$3 Trillion Debt Deal In Play; Democrats 'Up In Arms' Over Possible Cuts

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3:48 p.m. Bloomberg also reports that the Gang of Six will have little impact on the final package after they were "given a deadline to offer specific proposals yesterday and didn’t produce any."

3:33 p.m. On Twitter, White House communications director Dan Pfeiffer pushed back against reports that the deal doesn't include new sources of tax revenue. "Anyone reporting a $3 trillion deal without revenues is incorrect," tweeted Pfeiffer. "POTUS believes we need a balanced approach that includes revenues."

3:29 p.m. Maryland Sen. Barbara Mikulski tells Roll Call Senate reporter Steven Dennis that Senate Democrats were "volcanic" when they first heard the details of the potential compromise at their caucus lunch earlier today with White House Budget Director Jack Lew.

3:14 p.m. The Washington Post notes that while leaders are in "deep negotiations" there's still work to be done on the deal. "According to one account, the issue of whether Bush-era tax cuts for wealthy Americans will be allowed to expire remains unresolved, as is the question of how much revenue should be raised through tax reform." According to congressional aides, the White House revealed the substance of the new round of negotiations to congressional leaders late Wednesday, with one Administration official describing the deal as "to the right of the Gang of Six".

3:00 p.m. Politico reports that some Democrats are "fearful that White House chief of staff Bill Daley is too willing to give ground to Boehner (R-Ohio) and cut them out of the process." Chris Van Hollen, the top Democrat on the Budget committee, said that while the reports about negotiations on a new large-scale deal "are real," he wasn't aware that anything was imminent. Meanwhile, one unnamed source said President Obama was "close to a deal" with House Republicans, while "other officials familiar with the talks said that assessment was overstating it." According to sources, Vice President Joe Biden made calls to congressional Democrats, telling them that "there was movement toward a large deal but that no agreements had been struck." In addition, "top administration officials were also fanned out across the Hill" to meet with congressional leaders.

2:51 p.m. Following what Brian Beutler describes as a "feisty" meeting with White House budget director Jack Lew, Senate Majority Leader Harry Reid told reporters on Capitol Hill that a deal "can't be all cuts" and that Obama has to get revenue increases into the deal. Here's his full statement.

"I only know what you know about the agreement -- the potential agreement. I've been told, a call came in from the White House during this meeting that there's no agreement, they're working toward an agreement. What I have to say is this: The President always talked about balance. That there had to be some fairness in this. That this can't be all cuts. There has to be a balance. There has to be some revenue in the cuts. My caucus agrees with that. I hope the President sticks with that. I'm confident he will."

2:31 p.m. The Huffington Post's Sam Stein reports that the "fail safe" debt plan put together by Harry Reid and Mitch McConnell is "close to being put on political life support" as lawmakers have begun to "coalesce" behind the new, larger deal.

2:21 p.m. Time's Jay Newton-Small writes that a deal is "close" but not imminent, and offers more details on the plan, which apparently also features a "sweeping" overhaul to the tax code. According to Small, "$3.5 trillion would be slashed from the budget over the next 10 years, including cuts to entitlement benefits... no revenue increases would be included ...and George W. Bush’s middle class tax cuts would not be decoupled from higher income cuts, as called for in the earlier 'grand bargain' worked out by Obama and Boehner. Instead, all revenues would be handled in a second bill, a sweeping overhaul of the U.S. tax code, to be passed before the end of the year."

2:12 p.m. Beutler says part of the anger from Democrats stems from the fact they had been given little "sense of what's in the still-forming plan -- vis a vis both spending and revenue" before the details began to drip out this afternoon.

2:09 p.m. "The mere fact the deal is under discussion already has Democrats up in arms," notes Friedman.

1:52 p.m. Talking Points Memo's Brian Beutler hears from a Congressional aide briefed on the status of the negotiations that the two sides are talking about "large, set-in-stone spending cuts but only the possibility of future revenue increases." "All cuts," said the aide. "Maybe revenues some time in the future." Meanwhile, two White House aides tell Beutler that the president "has been emphatic with Democratic negotiators that his preference is to negotiate a big deal with Boehner and squeeze it through Congress," rather than trying to form a consensus plan with Congressional Democrats.

1:44 p.m. National Journal's Dan Friedman adds some details about what kind of deal may be the closest at the moment, citing Congressional aides: "The White House and House Republican leaders are discussing a large deal to raise the debt ceiling that would include about $3 trillion in deficit cuts over 10 years." He adds that the scope of spending cuts will "enrage many Democrats in Congress, endangering its prospects in the Senate in particular. The mere fact the deal is under discussion already has Democrats up in arms."

1:37 p.m. White House spokesman Jay Carney joins Boehner in saying the two sides are "not close to a deal" according to National Journal's Rebecca Kaplan and Major Garrett. And Boehner is also denying the story. The Times article detailed the deal as such.

Update: The New York Times has published a story claiming that President Obama and House Speaker Boehner are close to a "major budget deal that would enact substantial spending cuts and seek future revenues through a tax overhaul"  according to congressional officers.

With the government staring at a potential default in less than two weeks, the officials said the administration on Wednesday night notified top members of Congress that a bargain with Mr. Boehner could be imminent. The Congressional leaders, whose help Mr. Obama would need to bring a compromise forward, were told that the new revenue tied to the looming agreement to increase the debt limit by Aug. 2 would be produced in 2012 through a tax code rewrite that would lower individual and corporate rates, close loopholes, end tax breaks and make other adjustments to produce revenue gains.

Meanwhile, Brad Daysmith, communications director for House Majority Leader Eric Cantor tweeted that Cantor "is unaware of any deal or that any deal is close." According to National Journal's sources in the House "Boehner is letting House Republicans know he'll unveil a debt-ceiling plan during their closed-door conference on Friday."

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