Senate Talks Hit Snag, But There's Reason for Optimism

With Senate leaders now driving talks to reopen government and avoid a debt default, the discussion hit a snag Sunday over budget caps written into law in 2011. Despite the hitch, Senate Majority Leader Harry Reid wrapped up a rare weekend session on a positive note.

With just four days until the debt-ceiling deadline, Reid said he had a productive talk with Minority Leader Mitch McConnell and that he's "optimistic about the prospects for a positive conclusion."

"I wish I could give you all the details," Reid told a few reporters as he left the Capitol. "But that wouldn't be appropriate."

Earlier, senators clashed over spending caps in the continuing resolution. Senate Republicans argued their Democratic colleagues insist on a CR that would bust the Budget Control Act caps, but Democrats counter that they're on record supporting those caps through mid-November.

Also on Sunday, McConnell called on Democrats to support a proposal based on an offer from Sen. Susan Collins, R-Maine, and supported by Sen. Joe Manchin, D-W.Va., that includes a six-month extension of the continuing resolution, a three-month debt-limit extension, and a delay of the medical-device tax.

"It's time for Democrat leaders to take 'yes' for an answer," McConnell said in a statement.

A group of Democratic senators, including Heidi Heitkamp, D-N.D., Mark Pryor, D-Ark., Amy Klobuchar, D-Minn., Joe Donnelly, D-Ind., and Manchin, as well as Angus King, I-Maine, called the negotiations "productive," but said there's no agreement.

Despite the disagreement, just the latest in a publicly partisan brawl to restart government and steer the country away from default, lawmakers say their leaders have at least focused on the right questions—a suggestion that Congress have moved away from re-litigating the Affordable Care Act.

"If we can get the adhering to the Budget Control Act caps back where they should be, which is again settled law, my sense is the negotiations could move ahead pretty quickly," said Sen. Bob Corker, R-Tenn.

At issue, according to Senate Democratic and Republican aides, is the length of time for a continuing resolution to fund appropriations and for an extension of the debt limit.

Republicans want as long a CR as possible, up to a year. The thinking is that the longer the CR goes, the more secure are the spending cuts locked in during the 2011 Budget Control Act. On the debt limit, though, Republicans want a brief extension to allow for a fuller debate on spending cuts and entitlement reform.

Democrats, on the other hand, want the opposite. They seek a shorter-term CR so they can, the hope is, get to a budget conference and reset the top-line spending figure. Democrats want a longer debt-limit extension to avoid the kinds of cuts they view as painful.

Reid dismissed the notion that Democrats want to bust the so-called BCA caps.

"Any talk about breaking the caps is not anything that came from us," Reid said.

Still, Republicans see it differently.

"I think between the White House possibly pulling back Senate Democrat leadership two nights ago and then just conversations in their caucus—I think there's been a little bit of a step back from the settled law of the Budget Control Act," Corker said.

The GOP position prompted a swift reply from Democrats who point to the CR as evidence that they voted to keep the caps.

"The suggestion that Democrats insist on breaking the budget caps is false and belied by the facts," said a Democratic Senate leadership aide. "Democrats all voted for the Senate-passed short-term CR at current sequester levels."

Senate Democrats supported a CR at an annualized rate of $986 billion, which tracked with the House's figure as well, but they're eager to go to a budget conference to fight for their higher top-line figure of $1.058 trillion.

Despite the "step back," Corker said he's hopeful Reid and McConnell would be able to work out an agreement "by the time we all go home tonight."

McConnell, according to an aide, was not at the Capitol, but could come in at a moment's notice if needed and was available by phone.