House Republicans are finishing work on a new proposal to resolve the standoff over the debt ceiling. The proposal, set to be finished and crafted into the form of a bill by Sunday, will be in two parts. The first will combine a short-term increase in the debt ceiling with spending cuts. The second will lay the groundwork for a longer-term increase in the debt ceiling coupled with far-reaching deficit reduction.
"Senator Reid said on Friday that he is going to wait for us to move," says a well-informed GOP House aide. "So we'll move." Another well-informed aide confirmed the basic outline of what's happening.
Staff of the House Rules Committee is involved in the work, which is an indication that the process is nearing completion. Before any bill can be considered on the House floor, the Rules Committee must first pass a rule setting out the process for its consideration. Once the proposal is finished, it would likely be posted on the Rules Committee website, probably no later than Monday, so the committee could meet to consider it on Tuesday and it could be on the House floor by Wednesday.
Work on the new proposal was underway before negotiations with the White House blew up on Friday. Sources say the plan was being created last week, even as the House leadership devoted considerable time to passing the "Cut, Cap, and Balance" proposal. Once the Senate Democratic leadership blocked "Cut, Cap, and Balance," House leaders stepped up work on the new proposal. Right now, the new direction is believed to be the only way forward. "McConnell-Reid is just not a viable option in the House," the aide says, referring to Senate Minority Leader Mitch McConnell's complicated proposal to allow the president to increase the debt ceiling.
In a 2 p.m. Saturday conference call with Republicans, House Speaker John Boehner said that a new proposal was in the works, and that it would have two parts, but did not go into significant detail about what it would involve. Boehner told his fellow GOP lawmakers that he hoped to have something done by 4 p.m. Eastern Time on Sunday in time to reassure Asian financial markets, which open at that time.
It's unclear whether the new proposal would have any Democratic support. After a meeting between Boehner, McConnell, Reid, and House Minority Leader Nancy Pelosi, Reid released a statement saying, "I have said repeatedly…that I will not support any agreement that fails to raise the debt ceiling though the end of 2012." Asked about possible Democratic support, another Republican aide said flatly: "I don't know."