Washington (CNN) -- Congressional leaders are hoping to vote Monday on a last-minute bipartisan deal to raise the federal government's debt ceiling while imposing sweeping spending cuts and narrowly averting an unprecedented national default.
The agreement calls for up to $2.4 trillion in savings over the next decade, raises the debt ceiling through the end of 2012 and establishes a congressional commission to recommend long-term fiscal reforms.
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The exact timing of the vote in the House and Senate remains unclear, but the measure needs to reach President Barack Obama's desk by Tuesday. If the $14.3 trillion debt limit is not increased by that point, Americans could face rapidly rising interest rates, a falling dollar and shakier financial markets, among other problems.
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"This process has been messy," Obama said in announcing the deal shortly before 9 p.m. ET Sunday. "It's taken far too long. I've been concerned about the impact that it has had on business confidence and consumer confidence and the economy as a whole over the last month.
"Nevertheless, ultimately, the leaders of both parties have found their way toward compromise," he said. "And I want to thank them for that."
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It remains unclear whether congressional leaders have the votes to ensure the bill's passage, particularly in the House. A number of Republicans are worried about cuts in defense spending and the lack of a required balanced-budget amendment to the Constitution. Democrats are livid over the extent of the deal's domestic spending cuts as well as the absence of any immediate tax hikes on wealthier Americans.
"We're very concerned that (the) bill that makes these big cuts and has ... not one red cent from the wealthiest people in our country -- no revenue," said House Minority Leader Nancy Pelosi, D-California, calling it "very disconcerting."
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The agreement revolves around a two-stage process.
The first stage includes $917 billion in savings, including a roughly $420 billion reduction in the national security budget. The cuts would be accompanied by a $900 billion increase in the debt ceiling.
Because of the pending Tuesday deadline, Obama would have immediate authority to raise the debt ceiling by $400 billion, which will last through September, according to the White House.
For the other $500 billion increase in the debt limit, Congress can vote on a resolution of disapproval subject to a presidential veto.
In the second stage, a special joint committee of Congress would recommend further deficit reduction steps totaling $1.5 trillion or more, with Congress obligated to vote on the panel's proposals by the end of the year.
The committee of 12 would include six lawmakers from each chamber, equally divided between Democrats and Republicans. The panel's recommendations would be due by November 23 and guaranteed an up-or-down vote without amendments by December 23.
The committee is expected to consider politically sensitive reforms to the tax code and entitlement programs, though Democrats and Republicans disagree on the likelihood of any eventual revenue increases.
If the committee's recommendations are enacted, Obama would be authorized to increase the debt ceiling by up to $1.5 trillion. If the recommendations are not enacted, Obama can still raise the debt ceiling by $1.2 trillion. At that point, however, a budget "trigger" would kick in, imposing mandatory across-the-board spending cuts matching the size of the debt-ceiling increase.
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The cuts would be split between defense spending and nondefense programs, an unpopular formula intended to motivate legislators to approve the committee's recommendations.
"You want to make it hard for (lawmakers) just to walk away and wash their hands," Gene Sperling, the director of Obama's National Economic Council, said Sunday. "You want them to say, if nothing happens, there will be a very tough degree of pain that will take place."
The final debt-ceiling increase in the agreement would also be subject to a congressional vote of disapproval that Obama can veto.
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* Barack Obama
* U.S. House of Representatives
* John Boehner
* U.S. Senate
* Harry Reid
The agreement calls for both houses of Congress to vote on a balanced-budget amendment, though it does not make a further increase in the debt limit subject to congressional passage of such an amendment -- something tea party conservatives were initially demanding.
In a key concession to Democrats, benefits from entitlements including Social Security, Medicaid and Medicare -- as well as veterans benefits -- will be exempt from any immediate cuts.
Leaders on both sides of the aisle concede the deal is far from perfect.
Sen. John McCain, R-Arizona, said Monday he worries the bill cuts too much in defense spending but stressed that does not mean he will refuse to support it.
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House Speaker John Boehner, R-Ohio, told his caucus the deal represents a sorely needed compromise but claimed a GOP victory for greater fiscal restraint.
"This isn't the greatest deal in the world," Boehner said, according to excerpts of his remarks. "But it shows how much we've changed the terms of the debate in this town."
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Senate Majority Leader Harry Reid, D-Nevada, emphasized that "no one got what they want" and "everyone had to give something up."
But this "is a great stride forward" that shows "we can succeed not in spite of our divided government but because of it," he said.
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The White House dispatched Vice President Joe Biden to Capitol Hill on Monday to gin up support among House and Senate Democrats.
"I'm going to tell them it's a great day," Biden said.
A recent CNN/ORC International Poll reveals a growing public exasperation and demand for compromise. Sixty-four percent of respondents to a July 18-20 survey preferred a deal with a mix of spending cuts and tax increases. Only 34% preferred a debt reduction plan based solely on spending reductions.
According to the poll, the public is sharply divided along partisan lines. Democrats and independents are open to a number of different approaches because they think a failure to raise the debt ceiling would cause a major crisis for the country. Republicans, however, draw the line at tax increases, and a narrow majority of them oppose raising the debt ceiling under any circumstances.