Obama tries to jump-start debt talks at White House

President Obama is convening the top two Senate leaders at the White House on Monday to restart debt negotiations after talks imploded last week over taxes and both sides struggle to reach agreement with a fast-approaching deadline.

It marked a crucial moment as both sides hoped to resolve the impasse to send a message to jittery financial markets well in advance of the Aug. 2 deadline. That goal now seems in doubt.

The nation risks unprecedented federal default in August if the nation fails to raise the $14.3-trillion debt limit and allow further borrowing.

After talks broke down last week, Republicans have amplified their objection to using tax revenues to bring down deficits. Democrats have pressed closing corporate loopholes and limiting income tax deductions on those earning beyond $500,000 annually. The GOP wants “trillions” in cuts on the spending side alone.

Obama was meeting with Sen. Harry Reid (D-Nev.), the majority leader, in the morning and was scheduled to meet with Sen. Mitch McConnell of Kentucky, the Republican leader, in the evening.

Talks led by Vice President Joe Biden dissolved last week after the top GOP negotiator in the House, Rep. Eric Cantor (R-Va.), the majority leader, dropped out, citing the impasse over the GOP’s refusal to consider tax revenues.