The first indication of a softening of the hard lines that have marked weeks of partisan wrangling over the debt limit came in the afternoon when the two leading Congressional Republicans announced that they had reopened fiscal talks with the White House and expected their last-ditch drive to produce a compromise. 
 
 Advertisement Continue reading the main story 
 
 Following the House’s sharp rejection of a proposal by Mr. Reid to raise the debt limit and cut spending, Senator Mitch McConnell of Kentucky, the Republican leader and a linchpin in efforts to reach a deal, said he and Speaker John A. Boehner were “now fully engaged” in efforts with the White House to find a resolution that would tie an increase in the debt limit to spending cuts and other conditions. 
 
 “I’m confident and optimistic that we’re going to get an agreement in the very near future and resolve this crisis in the best interests of the American people,” said Mr. McConnell, who noted he was personally talking to both Mr. Obama and Vice President Joseph R. Biden Jr., a favorite partner in past negotiations. 
 
 Mr. Boehner, who would have to steer a compromise through the House, said he based his confidence on the prospect of an agreement on the sense that “we’re dealing with reasonable, responsible people who want this crisis to end as quickly as possible.” 
 
 Advertisement Continue reading the main story 
 
 A Democratic official with knowledge of the talks said that Mr. McConnell called Mr. Biden early Saturday afternoon, the first conversation between the two men since Wednesday. The official said they talked at least four more times on Saturday as they tried to work out an agreement. 
 
 Advertisement Continue reading the main story 
 
 The deal they were discussing, this person said, resembled the bill that Mr. Boehner won approval for in the House on Friday more than it did the one that Mr. Reid had proposed. 
 
 Advertisement Continue reading the main story 
 
 It would immediately raise the debt ceiling by about $1 trillion, accompanied by a similar range of spending cuts, and set up a new bipartisan committee that would work to find deeper cuts in exchange for a second debt limit increase that would extend through the 2012 election. 
 
 A failure of the new committee to win enactment of its proposal could then set off automatic spending cuts across the board, including to entitlement programs. Other ideas were swirling around the Capitol as lawmakers searched for a way to avoid default. One of Mr. Reid’s top lieutenants said he saw at least a glimmer of hope. 
 
 “We are a long way from any sort of negotiated agreement,” said Senator Richard J. Durbin of Illinois, the No. 2 Senate Democrat, “but there is certainly a more positive feeling about reaching an agreement than I’ve felt in a long time.” 
 
 Advertisement Continue reading the main story 
 
 The flurry of activity came as anxiety built up in many corners, including among Wall Street investors worried about the effects on the markets and active-duty soldiers worried about their paychecks. 
 
 Advertisement Continue reading the main story 
 
 After Mr. McConnell sounded a hopeful note, Mr. Reid called members of the Senate to the floor to hear him dispute the claims by his Republican counterpart and accuse Republicans of failing to enter into serious negotiations even as the Treasury risked running out of money to pay all its bills after Tuesday. 
 
 “The speaker and Republican leader should know that merely saying you have an agreement in front of television cameras doesn’t make it so,” Mr. Reid said after returning from a visit to the White House with Representative Nancy Pelosi of California, the Democratic leader in the House. 
 
 Photo 
 
 Trying to build momentum for his own proposal, Mr. Reid and fellow Democrats were working to win over Republican senators to support his plan to raise the debt ceiling through 2012 and circumvent Mr. McConnell. 
 
 Advertisement Continue reading the main story 
 
 “Americans are watching us and demanding a result that is balanced,” Mr. Reid said. 
 
 The Senate Democrats’ efforts were set back Saturday when 43 of the 47 Republican senators signed a letter to Mr. Reid saying they would not back his proposal, which would allow a $2.4 trillion increase in the debt ceiling in two stages while establishing a new Congressional committee to explore deeper spending cuts. The numbers signaled that without changes in the plan, Mr. Reid would not be able to overcome a Republican filibuster, which requires 60 votes. 
 
 Newsletter Sign Up Continue reading the main story Please verify you're not a robot by clicking the box. Invalid email address. Please re-enter. You must select a newsletter to subscribe to. Sign Up Receive occasional updates and special offers for The New York Times's products and services. Thank you for subscribing. An error has occurred. Please try again later. View all New York Times newsletters. 
 
 House Republicans signaled their disapproval of the Reid plan by holding a symbolic vote on Saturday, rejecting it by a 246 to 173 vote, in a move intended to show it had no chance of passing in that chamber. About a dozen Democrats joined Republicans in rejecting the Reid plan. 
 
 Advertisement Continue reading the main story 
 
 The pre-emptive vote could strengthen Mr. McConnell’s hand as he seeks to shape any final compromise. 
 
 At the White House and in talks in Congressional offices and corridors, most of the attention was focused on finding a way to define the precise conditions under which the president could get a second increase in the debt limit that would be needed early in 2012 under both Republican and Democratic proposals. Officials in both parties said another idea that had surfaced was to require a change in Social Security policy if the new committee deadlocked, providing an incentive for the new committee to act on its own. 
 
 Advertisement Continue reading the main story 
 
 Under the proposal that the Congressional Budget Office said could save more than $100 billion over 10 years, a different measure of inflation would be used to calculate the annual cost-of-living adjustment in Social Security benefits. Supporters say the alternative measure of inflation is more accurate because it reflects what happens when prices rise; advocates for the elderly say the proposal is a backdoor way of cutting benefits. 
 
 Advertisement Continue reading the main story 
 
 Members of both parties took the floor to push for compromise, noting that the two sides were not far apart on major elements of their deficit-reduction plans. 
 
 “Failure should not be an option for us in this case, and it’s time we started finding common ground,” said Senator Johnny Isakson, Republican of Georgia. 
 
 Advertisement Continue reading the main story 
 
 The unusual Saturday session came after a week of brinkmanship on Capitol Hill. On Friday, Mr. Boehner managed to pass his own House bill, along party lines, just a day after suspending the vote as the Republican leadership tried frantically to line up enough votes for passage. But the Senate swiftly rejected that plan late Friday. 
 
 Advertisement Continue reading the main story 
 
 While some of the back-and-forth between the House and Senate and the party leaders was typical of the late stages of a negotiation, the combative and unyielding tone in both chambers of Congress was creating more pessimism in the rank and file about the prospects that a final agreement could be struck and cleared before Tuesday. 
 
 Even if a measure is able to win significant bipartisan endorsement in the Senate, the reception in the House could be different with the Treasury Department’s Tuesday deadline for increasing the debt limit at hand. But how to push a plan by House conservatives remained a major question mark. 
 
 Advertisement Continue reading the main story 
 
 At the Treasury Department, Secretary Timothy F. Geithner met with top advisers on Saturday on contingency plans for managing the financial consequences of Congressional inaction. “No one will be pleased,” said one adviser, who spoke on the condition of anonymity. 
 
 The Treasury Department calculates that the government will exhaust its ability to borrow money at the end of Tuesday, forcing the government to pay its bills from a dwindling pile of cash. Independent analysts estimate the government has enough money on hand to pay all of its bills for another week, more or less, before it starts missing payments. 
 
 Mr. Obama has repeatedly called on Congress to raise the borrowing limit, known as the debt ceiling, by Tuesday to avoid any uncertainty about the government’s ability to meet its obligations. Financial markets are particularly concerned about the payment of interest on the federal debt. A default on those obligations could precipitate a global financial crisis. 
 
 Advertisement Continue reading the main story 
 
 The painful negotiations to resolve the crisis have caught the attention of troops in Afghanistan, where Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, was quizzed repeatedly on Saturday by soldiers and Marines worried about their paychecks. 
 
 In Kandahar and Helmand Provinces, Admiral Mullen said it remained uncertain where money would be found if the government defaulted. Regardless of budget talks in Washington, the mission for American troops in Afghanistan would not halt, he said. 
 
 Advertisement Continue reading the main story 
 
 “We’re going to continue to come to work,” he said. ||||| Senate Majority Leader Harry Reid (D-Nev.) delayed a vote on his plan to raise the debt ceiling late Saturday to give President Obama and GOP leaders more time to strike an agreement. 
 
 But the delay could imperil the chances of passing legislation to raise the debt limit by Aug. 2, a deadline set by Treasury Secretary Timothy Geithner for avoiding a federal default. 
 
 ADVERTISEMENT 
 
 ADVERTISEMENT 
 
 A senior Senate GOP aide estimated Friday that leaders would have to reach a deal by 1 a.m. Sunday morning in order to push it through the upper chamber and get it to the House by Tuesday.Leaders will have to rely on the goodwill of every member of the upper chamber to agree to unanimous consent to speed legislation through the Senate in time to make the deadline.The senior GOP aide said members of the Tea Party Caucus who have been resistant to raising the debt ceiling would not drag out the floor procedure to delay a deal sanctioned by Democratic and Republican leaders.A congressional source said Saturday night that Obama and GOP leaders had reached a tentative deal that would raise the debt limit by between $2.4 trillion and $2.8 trillion.It would include spending cuts of about $1 trillion and set up a select bicameral committee to recommend a second deficit-reduction package worth between $1.4 trillion and $1.8 trillion by Thanksgiving.If Congress fails to approve the committee’s recommendations, cuts to Defense and Medicare would go into effect automatically, giving both parties incentive to reach a later agreement.The Medicare reforms would not include cuts to beneficiaries. Instead, the tentative deal would trim payments to healthcare providers and insurance companies, according to an aide familiar with the talks.Senate Republicans would likely be given a vote on a balanced-budget amendment to the Constitution as part of the final deal.Reid said White House officials asked him to postpone a vote on legislation he crafted to raise the debt ceiling by $2.4 trillion and cut spending by an equal amount.Many details of the tentative bipartisan deal remain unresolved, according to Reid.“There are many elements to be finalized and there is still a distance to go before any arrangement can be completed,” Reid said.“I believe we should give everyone as much room as possible to do their work,” he said. “I spoke to the White House quite a few times this evening, and they’ve asked me to give everyone as much time as possible to reach an agreement, if one can be reached.”Reid postponed a vote to end a GOP filibuster of his plan until 1:00 pm Sunday. The Senate adjourned at 10:13 p.m. Saturday and will reconvene at noon Sunday.Senate Republicans had accused Reid of forcing a vote early Sunday morning in a deliberate attempt to run out the clock on bipartisan leadership negotiations. They saw it as a part of an effort to pressure moderate Republicans to go along with his own plan to raise the debt limit.“Democrats are running out the clock. They want to delay the hard work of negotiation until the Aug. 2 deadline they’ve been warning us about all summer,” said Senate Republican Leader Mitch McConnell (Ky.).Reid took to the floor Saturday afternoon to announce that Obama was not close to reaching a deal with House GOP leaders.“The Speaker and the [Senate] Republican leader held a press conference to announce they’re in talks with the president and that a bargain to raise the debt limit is in the works and is close,” Reid said. “Members of the Senate, that is not true.”Reid reported that he had spent two hours with Obama and Vice President Biden and asserted that Republicans “still refuse to negotiate in good faith” because they refuse to allow potential tax increases.McConnell and House Speaker John Boehner (R-Ohio) offered a bullish assessment earlier in the day, surprising some senior Democrats who did not realize there was any substantial progress.Democrats took to the Senate floor Saturday night to urge Obama to use unilateral executive authority to increase the debt limit.As the deadline approaches, they have become increasingly anxious over the partisan deadlock on an agreement.“If we fail this, I hope the president will invoke the 14th Amendment and everyone should read it. It says the debt of the United States shall not be questioned. And if we can’t get together, the president will have to take that responsibility,” Sen. Barbara Boxer (D-Calif.) said.But McConnell seemed confident Saturday that he and Boehner would be able to reach agreement with Obama.“Our country is not going to default for the first time in our history — that is not going to happen — we now have a level of seriousness and the right people at the table that we needed and thought we had, as the Speaker indicated last week,” McConnell said at a Saturday press conference.McConnell’s announcement sparked alarm among some rank-and-file Democrats who were surprised by media reports nine days ago that Obama and Boehner were close to a deal that would have cut entitlements.White House budget director Jack Lew insisted to Democrats at a private meeting on July 21 that there was no deal, but the next day senior administration officials told reporters that they were in fact very close to hatching an agreement.One liberal Democratic senator said he hoped that House Democrats would act as a backstop and derail an agreement which would cut Medicare substantially without offering the possibility of raising taxes.If Obama and GOP leaders cannot finalize an agreement, Reid will move ahead with his own plan, which would not touch entitlement programs. He has reached out to moderate Republicans in hope of persuading at least seven of them to support his plan.So far, Sen. Scott Brown (R), who is facing reelection next year in Massachusetts, has signaled he would vote for Reid’s proposal.Forty-three Senate Republicans signed a letter to Reid on Saturday declaring their opposition to his debt-ceiling legislation. That opposition left Democrats short of the 60 votes needed to end a filibuster, virtually assuring the defeat of Reid’s plan when it came up for a scheduled vote.Earlier Saturday, House Republicans resoundingly rejected a version of Reid’s debt plan in a 173-246 vote. Every Republican in the chamber voted against it, while all but 11 Democrats voted in favor.However, Reid says there are more GOP lawmakers in play in the Senate than indicated by McConnell’s letter.“One of the people who signed that letter has met with one of my Democratic senators,” Reid said. “A number of them have already agreed to work with us.” 
 
 Last Updated at 12:16 a.m. 
 

– It's either a sign that a last-minute deal is truly in sight or one last tease: Harry Reid has postponed a 1am procedural vote on his plan to raise the debt ceiling until tomorrow afternoon, reports the Hill. Reid says the delay is intended to give negotiations with Republicans under way at the White House more time to play out. The Senate majority leader, who didn't appear to have the 60 votes necessary to prevail anyway, says the postponement came at the request of the White House because the talks were making progress. “There are many elements to be finalized and there is still a distance to go before any arrangement can be completed,” Reid said. “But I believe we should give everyone as much room as possible to do their work.” (Earlier, Mitch McConnell had sounded much more optimistic than Reid about a potential deal.) The New York Times and the AP see Reid's delay as an optimistic sign.