Washington (CNN) — Democratic and Republican congressional leaders unveiled new deficit reduction plans Monday as top officials scrambled to bridge a cavernous partisan divide and raise the federal government’s debt ceiling before an unprecedented — and potentially devastating — national default.
Both plans provide a path to raise the debt ceiling through the end of 2012, but differ sharply in terms of their requirements for future congressional action and both tax and spending reform requirements.
President Barack Obama is scheduled to deliver remarks on the state of the negotiations at 9 p.m. ET, according to White House press secretary Jay Carney.
If Congress fails to raise the $14.3 trillion debt limit by August 2, Americans could face rising interest rates and a declining dollar, among other problems. As the cost of borrowing rises, individual mortgages, car loans and student loans could become significantly more expensive.
Officials also warn that, without an increase in the debt limit, the federal government will not be able to pay all its bills next month. Obama recently indicated he could not guarantee Social Security checks would be mailed out on time.
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