JUDY WOODRUFF: Congress and the president labored again today to break the debt-ceiling stalemate. There were conflicting signals, but no outward signs of movement.
NewsHour congressional correspondent Kwame Holman begins our coverage.
KWAME HOLMAN: The U.S. Capitol swirled today with claims of progress toward an agreement on cutting the deficit and raising the government's borrowing limit.
One report had it that House Speaker John Boehner and President Obama were close to a major deal, but, at the White House, Press Secretary Jay Carney quickly denied it.
JAY CARNEY, White House press secretary: There is no deal. We are not close to a deal. We are -- obviously, the president is in discussions with all the leaders of Congress, as well as other members, and exploring the possibility of getting the biggest deal possible.
There is the potential here for a significant agreement. There are obviously differences, as there have been throughout this process. We believe there is momentum behind the idea of a balanced approach to a significant agreement.
KWAME HOLMAN: Another report said the president and Boehner were discussing up to $3 trillion in cuts over 10 years with a promise of tax reform next year.
At his own briefing, Boehner sought to place the onus for getting any agreement on the president.
REP. JOHN BOEHNER, R-Ohio speaker of the House: The ball continues to be in the president's court. And it's been there for some time. If we're going to avoid default and prevent a downgrade of our credit rating, and if we're going to create jobs and jump-start the economy, I think he needs to step up and work with us on the spending cuts and reforms that the American people are demanding.
KWAME HOLMAN: The continuing stalemate, in public at least, produced a fresh warning from the U.S. Chamber of Commerce, a longtime ally of Republicans.
In a post on its website, the business group's number-two official wrote: "Jeopardizing our country's credit rating and fiscal security by refusing to compromise isn't the answer. The result from political inaction could be devastating."
And for a moment today, there appeared to be an opening from an influential conservative on increasing tax revenues. Anti-tax crusader Grover Norquist told The Washington Post's editorial board that letting the Bush era tax cuts expire wouldn't violate his organization's insistence on no new taxes.
He said, "Not continuing a tax cut is not technically a tax increase." But Norquist later backed off that statement, saying he still opposes any effort to do away with the Bush tax cuts.
Nonetheless, New York Sen. Chuck Schumer and other Democrats pushed House Republicans to reexamine their stance against tax hikes.
SEN. CHARLES SCHUMER, D-N.Y.: The House GOP is on iceberg that is melting into the ocean, and even Grover Norquist is offering them a lifeboat. The question is, for their own good and for the country's good, will they take it?
KWAME HOLMAN: As negotiations continued behind the scenes, the U.S. Senate today took up a House-passed bill that many Republicans want to see approved before they will accept an increase in the debt-ceiling. The so-called Cut, Cap and Balance bill would slash $6 trillion from the deficit over the next decade and require a balanced budget amendment to the U.S. Constitution.
The Senate's Democratic majority leader, Harry Reid, agreed to the vote, but said the legislation was a nonstarter.
SEN. HARRY REID, D-Nev. majority leader: Republicans so-called Cut, Cap and Balance plan doesn't have one chance in a million of passing the Senate.
KWAME HOLMAN: Reid insisted again that any deal has to be balanced with spending cuts and tax hikes. The Senate's top Republican, Mitch McConnell, was equally firm, saying spending is the main problem.
SEN. MITCH MCCONNELL, R-Ky. minority leader: The reason we have got a debt crisis is that government spends every cent it gets, and then some. Sending Washington more money will not solve the problem; it will enable it.
KWAME HOLMAN: Other Republicans said Cut, Cap and Balance was a take-it-or-leave it proposition.
SEN. MIKE LEE, R-Utah: And we want to make very clear, this isn't just the best plan on the table for addressing the debt limit; this is the only plan.
KWAME HOLMAN: Still, Speaker Boehner said most Republicans would be willing to compromise for the right deal.
REP. JOHN BOEHNER: Oh, I'm sure we have got some members who believe that, but I do not believe that would be anywhere close to the majority. At the end of the day, we have a responsibility to act.
KWAME HOLMAN: And even with the Aug. 2 deadline closing in...
REP. JOHN BOEHNER (singing): Zip-a-dee-doo-dah, zip-a-dee-ay.
KWAME HOLMAN: ... the speaker appeared in an upbeat mood, despite the apparent lack of movement.
JUDY WOODRUFF: I spoke with two members of the bipartisan Gang of Six, which has spent the better part of the past year trying to come up with a plan to tackle the debt.
Republican Sen. Saxby Chambliss of Georgia and Senate Budget Committee Chairman Kent Conrad of North Dakota joined me from Capitol Hill a short time ago.
Senators, thank you very much for joining us.
I want to ask both of you, today was filled with reports. First, there was a deal. Then there wasn't a deal. It was close. It wasn't close.
Sen. Conrad, to you first. What do you hear?
SEN. KENT CONRAD, D-N.D.: Well, we had Jack Lew, the head of the Office of Management and Budget, at the caucus today.
He said there has been no agreement struck. I don't believe there has been one at this point. Clearly, there are active negotiations. We know that it's not been determined what the way forward is at this point. But I think, at the end of the day, Judy, it's going to have to be something very close in terms of dealing with the debt to what the group of six has come up with, because it is the only bipartisan plan that has been developed that really gets the debt under control.
And, at the end of the day, I believe any plan that is agreed to in terms of dealing with debt will have to be pretty close to what we have done.
JUDY WOODRUFF: Sen. Chambliss, what are you hearing? And are you anything -- are you hearing anything that leads you to believe it's close?
SEN. SAXBY CHAMBLIS, R-Ga.: Well, first of all, I don't get that many calls from the White House, Judy. So I'm not sure what's going on down there.
But we are -- now, I think there is an indication that, because we're getting to the end of the road -- I mean, gosh, we're looking at Tuesday, a week, being D-Day. And, as always happens in this institution, the closer we get to that, the more the rumors fly, but, in all probability, the more serious the negotiations are right now than before too. But I don't have anything to add really from a reporting standpoint to what Kent had to say.
JUDY WOODRUFF: Well, Sen. Chambliss, we know you are close. However, you may not be getting calls from the president, but you are close to the speaker of the House, John Boehner. Are you hearing anything from him?
SEN. SAXBY CHAMBLISS: Not with respect to the negotiations today. I know they were having discussions probably off and on all day. And -- and I will be talking to John either tonight or in the morning. But I have not heard anything from him with respect to progress of the talks.
JUDY WOODRUFF: Sen. Conrad, there were reports at one point today that the president and the speaker were close to some sort of deal that would be $3 trillion, mostly or only cuts, with revenue raisers to come later.
If that were the shape of a deal, is that something that would sell with Democrats?
SEN. KENT CONRAD: You know, it's so hard to know without seeing what the actual contours of an agreement might be.
But I would say this to you. A plan like we have put together, I think, is the only one that has serious prospects for success. And I say that not just because we were involved. But, if you look at the history, fiscal commission, 11 members of the 18 agreed to a plan, five Democrats, five Republicans, one independent.
We have had the group of six negotiate for six months, three Democrats, three Republicans, very close in terms of overall direction to what the fiscal commission concluded. So, I think whatever one does to bring together a group of people, Republicans and Democrats, to negotiate a plan, they're going to wind up very close to what we have concluded.
And anything else doesn't have much of a chance. At least, that's my experience after 14 months of negotiating.
JUDY WOODRUFF: Well, I do want to ask you about your plan in just a moment.
But, first, one other question, Sen. Chambliss, about what we are hearing today. And that is, at one point, we were hearing that Budget Director Jack Lew was saying whatever the final plan is or the plan at this stage, it would have to include some form of revenue increase. Or is -- and my question to you is, is that something that would fly with your party, with Republicans?
SEN. SAXBY CHAMBLISS: Well, if it's a pure tax increase, Judy, I think the answer is clearly no. I think the House has made that very plain. My colleagues over here and I have made that very plain.
But, as far as increase in revenue, you bet. That's going to have to be a part of any plan to solve the long-term debt. And what Kent and the four others and I have worked on for so long, as you well know, has been focused on that $14.5 trillion debt.
We just happened to conclude our process at the same time that the debate over the debt-ceiling was being ratcheted up. And now, as a result of that, and with no viable plan out there, I think Kent is probably right. Something that we have agreed on, hopefully, can be the focal point of a way forward out of this.
JUDY WOODRUFF: But, Sen. Chambliss, do you believe the Tea Party members, especially those in the House, are likely to go along with that?
SEN. SAXBY CHAMBLISS: Well, if you couch it the way we have, if you put in real, meaningful tax reform at some point -- and that's a problem, getting that done, obviously, in the next 11 days -- but real, meaningful tax reform that lowers rates and energizes the economy and shows true economic growth in the long term, I mean, that's what we're all for.
So I can't imagine anybody being in opposition to that. Now, they are there are going to be outside groups that are going to be throwing arrows at all of us, irrespective of what we wind up with. But we have got to find that common ground of finding a way to reduce spending in the right way, be responsible about it, to increase revenues in the right way, be responsible about it, and reform entitlements in the right way.
And that is -- that is something that I don't think anybody in Congress is going to disagree with. We can disagree over the process, but not those three points.
JUDY WOODRUFF: But, Sen. Conrad, speaking of outside groups, the loudest criticism we're hearing in the last couple of days since your plan has surfaced is coming from liberal groups, who are saying it asks sacrifices from the middle class, while giving tax breaks to the high-income earners and corporations.
SEN. KENT CONRAD: Well, they have got it wrong.
Clearly, they have not read the plan or apparently don't understand it, because that's not what the plan does. What the plan does do is face up to the reality we're borrowing 41 cents of every dollar that we spend, that revenue is the lowest it's been as a share of our national income in 60 years, that spending is the highest it's been as a share of our national income in 60 years.
That means you have got to work both sides of the equation. And we have done that, and we have done that in a careful and fair way. And, at the end of the day, I think they will look back, once they understand the plan better, and realize this is as good a deal as they're going to get.
Look, the harsh reality is this. A failure to rightsize the entitlement programs means they are going to go broke. That's not our word. That's the word of the trustees of the programs themselves. Anybody that says you don't have to make any change is not telling the American people the truth.
And the truth is all of us are going to have to give some ground to solve this American problem. And it's in America's interest that we do so.
JUDY WOODRUFF: And, meanwhile, just quickly, Sen. Chambliss, the criticism from some conservatives is, yes, there is some criticism about any revenue in there, but also they say that it doesn't cut enough, and particularly with regard to health care, that if doesn't cut, which they point out is the fastest growing driver of the federal debt.
SEN. SAXBY CHAMBLISS: Well, certainly, if we could have found more ways to reform and modify health care programs, I would have been in favor of that.
But the weakest point of the president's debt commission report, in my opinion, is addressing the health care system. But we make some real reforms in there. And we have got some provisions that the Finance Committee can look at and say, if we have the opportunity now under the authority that's granted in our plan to really go into Medicare, save it and protect it -- and, as Kent said, it's going broke.
And that's not us saying that. That's independent, bipartisan groups saying that. And if folks really want to get serious about saving and protecting Medicare for the next generation, then this is the opportunity to do it. And we're going to give the Finance Committee the authority to do it in the right way.
Now, it's -- we're not getting everything we want. The Democrats are not getting everything they want. That's why you have to have common ground in order to find 60 votes in the Senate and a way forward to get 218 in the House.
JUDY WOODRUFF: Finally, a very quick comment from both of you on the timing of this. Is there a way to get some part of your plan passed in legislative form before this Aug. 2 debt-ceiling deadline and/or for the president to go along with, say, a short-term extension that would allow part or more of your plan to be passed, Sen. Conrad and then Sen. Chambliss?
SEN. KENT CONRAD: We believe there is. In fact, the group of six is meeting with top leadership of the Senate in moments. We will be outlining a proposal there.
We think there is a way to address the long-term debt challenge of the country at the same time as the debt extension is dealt with. And, remember, what we have worked on all this time wasn't a debt extension. We were focused on a plan to deal with the debt. And that's what we have done. And we're proud of the work we have produced.
JUDY WOODRUFF: Sen. Chambliss.
SEN. SAXBY CHAMBLISS: Well, we certainly hope so, Judy, because there is not a viable plan on the table right now that's going to garner enough votes in the Senate and the House.
And if the leadership can take part or all of our work product and use it for the benefit of America and Americans, then we're all for that. And we hope that can be done.
JUDY WOODRUFF: Gentlemen, we thank both of you.
Sen. Saxby Chambliss, Sen. Kent Conrad, we appreciate it.
SEN. KENT CONRAD: Thank you, Judy.
SEN. SAXBY CHAMBLISS: Thank you, Judy.