Leading Republicans acknowledged on Thursday that their plan to replace government health care for the elderly with a voucher system probably will have to wait as lawmakers and the White House bowed to political realities in pursuing a deal to continue government borrowing in exchange for big spending cuts.
Both sides hinted at movement and Vice President Joe Biden reported progress from an initial negotiating session.
Spending cuts and increasing the amount of money the government can keep borrowing to pay its bills are "practically and politically connected," Biden said at the start of budget meetings with lawmakers.
The House Republican whose committee oversees the health care program known as Medicare said he is open to other approaches besides the voucher plan that recently passed by the House after a contentious debate that appears to have hurt the party with older voters.
Rep. Dave Camp, the House Ways and Means Committee chairman, said he supports the Republican approach, but isn't willing to press for legislation that has no prospects of becoming law.
"I'm not interested in laying down more markers," said Camp. "I'm interested in solutions. ... Let's figure out where there is common ground and let's get there as soon as we can."
Asked about Camp's comments, House Speaker John Boehner, a Republican, said they are "a recognition of the political realities that we face." Nonetheless, Boehner said the Republican Medicare remake remains on the table.
Obama and lawmakers of both parties face an Aug. 2 deadline to enact legislation that permits the government to increase its borrowing authority and meet its obligations to lenders. Failure to raise the debt limit beyond the current $14.3 trillion would call into question the creditworthiness of the U.S. government and trigger economic crisis.
With the government borrowing more than 40 cents of every dollar it spends, Republicans see the need to increase the limit as an opportunity to make deep spending cuts. Benefit programs such as Medicare could face some cuts, but not the overhaul called for in the House Republican budget plan.
House Majority Leader Eric Cantor, a Republican, came to the talks with $715 billion in proposed savings from other benefit programs, including cuts to farm subsidies and food stamps, according to an aide.
The deficit could reach $1.6 trillion this year, so both sides are setting modest expectations. But they said the meeting offered a chance to identify even small cuts that can build toward a broader agreement.
Treasury Secretary Timothy Geithner took some pressure off the talks when he told Congress this week that the government can meet its obligations through Aug. 2, by using a series of bookkeeping maneuvers. That's nearly a month longer than the July 8 deadline Geithner had cited previously.
The government is borrowing an average of $125 billion a month.
House Republicans have passed a budget blueprint that aims to cut spending by more than $5 trillion over the next decade. Biden sought to flesh out a plan that President Barack Obama outlined last month that would reduce deficits by $4 trillion over 12 years.
Obama's proposal calls for about $1 trillion in higher tax revenues, a nonstarter with House Republicans.
Negotiators planned to meet again Tuesday.
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