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Reid steps back as Obama, Boehner work toward debt-limit compromise

Senate Majority Leader: ‘I haven’t been in the day-to-day negotiations’

Updated Friday, July 22, 2011 | 10:48 a.m.

Harry Reid

Harry Reid

Barack Obama

Barack Obama

John Boehner

John Boehner

It’s official: Harry Reid is no longer part of the inner dealmaking circle — that club now exclusively belongs to President Obama and House Speaker John Boehner (and Eric Cantor too).

“The Speaker and President have been working diligently together,” Reid said this morning, as he announced he’d no longer be keeping the Senate in session over the weekend, because the plan he thought they had to push — a deal he’d worked out with the Republican Leader Mitch McConnell over the last week — was off, in favor of a grand compromise being ironed out between Obama and Boehner. “We in the Senate must wait for them.”

But this is no ordinary strategic decision; for Reid, this is force majeure.

“We’re doing our very best to keep a sense, on top of what’s going on,” Reid explained, adding “a lot of what’s going on, we don’t know. I haven’t been in the day-to-day negotiations.

“All I can say ... is as sincerely as I can, I wish them well. It’s sincerely important that we address the debt limit.”

Rumors were flying all day Thursday that Obama and Boehner had struck a deal to raise the debt limit by $3 billion, largely on the back of cuts. White House budget director Jacob Lew came to the Capitol Thursday afternoon to break the news to the Senate Democrats, he was met with what one Senator described to reporters as a “volcanic” reception.

Most Democrats in the Senate and House have maintained that they won’t consent to messing with entitlement programs — namely, Social Security, Medicare and Medicaid — unless Republicans consent to raising revenues by closing tax loopholes, ending subsidies for lucrative industries, and allowing the Bush-era tax cuts enjoyed by the very wealthiest Americans to expire.

But while Republicans haven’t completely quashed the idea of raising revenues somehow, they have largely shunned the idea of doing it through taxation.

Sensing the impending impasse, Reid and McConnell joined forces over the last two weeks to structure a back-up plan that appeared to be inching its way to the floor: senators were anticipating a first vote on it this weekend. That deal would have instructed the President to raise the debt ceiling in stages, mandated $1 trillion to $2 trillion of budget cuts, and allowed Republicans to avoid ever having to take a direct vote to raise the debt limit.

But that’s now off the table, as are other alternative proposals, such as the $4 trillion deal the Senate’s Gang of Six worked out (though the Gang is meeting, along with Senate leaders, this morning).

While the whole body’s technically been put on ice, Senate Democrats seemed to be more put off by the fact that they’ve been cut out of the process than Senate Republicans.

“If there’s a deal, it’s going to be between the President and the Speaker, and I think it should be,” said Nevada Republican Sen. Dean Heller, on the rationale that Boehner and Obama are the heads of their respective parties.

Heller’s not a Senator that was leaning toward compromise, though he said Friday morning that he “will always keep an open mind.”

Reid, however, has been Obama’s best ally in Congress, pushing through the administration’s health care bill, and even a tax plan that he didn’t much care for.

Previously, that meant he was very much in the inner loop. But now, it appears, Obama’s former mentor has been relegated to being Obama’s faithful minion -- and Reid may be too hard up to do anything but oblige.

Everything, these days, is being done with a long-term view toward the upcoming 2012 elections.

“[Reid] knows that if he wants the state to blue in November, it’s going to be with Obama’s money,” said University of Nevada, Las Vegas political science professor David Damore.

And not just the Silver State. Nevada is one of eight states where the race for the Senate is anybody’s guess — and Reid’s so neck-and-neck for the majority leadership with McConnell that he needs at least five of those races to swing Democratic if he’s going to maintain his position.

That requires a national effort, and Obama is the galvanizing figure for Democrats across the country. But his willingness to deal on some of the most precious issues to his party's bottom line is affecting his base slightly: according to a CNN poll, Obama's approval ratings dipped to 45 percent this week (from 51 percent in late April, right after the last government crisis). And the bulk of that change comes from respondents who said Obama's not liberal enough: they doubled in number since the last poll.

Obama repeated Friday morning, while speaking at a town hall in Maryland, that “any deal that we strike protects our core commitments”, listing those as: Medicare, Medicaid, Social Security, veterans’ benefits, student loans, medical care for poor kids (SCHIP), food stamps, and unemployment insurance, and reminding that “I’ve said we have to have revenues as part of the package.”

“Whether I like it or not, I’ve gotta get the debt ceiling limit raised,” Obama said. “Defaulting is not an option.”

But in the shorter term, Obama does need the Democrats too.

If his promises hold, a deal with revenues will not be able to get through the House of Representatives with only Republican votes, because a strong contingent of the GOP’s conservative and Tea Party-affiliated ranks will vote against any deal that has tax hikes in it — and some will vote against any deal that raises the debt limit, period.

The House Democrats are even more determined to protect entitlement spending, and balance cuts with revenues, than the Senate Democrats.

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