he was appealing to GOP senators for proposals in a bid to attract votes.

Reid said he was open to almost anything as long as it extended borrowing authority beyond 2012. That includes extending the government's borrowing powers beyond 2012. Anything shorter is a non-starter, he said.

"We have the framework of a bill," Reid said. "We are going to change it."

Unless the voting process begins Friday, Reid said Congress cannot meet the Aug. 2 deadline by which Treasury Secretary Timothy Geithner has said the government will be unable to pay all its bills.

"The last train is leaving the station," Reid said.

At the White House, President Barack Obama declared "we're almost out of time" in the political standoff that has heightened fears of a market-rattling government default.

"The power to solve this is in our hands on a day when we've been reminded how fragile the economy already is," the president said as many U.S. stocks fell in response to a sour report on economic growth and widespread uncertainty over the Washington debt stalemate.

"This is one burden we can lift ourselves. We can end it with a simple vote," Obama said.

Credit rating agencies have warned that without significant action by Congress, they could downgrade the U.S. debt rating, adding billions of dollars to government borrowing costs and affecting households in the form of higher interest on mortgages, credit cards, car loans and other installment plans.

"Our economy cannot bear this kind of uncertainty any longer," Reid said in the Senate. "Congress and the White House are in lockdown and the business of the country is not being conducted."

In appealing for compromise, Reid hearkened back to his days as an attorney in Las Vegas.

"I have spent my life -- and I don't want anybody to take this as a sign of weakness -- I have compromised my whole life. When I practiced law that's what I did, try to represent people and get a result.

"I felt many times I was a failure when I went to court, but I went to court over a hundred times and tried cases before juries," Reid said. "I always believed compromise was the right thing to do, even in the law. As a legislator it is a sign of integrity and confidence."

Reid's comments came as House Republicans prepared to go back into session Friday and work toward a vote on an alternative debt plan sponsored by Speaker John Boehner, R-Ohio.

Boehner delayed and ultimately postponed a vote Thursday night on the bill after being unable to muster a majority within his party to vote for it, with the holdouts including a handful of tea party conservatives.

Friday, House leaders were sweetening the bill with stronger language calling for a balanced budget amendment to the Constitution. That was expected to win over enough Republicans to get the bill through the House, but Democrats said it would be quickly killed in the Senate.

"We cannot wait for the House any longer," Reid said "This is likely the last chance to save this nation from a default."

"No matter how long Republicans delay, the deadline will not move. We have hours to act."

The biggest sticking point is the House bill's call for congressional votes to raise the debt ceiling, in two stages, before the 2012 elections.

A $900 billion debt-limit hike would come first, coupled with $917 billion in spending cuts over 10 years.

Under the Boehner revision, approval of a balanced-budget constitutional amendment would open a path to another $1.6 trillion in borrowing power, provided that Congress and the president have agreed to another round of spending cuts of that amount or more.

The Associated Press contributed to this report. Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760. Follow him on Twitter @DadTetreault.