After late night phone calls and negotiations lasting well into the evening hours, President Obama announced late Sunday night that a deal was reached on the debt ceiling crisis with Congressional members of both parties. As the deadline of August 2nd loomed over the halls of Congress, leaders promised to present the compromise to their caucuses on Monday with the hope if getting it passed in the remaining 24 hour window. The New York Times Reports:

The tentative agreement calls for at least $2.4 trillion in spending cuts over 10 years, a new Congressional committee to recommend a deficit-reduction proposal by Thanksgiving, and a two-step increase in the debt ceiling.

The past few days have been a struggle. The timeline went as follows:

July 31 President Obama and Congressional leaders of both parties said they agreed on a framework for a budget deal that would cut trillions of dollars in federal spending over the next decade and clear the way for an increase in the government’s borrowing limit. Earlier, Republicans in the Senate used a filibuster to block a vote on Senator Reid’s debt limit proposal.
July 30 The Senate delays a vote on a Democratic proposal after news of new talks between Mr. Obama and Republican leaders. The deal being discussed would immediately raise the debt ceiling by about $1 trillion, accompanied by a similar range of spending cuts, and set up a bipartisan committee that would work to find deeper reductions in the deficit in exchange for a second debt limit increase that would extend through the 2012 elections. If the committee failed to act, $2 billion in across the board cuts would be imposed

July 29 House Republicans muscled through a revised debt limit plan without a single Democrat in support,voting 218 to 21o to improve a plan that would increase the federal debt ceiling in two stages, with the second installment of $1.6 trillion contingent on Congressional approval of a Constitutional amendment requiring a balanced federal budget. The Constitutional amendment provision was added to attract conservatives.

President Obama called on Congress to produce a fiscal plan that could be passed with votes from both parties, as Senate Democrats said they would move ahead with their own plan. House Republicans hardened their position, adding a provision to Mr. Boehner’s plan that would make the next round of spending cuts and debt relief contingent on Congressional approval of a balanced-budget amendment to the Constitution.

July 28 In a setback to Mr. Boehner, Republican leaders called of a House vote in a temporary increase in the debt ceiling when it became clear he lacked the votes to pass it. Mr. Boehner and his top lieutenants called it a night after more than five hours of furious arm-twisting of freshman Republicans, many of whom emerged from the closed-door sessions appearing to be firmer in their opposition.

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USA Today is not convinced that the verdict is conclusive.

President Obama and congressional leaders have reached a debt ceiling deal, but the political argument over the federal debt is far from over.For one thing, Congress as a whole still has to vote on the agreement — and for another, the deal would create a congressional committee to tackle the age-old debate over federal debt and spending.

Research editor Anthony Gregory offers a reply in his recent work “A Ghastly Spectacle”:

The workings of Congress are nauseating in the extreme…Yet when all the smoke clears, what are we looking at here?…The debt ceiling will be raised. The incredible borrowing will continue.

It will be interesting to see what the public sentiment on the verdict will be. Stay tuned!