Senior White House Official: 50/50 Chance This Won't Be Resolved By This Time Next Week

A senior White House official says that there's a 50/50 chance that the current deficit reduction mess will not be resolved by this time next week, the day before the federal government may officially run out of money to pay all its bills.

"We may be here as we tick down to midnight," the official said. Treasury Secretary Tim Geithner has said August 2 the federal government runs out of funds, with incoming revenues far less than outgoing bills.

Democrats close to the negotiating process say there are several solutions to the dilemma, though all would require House Speaker John Boehner, R-Ohio, to stand up to conservative Republicans and be willing to compromise.

They cite the deficit reduction proposal being put forward by Senate Majority Leader Harry Reid, R-Nev., as an example of the difficulties of dealing with the House GOP. Reid's plan uses what Republicans call "gimmicks" to arrive at more than $2 trillion in deficit reduction -- such as counting the drawdowns of US troops in Iraq and Afghanistan as savings.

But the House GOP budget put forward by Rep. Paul Ryan R-Wisc., did the same thing, Democrats say.

Republicans say it's the White House that has changed its tune, suddenly asking for $400 billion more in taxes after the "Gang of Six" proposal was made, and more adamantly opposing a two-tier debt ceiling approach, with one vote now and another next year.

President Obama has canceled his appearances at two scheduled DNC fundraisers originally scheduled for today. One event will be re-scheduled, while Vice President Biden will appear at the other in his place.

-Jake Tapper

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