July 24, 2011 / 12:12 AM / 6 years ago

Snapshot: Developments in U.S. debt talks

WASHINGTON (Reuters) - Here is what is happening on Sunday as lawmakers try to close in on a deal to raise the $14.3 trillion U.S. debt limit by August 2 and avoid a credit default:

* U.S. House of Representatives Speaker John Boehner tells Fox News Sunday that House Republicans are prepared to push through their own deficit reduction package if congressional leaders fail to produce a bipartisan plan by Sunday afternoon. That would be just hours before financial markets open in Asia. With time running out, the Democratic-led Senate might have no choice but to accept what the Republican-led House passes this week.

* White House Chief of Staff Bill Daley tells NBC’s “Meet the Press” that any short-term deal to raise the debt limit would harm the economy because financial markets and business leaders would not have the certainty they need to make investment decisions. Democrats want a debt limit extension through the 2012 presidential election year.

* Treasury Secretary Timothy Geithner tells CNN’s “State of the Union” that it is important to remove the threat of default for at least the next 18 months.

* Senator Tom Coburn, who has shown a greater willingness to compromise on tax increases than many of his fellow Republicans, tells NBC’s “Meet the Press” he sees only a short-term debt extension passing Congress and that President Barack Obama, who objects to a short-term deal, will have no choice but to sign it.

* Congressional leaders are expected to continue negotiations on Sunday. Republicans are pushing a two-step plan that would raise the debt ceiling and cut deficits. The first step would provide a downpayment on spending cuts and provide the government with enough borrowing authority to get through the rest of the year while lawmakers work on additional deficit reduction.

Reporting by Donna Smith; Editing Christopher Wilson

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