For debt-ceiling deal to become law, what needs to happen by Tuesday

In a rare moment of relief, Senate leaders rushed together to the floor Sunday night to announce a historic debt agreement, and Asian financial markets, just opening, rallied.

But selling the deal to a critical mass of rank-and-file lawmakers is as formidable a political reach as breaking the bitter, partisan impasse among top leaders – and it all must be wrapped up by Tuesday, when the United States loses its borrowing capacity.

Many conservatives say the deal doesn’t go far enough to ensure that the US will shift to a more sustainable fiscal course, including a balanced-budget amendment. Some liberals say that the richest Americans have not been required to share the sacrifice by paying more taxes.

Senate leaders meet with their respective caucuses to explain the debt-ceiling deal Monday morning. House minority leader Nancy Pelosi (D) of California – already facing defections from the Congressional Black Caucus and the Congressional Progressive Caucus – meets with Democrats in the afternoon.

House Speaker John Boehner (R) of Ohio, who held a conference call with House Republicans Monday evening, has what may be the heaviest lift: to find a majority within the majority that includes many lawmakers pledged to opposing a hike in the debt limit on principle. Speaker Boehner would put his credibility with conservatives at risk if he were to win this vote mainly with Democratic support.

“Sometimes it seems our two sides disagree on almost everything,” said Senate majority leader Harry Reid (D) of Nevada on Sunday evening. “But in the end, reasonable people were able to agree on this: The United States could not take the chance of defaulting on our debt, risking United States financial collapse and worldwide depression.”

Minutes later, President Obama laid out details of the deal, which capped weeks of intense, often bitter negotiation and speculation that Congress might be too wrapped up in partisan rancor to get it done.

In June, GOP negotiators walked out of debt talks with Vice President Joe Biden, after a dispute over tax hikes that Republicans say must be off the table. In July, Boehner walked out of private talks with President Obama, both citing disputes over proposed tax hikes.

But in a surprise move, Senate Republican leader Mitch McConnell announced on Saturday that he was negotiating directly with the president and Mr. Biden.

“I became convinced that even though my friend, [majority leader Reid], and I would love to work this out, we can’t do it by ourselves,” he said on the floor. “It has to have the only person who can sign something into law. There are 307 million Americans, but only one can sign something into law.”

The deal, as outlined by Mr. Obama Sunday night, provides an initial $900 billion hike in the debt limit while also enacting spending cuts at least that robust – a key principle for Republicans. Democrats, who lost the argument, said that revenue increases must be part of deficit cutting to ensure that the burden of raising the debt limit doesn’t just fall on the neediest Americans who rely on government programs.

A second round of spending cuts would be taken up by a new joint legislative committee, which would identify ways to cut the deficit by another $1.2 trillion to $1.5 trillion over the next 10 years. A related $1.2 trillion debt-ceiling hike would be automatic, unless two-thirds of either the House or Senate disapproves. That deliberately high legislative hurdle, first proposed by Senator McConnell, meets Obama’s top priority: that Congress not set up another bruising battle over raising the debt ceiling before the 2012 presidential elections.

Much of the rank-and-file opposition to the plan focuses on this second round of spending cuts, because it is not clear how the new legislative panel will interpret its mandate. Under the plan, the panel must report to Congress on its proposed cuts by Nov. 12. Congress then has a month to vote the proposal up or down on a fast track that, as for recommendations of base-closing commissions, bars amendments and filibusters.

“In this stage, everything will be on the table,” said Obama in his White House statement on the deal on Sunday. This would include tax breaks and special deductions for corporations and the wealthy, objectionable to Republicans, and “modest adjustments to programs like Medicare,” which many rank-and-file Democrats oppose.

But in a conference call with House Republicans on Sunday evening, Boehner assured members that tax cuts were still off the table. “There is nothing in this framework that violates our principles,” he said, according to excerpts provided by Boehner aides. “It’s all spending cuts. The White House bid to raise taxes has been shut down.”

“Now listen, this isn’t the greatest deal in the world. But it shows how much we’ve changed the terms of the debate in this town,” he added.

Should the committee fail to achieve at least $1.2 trillion in deficit reduction for fiscal years 2013-21, the plan mandates automatic, across-the-board cuts to make up the difference. These automatic cuts are deliberately controversial as an incentive for the committee to do its work. They target mandatory spending favored by Democrats, such as Medicare, as well as defense spending favored by Republicans.

It’s this aspect of the plan that sparked much of the initial negative comment across the political spectrum.

Lawmakers on the left are roiled that the plan does not demand more sacrifice from the wealthy. Sen. Bernard Sanders (I) of Vermont calls plans that “balance the budget on the backs of struggling Americans” without raising taxes on the wealthiest “grotesquely immoral.”

Conservatives, especially House tea-party activists, worry that without passing a balanced-budget amendment, Congress leaves its ambitious cutting goals open to the whims of a future Congress, which could rewrite the law or refuse to deliver the cuts.

Sen. Joseph Lieberman (I) of Connecticut worried that the debt agreement will “disproportionately cut defense spending and result in unacceptably high risk to our national security,” said spokesman Marshall Wittmann, in a statement.”

Congressional leaders hope to ease concerns of enough of these critics to move to votes on the legislation by Monday night.