WASHINGTON — President Barack Obama, insisting "it's decision time," Thursday told congressional leaders they've got three options to resolve an impasse over the debt limit — and two may have support among leaders of both parties.
Obama told lawmakers he's still seeking the "largest deal possible," to cut the deficit by as much as $4 trillion and raise the debt ceiling, said a Democratic official familiar with the talks, but the president didn't rule out cutting the deficit by $2 trillion or a third option of doing "significantly less on the deficit" while still increasing the debt limit. The Democratic official spoke on condition of anonymity because of the sensitivity of the ongoing talks.
The president did, though, convey a sense of urgency, telling congressional leaders, "We need concrete plans to move this forward."
He told lawmakers to talk with their members, saying he wants them to identify a potential resolution over the next 24 to 36 hours, people familiar with the talks said.
A Republican aide familiar with the talks, who spoke on condition of anonymity because of the sensitivity of the negotiations, said House Speaker John Boehner repeated his concern that Obama was not offering a solution to cutting the nation's debt and pressed the White House on cutting spending.
But behind the scenes, congressional leaders were signaling a deal could be near.
Obama planned to hold his second press conference of the week — at 11 a.m. EDT Friday — to make his case to the public.
Thursday's meeting came as Treasury Secretary Timothy Geithner warned Congress that "we don't have much time" before the government is in financial trouble.
He emerged from an afternoon meeting with Senate Democrats with a terse message: The Aug. 2 deadline for raising the $14.3 trillion debt limit cannot be extended.
"We don't have much time. It's time to move," he told reporters, "... The eyes of the country are on us, and the eyes of the world are on us."
He later told congressional leaders meeting with Obama that the world's financial markets want the debt ceiling raised and the U.S. deficit addressed, a Republican aide familiar with the meeting said.
The Democratic official said Obama reiterated a "strong preference" for the "largest deal possible, with tough spending cuts, including entitlement reforms, and savings from the tax code." The administration also discussed extending the payroll tax cut , as well as extending unemployment insurance.
House Minority Leader Nancy Pelosi said after the meeting that the House Democratic Caucus backs Obama's "grand bargain" — saving up to $4 trillion while avoiding an unprecedented default crisis."
But, the Democratic official said, Obama also said that a "substantial deal of approximately $2 trillion would be possible if all sides were willing to give a little."
A third option, the official said, would be to do "significantly less on the deficit" while still ensuring a long-term increase in the debt limit.
The group, which has been meeting daily with Obama since Sunday, won't meet Friday, but the Republican official said Obama suggested another meeting over the weekend if the group couldn't reach a decision on its next step.
After the rancor of the past week, both sides took pains to describe the tenor of the meeting as constructive. The Democratic official called it "very cordial." The Republican called it a "composed and polite meeting."
Earlier in the day, Senate leaders from both parties were discussing a scaled-down solution, one modeled after the plan offered earlier this week by Senate Republican leader Mitch McConnell and backed by Senate Majority Leader Harry Reid.
House Speaker Boehner added momentum to the effort, telling a press conference McConnell's plan was "worth bringing to the table."
"What may look like something less than optimal today," he said, "if we're unable to reach an agreement, it might look pretty good a couple of weeks from now."
The plan first would have Congress give the president authority to present a debt limit increase in three stages. The first, prior to Aug. 2, would provide $700 billion in new authority, including a provisional $100 billion so the U.S. could avoid immediate default. Two separate $900 billion requests would follow later, probably next year.
Obama also would offer recommended spending cuts that would exceed the new debt limit increase, but they would not be binding. The debt increases would go into effect unless Congress disapproved, though if it did, Obama could veto the resolution of disapproval, and Democrats could sustain his veto.
There was talk Thursday, however, that mandatory cuts could be included.
"We would like to see, even if we can't get a grand deal, some real cuts be added to Senator McConnell's proposal," said Sen. Charles Schumer, D-N.Y.
The Democratic official familiar with the White House talks said there was "very little discussion of the McConnell-Reid proposal," describing it as a "a fallback option."
White House Press Secretary Jay Carney said before the meeting that the administration believes there's been progress. Obama set a Friday deadline for determining whether negotiators are "moving toward a significant bipartisan agreement on deficit reduction or not," Carney said.
"If we're not, then we have to begin looking at making sure that we fulfill our obligation to uphold the credit rating of the United States," Carney said.
Democratic leaders had blamed the talks' stalemate largely on House Majority Leader Eric Cantor, R-Va., with Reid saying on the Senate floor that Cantor should not even be involved in the talks. Cantor had accused Obama of storming out of the talks Wednesday, a suggestion the White House called "preposterous."
"The time for personal gain and posturing is over," Reid said.
Later, at a news conference, Reid was asked if a deal could be reached as long as Cantor was involved.
"House Majority Leader Eric Cantor has shown that he shouldn't even be at the table," Reid said. "Unless he changes, and starts being someone who contributes to the solution, the answer is no."
Cantor said at his own news conference, with Boehner by his side, that he and the speaker were "on the same page."
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