The White House gave congressional leaders more time to come up with a deficit reduction plan that would prevent a government default to happen in less than two weeks. President Barack Obama said that he is open for a short-term increase in the debt limit if the leaders can agree on a plan before August 2. Debt Limit Deal

President Obama hopes that the Republicans and Democrats can achieve a comprehensive agreement with regards to the debt ceiling and deficit reductions. He wants to have the largest deal possible. He likes the plan proposed by the bipartisan group of senators called the Gang of Six. Their proposal would shrink the deficit by at least $3.7 trillion in a period of ten years.

If both Democrats and Republicans agree on a plan, President Obama will approve it. The Treasury Department said that Congress must be able to increase the debt limit before August 2 or the government would run out of funds. Legislators said that they would not vote for any increase in the debt cap if the plan doesn’t include any decrease in the deficit.

President Obama that he prefers a deal that’s close to $3.5 trillion. He recently met with Democratic congressional leaders as well as two top Republicans for separate meetings in the White House. The meetings ended with no progress to the negotiations.