White House still sees path to debt compromise, says unlikely

By Rebecca Kaplan

July 28, 2011

The White House may be the last place in town where people still think that a grand deficit-reduction deal can be made, even if the chances are slim.

"That's not likely," White House press secretary Jay Carney admitted at Thursday's press briefing. "But it's available, if the political will is there. In the short term, there are other options to do what we need to do at the bare minimum, and then we can return in a serious way to tax reform and entitlement reform."

That's why the Obama administration has thrown its weight behind the bill put forth by Senate Majority Leader Harry Reid, D-Nev. They see it as the path that may lead to the grand bargain.

Consider what Carney said of Reid's bill, just seconds after saying he still thought that a compromise was on the table: Reid is "willing to allow for a mechanism which he thinks is very important, if we can't get the grand bargain now, it would make it a time-specific period where the committee would consider these options. He will hand over the reams of paper to that committee that could form the basis of serious entitlement reform and tax reform in a bipartisan way and certainly is willing to consider measures that are enforcement mechanisms to move that process forward."

As for seeing that the Reid bill makes it out of the Senate, through the House, and to the president's desk - an extremely tall order - that's another story.

The source of the White House's confidence seems to be the plethora of phone calls that flowed into the Capitol the day after President Obama's Monday night speech after he asked Americans to call their representatives and urge compromise. And polls have shown that Americans want both spending cuts and tax increases, the basis of the so-called grand bargain.

"We believe that the American people have made clear that they want a compromise. They are so frustrated by what they see as dysfunction here, as unnecessary fighting over issues that could be and should be easily resolved," Carney said on Thursday.

"We are now at a moment where those Americans who elected [lawmakers] to represent people in their home districts and states need to decide, you know, about, you know, what is the greater good here. Is it holding out to get exactly what you want? ... Or is it a compromise where nobody gets everything they want, but the cloud of uncertainty on our economy is lifted and we make some significant cuts in our deficit and set a mechanism to do even more? I think that is the compromise that people are looking for, and I believe, we believe, the president believes, that in the end that's the compromise we will get," Carney said.

But the administration may have to rely on changes to Boehner's bill that would be made in the Senate and then sent back to the House. While they've threatened to veto that bill, White House officials have repeatedly ducked the question of Boehner versus default. Carney calls it a "false choice."

"Nothing is not what will be the alternative here. Compromise will be the alternative. Everyone in this town, rather than everyone who is elected in this town, is on the hook for the economy."

By Rebecca Kaplan

July 28, 2011