07.31.10

Reid Backs Emerging Debt Deal

The Senate majority leader has signed off on a compromise between the White House and congressional Republicans—the most promising sign yet that a bipartisan deal is near.

Hours after his own deficit-reduction plan was sidelined Sunday afternoon, Senate Majority Leader Harry Reid endorsed a compromise emerging between the White House and congressional Republicans that would avert a potential default on U.S. debt. The Democratic leader's thumbs up was the biggest sign yet that a bipartisan deal could be struck at the last minute after months of bickering and gridlock. 

"Senator Reid has signed off on the debt-ceiling agreement pending caucus approval," Reid spokesman Adam Jentleson said in a short statement that rattled around Capitol Hill with lightning speed.  

The development came just four hours after the Senate declined to advance Reid's own plan to cut the deficit by $2.4 trillion over 10 years and raise the nation's debt limit by $2.2 million. 

His endorsement signaled that the last best opportunity to avert a debt default rested with a plan to raise the debt limit and cut as much as $3 trillion in spending over the next decade, developed between Vice President Joe Biden and Senate Minority Leader Mitch McConnell.