Defense Cuts Snarling Debt Agreement

By Dan Friedman and Megan Scully

Updated: July 31, 2011 | 7:52 p.m.
July 31, 2011 | 6:43 p.m.

Senate Majority Leader Harry Reid.

Senate Democratic leader Harry Reid of Nevada has signed off a compromise proposal to raise the federal debt ceiling, but congressional aides said on Sunday evening that a late push by House Speaker John Boehner, R-Ohio, to reduce defense cuts that the measure would force is a key remaining hurdle to an agreement.

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Reid spokesman Adam Jentleson said Reid “has signed off on the debt-ceiling agreement pending caucus approval,” as Democrats appeared to be trying to turn up pressure on Boehner. No briefings for either Democratic or Republican House or Senate members have yet been scheduled.

Two congressional aides said Boehner is holding out to reduce roughly $350 billion in cuts to defense spending that would be part of an initial $900 billion in deficit cuts tied to a debt ceiling increase of a similar amount. Boehner also is refusing to agree to an even split between cuts to defense and other spending that would be triggered if Congress failed to enact a deficit reduction plan produced by a special congressional committee or doesn't pass a balanced budget amendment, the aides said. Senate Minority Leader Mitch McConnell, R-Ky., has left negotiations on defense spending to Boehner, staffers in both parties said. A Democratic congressional aide said McConnell had also signed off on the deal. McConnell spokesman Don Stewart would not confirm the senator had agreed.

House Minority Leader Nancy Pelosi, D-Calif., continued to meet with House Democratic leaders on Sunday after Senate leadership left the meeting. And it was not clear if Pelosi and her members were on board with the potential compromise.

Congressional aides said Democrats also want Social Security and Medicaid exempted from the cuts imposed if Congress cannot act on a plan from the special committee. The cuts also could be applied to Medicare providers and insurers, rather than beneficiaries, the aides said.

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