Congress has left for the week without reauthorizing the Federal Aviation Administration's budget.

That means furloughs and on-going airport projects will be halted.

Specifically, the FAA says:
-- 4,000 FAA employees in 35 states, the District of Columbia, and Puerto Rico will be furloughed
-- air-traffic-control operations will NOT be affected, but engineers, scientists, analysts, office staff, etc. will be affected
-- it will not be able to collect taxes, according to the airlines.

"I'm very disappointed that Congress adjourned today without passing a clean extension of the FAA bill," Transportation Secretary Ray LaHood said in a statement. "Because of their inaction, states and airports won't be able to work on their construction projects, and too many people will have to go without a paycheck. This is no way to run the best aviation system in the world."

Earlier this week, NBC's Luke Russert explained why Congress was unable to pass an extension to keep the entire FAA open.

President Obama said the attacks today in Oslo, Norway are a reminder that the international community has a stake in cooperating to prevent acts of terror around the globe.

Alongside New Zealand Prime Minster John Key in the Oval Office, Mr. Obama said, "Our hearts go out" to the victims of the Norway attacks.

Norwegian authorities are investigating a possible link between an explosion near the country’s main government building and a shooting at an Oslo youth camp. At this hour, there are seven confirmed fatalities.

Obama said the U.S. still doesn't have all the facts about the attack, but explained: "We have to work cooperatively together both on intelligence and in terms of prevention of these kinds of horrible attacks."

And he pledged the U.S. would fully provide Norway efforts to investigate the tragedy.

Earlier, the president received an update on the attacks from John Brennan, his top counterterrorism adviser.

Prime Minister Key echoed the President's comments, saying "If it is an act of global terrorism, then I think what it shows is no country -- large or small -- is immune from that risk."

The two leaders were meeting in the Oval Office to discuss a range of bilateral economic and security issues.

Sen. Dianne Feinstein (D-CA) unloaded on the White House this morning for keeping Senate Democrats in the dark about the Obama-Boehner budget talks.

Feinstein told reporters that she lost her cool in a Senate Democrat meeting Thursday with OMB Director Jack Lew. She accused him of not giving straight answers.

"I don't lose my cool; I lost it yesterday," she said.

She said she's never seen frustration higher among rank and file Democrats -- that senators only know about the Obama-Boehner talks from what they're reading in the papers.

"I like to know what I'm doing, and I can't get any information and it's very frustrating, It’s very hard. It’s easy to pass something and then a year or so later 'oh my god' I didn't realize I did that."

"We need to know what the cuts are, how they happen," she said.

Feinstein threw her support behind the Reid-McConnell legislation with a mandate for the "Gang of Six" bipartisan budget work included.

On how President Obama has handled his relationship with the Senate, she said testily: "I know what he's trying to do, but he has to keep his team advised. Whether you like it or not, people have to feel they're part of it."

"I represent a huge state where huge numbers of people are dependent on this."

Feinstein insisted that Democrats will not vote for legislation that doesn't include revenues and a specific amount upfront.

"You have to know that revenues are going to be a part of it, in other words 'X' amount will be revenues, or there is no agreement."

She predicted that Obama and Boehner would have to unveil a plan this weekend given the short number of days until the Aug. 2 deadline.

As expected, the Senate this morning voted to table its consideration of HR 2560 -- the so-called "Cut, Cap, and Balance Act" -- by a 51-46 vote. 

It was a strictly party-line vote, with all "yes" coming from Democrats or Dem-leaning indies, and all "no" votes coming from Republicans.

After the vote, Senate Majority Leader Harry Reid announced that the Senate would not work this weekend, and that he and the Republican leader would attend the "Gang of Six" meeting later in the morning.

On the cusp of a deal… The substance that’s still unresolved: how you “trigger” entitlement and tax reform (or punish Congress for NOT doing it)… And what’s also unresolved: soothing the egos of the Democrats and Republicans who aren’t going to like the deal… Brooks vs. Krugman on the grand bargain… Senate to vote on “Cut, Cap, and Balance” at 10:00 am ET… Obama holds town hall at 11:00 am ET in College Park, MD to sell the grand bargain… Panetta and Joint Chiefs will certify that DADT is ready to be repealed… Staff changes at Huntsman HQ… Pawlenty’s new TV ad… And Rudy’s thinking about a presidential run and will decide by the end of summer.

*** On the cusp: The Obama White House and House Speaker John Boehner are now thisclose to reaching a “grand bargain” deal. That framework includes spending cuts, plus entitlement changes and increased tax revenues (as part of a tax overhaul) that would come later. But there are two big hurdles left: 1) on the substance, and 2) on soothing egos. On the substance, the most contentious matter is how you “trigger” the provisions to guarantee completing tax and entitlement reform. The Democrats have offered a trigger of letting the Bush tax cuts expire for those making $250,000 or more. Republicans, meanwhile, have countered that if those Bush tax cuts are hanging in the balance, they’d offer a trigger of their own to ensure Dem action: scaling back Obama’s health-care law and eliminating the mandate. Bottom line: If entitlement and tax reform is completed on time, then the Bush tax cuts and the health-care law don’t get touched. Also on the substance front, we’re hearing that there’s yet to be an agreement on the scope of the entitlement changes. And never mind the actual individual cuts on the discretionary side. Details, details. The K Street Army is gathering forces if this deal goes through because we haven't seen this much change in the way government spends and gathers money in a generation.  

*** On substance and egos: And that brings us to soothing egos. There would be two winners if this deal gets reached: President Obama and John Boehner. Obama gets his deal, avoids default, and advances his brand -- as the Washington Post's Fixers write -- of being able to bring people together when others have failed. Boehner gets his deal too, accomplishes something historic, and provides some stability for his House majority. But here’s the deal: No one else wins. Not Nancy Pelosi and the House Democrats who want to take back that chamber. Ditto Mitch McConnell and Senate Republicans. So the next couple of days are all about soothing egos and convincing folks that it’s either this deal or nothing. By the way, one way Republicans are selling this to their rank-and-file, unlike previous "grand bargains" (think 1982 or 1990 or 1995) is this one has cuts up front. The best Democratic sales pitch is the Bush tax cuts aspect.

*** Brooks vs. Krugman: As we sometimes see on Friday, David Brooks and Paul Krugman fundamentally disagree on the New York Times’ op-ed pages. Brooks sees the grand bargain as a winner. “Mostly you do it because you want to live in a country than can govern itself. Over the past few weeks, Washington has seemed dysfunctional… Yet through all this, serious people — Barack Obama, John Boehner, the members of the Gang of Six — have soldiered on. They’ve been responsible and brave.” Krugman, on the other hand, sees the cuts as austerity that will harm the global economy. “The disappearance of unemployment from elite policy discourse and its replacement by deficit panic has been truly remarkable. It’s not a response to public opinion.”

*** A Senate vote, a town hall, and a presidential op-ed: As Washington closes in a debt deal, there are a couple of moving parts today. First, the Senate votes on the “Cut, Cap, and Balance” measure around 10:00 am ET, and it isn’t expected to pass. At 11:00 am ET, Obama holds a town hall at the University of Maryland in College Park, MD, to sell the grand bargain to the American public. The president also pens an op-ed in USA Today: “Yes, we should make serious spending cuts. But we should also ask the wealthiest individuals and biggest corporations to pay their fair share through fundamental tax reform.” He goes on to write, “[R]ight now, we have the opportunity to do something big and meaningful. This debate shouldn't just be about avoiding the catastrophe of not paying our bills and defaulting on our debt. That's the least we should do. This debate offers the chance to put our economy on stronger footing, restore a sense of fairness in our country, and secure a better future for our children.”

*** Certifying that the military is ready to repeal DADT: At 2:45 pm ET, Obama meets with Defense Secretary Panetta and Joint Chiefs Chairman Mullen. As NBC’s Jim Miklaszewski and Courtney Kube reported, the Pentagon will announce today that Panetta and all of the Joint Chiefs have certified that the military is ready to repeal "Don't Ask Don't Tell." Each member of the Joint Chiefs had to submit a recommendation to Secretary Panetta, indicating that they are far enough in their training to repeal DADT, and that it will not have an impact on military readiness. The next step is for Obama to certify the repeal, which then begins a 60-day waiting period to implement the repeal -- before "Don't Ask Don't Tell" is officially a thing of the past.

*** Staff changes at Huntsman HQ: Turning to the 2012 race, probably the biggest news yesterday was that Huntsman’s campaign manager, Susie Wiles, quit and is being replaced by communications director Matt David. So why did Wiles leave? According to her interview with the Miami Herald, “It was just time.” More Wiles: "It was in my plans to resign at some point. I have a great life and a great situation. We launched this thing and it’s up and running. Our team is so good that we hired from within. I continue to have a role here. I intend to be friend and confidante of Huntsman." With David at the helm, the campaign is expecting a more aggressive message from Huntsman. As senior adviser John Weaver said in a statement about the staff changes: "Now the campaign is moving into Phase 2, which will be more aggressive from a messaging and tactical standpoint and Matt is prepared to take that on." Because Huntsman hasn't vaulted into the top tier, some of the internal machinations that have been whispered about for weeks haven't really leaked out into the open. But there have been no clear lines of authority for some time, apparently.

*** T-Paw’s new TV ad: In the run-up to the Ames Straw poll, Pawlenty is up with a new TV ad. “I’m the only candidate with a specific plan to fix [unemployment and the debt], not just talk about it,” Pawlenty says to the camera. “I’ll eliminate ObamaCare, fix the tax code … and actually cut spending.” Many candidates talk about tackling tough problems; I’ve actually done it.” Just asking: But what happens to this message if the Obama-Boehner plan is enacted? The ad is airing in Des Moines.

*** Rudy’s thinking and deciding (by the end of summer): On FOX last night, per NBC’s Morgan Parmet, Rudy Giuliani said he’s “thinking” about a presidential run, and that he’ll make a decision by the end of the summer (as he’s said before). “I’m not leaning, I'm thinking. I listen to a lot of people. I listen to their advice. Some think it's a good idea to run; some think it isn't… I don’t want to do this just to, you know, just to run. I want to do it only because I think I have the best chance of winning. If I think someone else has a better chance, I don’t want to spoil their chances. It's too important that we replace Obama.” On timing, Giuliani said, “You've got to decide by the end of summer. By the end of August, end of September. August, September. Something like that.”

*** Trump’s threat: Also on FOX yesterday, Donald Trump threatened to run as an independent. “I'm going to see who is going to be the Republican nominee, and I'm going to be looking at the economy… If the economy continues to do badly, and if the Republicans pick somebody that I think is the wrong person and isn't going to win, I would very seriously consider running as an independent. And the reason I have to do it that way is because as you know what I'm doing doesn't allow me to run sooner than May.”

*** On the 2012 trail: Pawlenty remains in Iowa, visiting Des Moines and Urbandale.

*** Friday's "The Daily Rundown" line-up: Sens. Claire McCaskill (D-MO) and Kay Bailey Hutchison (R-TX) on debt deal deliberations... Cook Report's Dave Wasserman and Rothenberg Report's Nathan Gonzales with a 2012 redistricting primer... And one of us (!!!) joins the Washington Post's Chris Cillizza and Democratic strategist Karen Finney to chew on the latest campaign trail news.

*** Gregory sits down on Lee: On his weekly “Press Pass,” NBC’s David Gregory sat down with Utah Senator Mike Lee (R) to talk about the latest on the debt ceiling fight and 2012

Countdown to Wisconsin recall general for GOP senators: 18 days
Countdown to Iowa GOP straw poll: 22 days
Countdown to Wisconsin recall general for Dem senators: 25 days
Countdown to NV-2 and NY-9 special elections: 53 days
Countdown to Election Day 2011: 109 days
Countdown to the Iowa caucuses: 199 days
* Note: When the IA caucuses take place depends on whether other states move up

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Per the Washington Post, “President Obama and House Speaker John A. Boehner rushed Thursday to strike agreement on a far-reaching plan to reduce the national debt but faced a revolt from Democrats furious that the accord appeared to include no immediate provision to raise taxes… More savings would be generated through an overhaul of the tax code that would lower personal and corporate income tax rates while eliminating or reducing an array of popular tax breaks, such as the deduction for home mortgage interest. But the talks envisioned no specific tax increases as part of legislation to lift the debt limit, and the tax rewrite would be postponed until next year.”

The New York Times on the negotiations over a “trigger” that would ensure work on entitlement reform and tax reform: “The White House wants a trigger that would raise taxes on the wealthy; Mr. Boehner wants the potential penalty for inaction to include repeal of the Obama health care law’s mandate that all individuals purchase health insurance after 2014.”

The Baltimore Sun previews Obama's town hall in Maryland today. “About 1,000 people are expected to attend the hourlong event beginning at 11 a.m. at College Park, which will take place as congressional leaders continue to search for an agreement that will cut the budget deficit by trillions of dollars, raise the debt ceiling by Aug. 2 and eke out the best possible political position for their parties for the 2012 election.”

In his National Journal column, Ron Brownstein writes how important demography and an aging population are in the debt debate. “Too many Democrats resist the need to restrain entitlements, and even more Republicans refuse to admit the need for more revenue. Yet only by moving on both fronts -- beginning in the debt-ceiling standoff still convulsing the capital -- can the nation go gray without falling dangerously into the red.”

There’s an AFL-CIO print ad hitting the Gang of Six:

Charlie Cook, looking at the recent NBC/WSJ poll, writes: “One potentially useful exercise is to sort the candidates into brackets. If you add up the Romney, Pawlenty, and Jon Huntsman votes in the July survey, it totals 34 percent, basically one out of three Republican primary voters. Add up the Bachmann, Perry, Paul, Cain, and Rick Santorum voters, the more conservative of the two brackets, and it’s 44 percent. Gingrich always goes his own way, so it’s hard to assign him and his 8 percent to either bracket. Fourteen percent of Republicans don’t express a favorite in this field.”

HUNTSMAN: The New York Times: “Jon M. Huntsman Jr.’s campaign manager has resigned less than a month after Mr. Huntsman began his bid for the Republican presidential nomination… The manager, Susie Wiles, who had helped Rick Scott, a Republican, get elected governor in Florida last November, will be replaced by Matt David, the campaign’s communications director, officials said.”

The Times adds that “Wiles reportedly clashed with [senior adviser John] Weaver over the last month as the campaign got under way, according to people familiar with the private interaction between the two.”

PAWLENTY: On the campaign trail yesterday, Pawlenty said, per NBC's Morgan Parmet: "We've learned some other things along the way since President Obama's been a candidate. You can't put somebody in the Oval Office who hasn't had executive experience leading a large enterprise and driving it to conclusion under difficult circumstances with a public component to it. He was a college professor. He was a community organizer. He was in the United States Senate long enough to have a cup of coffee before it got cold and then we put him in the oval office and made him the leader of our nation and wonder why it didn't work. We don't want to make that mistake again."

Meanwhile, “ABC Sports may slap presidential candidate Tim Pawlenty with a cease-and-desist letter for improperly using its footage in a political advertisement,” the Des Moines Register reports. “‘It’s a violation of our copyright and exclusive proprietary rights,’ said Louise Argianas, director of rights and clearances for ABC Sports. The struggling Pawlenty campaign launched ‘The American Comeback,’ a television commercial with a down-but-not-out theme, in Iowa on Wednesday. The 30-second spot uses TV footage from the so-called “Miracle on Ice,” the hockey game in which the U.S. team beat the supposedly invincible Soviet Union in the 1980 Winter Olympics.”

ROEMER: “Former Louisiana Gov. Charles “Buddy” Roemer kicked off his Republican presidential campaign Thursday in Hanover, N.H., where the state’s ‘Live Free or Die’ motto pairs well with his campaign slogan, ‘Free to Lead.’”

Senior defense officials tell NBC News that the Pentagon will announce tomorrow that both Defense Secretary Leon Panetta and all of the Joint Chiefs have certified that the military is ready to repeal "Don't Ask Don't Tell."

Each member of the Joint Chiefs had to submit a recommendation to Secretary Panetta, indicating that they are far enough in their training to repeal DADT, and that it will not have an impact on military readiness.

The next step is for President Obama to certify the repeal, which then begins a 60-day waiting period to implement the repeal -- before "Don't Ask Don't Tell" is officially a thing of the past.

White House officials today shot down reports that President Obama and House Speaker John Boehner are getting close to a “major budget deal” to raise the debt limit.
 
Moments before the daily press briefing, the New York Times ran the headline: “Boehner and Obama Nearing Budget Deal, Leaders told.” A few minutes later, White House Press Secretary Jay Carney addressed the issue head-on. “There is no deal.”

Carney added, “We are not close to a deal... The president is in discussions with all the leaders of Congress, as well as other members, and exploring the possibility of getting the biggest deal possible, which is a position he has held for a long time now."

The rumblings about a possible deal came as top White House officials were spotted on the Hill. The administration’s budget director, Jack Lew, was seen going into a Senate Democratic lunch and Rob Nabors, the White House's legislative affairs director, was spotted waiting outside of Boehner’s office. When Lew was asked if a deal was close he replied, “There are conversations going on at multiple levels... I’m not aware of a deal.”

According to multiple reports, the potential deal in discussion would be $3 trillion in deficit reduction –- which would include cuts to programs like Medicare and Social Security, as well as future revenue increases by reforming the tax code.

Senate Majority Leader Harry Reid told reporters he was not aware of an imminent deal. “The president always talked about balance that there had to be some fairness in this," he said. “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, and I'm confident he will"

Leaders on all sides seem to agree time is running out. According to Treasury Secretary Tim Geithner the nation will default on its loans for the first time in History unless the debt ceiling is raised by Aug. 2. Geithner has warned a default could be economically calamitous, because the country would be unable to its bills and the value of the U.S. dollar would almost certainly decline.

In an interview today on MSNBC's "Andrea Mitchell Reports," House Budget Committee Chairman Paul Ryan signaled some flexibility on what he called "constructive ideas" that are now being discussed in the debt debate -- and said it's his judgment that they will find a way to resolve the issue.

My own judgment, based upon all the various conversations that are occurring, are that we will find a way to deal with this issue," Ryan said. And I think there are constructive conversations that are occurring -- both sides of the rotunda, both sides of Pennsylvania Avenue. And I do believe at the end of the day cooler heads are going to prevail."

He added, "The Biden talks, I thought, were probably the most productive exercise of all these exercises that have been going on around here. That put actual cuts, well, that's a longer story but because of the insistence for tax increases. But I still believe that those talks were producing some results on spending cuts."

Asked why he and the Republican caucus wouldn't want to pocket the spending cuts the president has already offered -- and work out the details later -- he said:

"That's what I want to do. I want to grab the spending cuts we can... I think that's what we're going to do at the end of the day here... I think that's what we should do is grab the kind of spending cuts we can right now." 

He went on to say: "Spending cuts in the so-called Gang of Six plan are extremely vague. They're sort of a promise that Senate Democrats will pass spending cuts later where there are no details and specificity. I've seen that game played around here before. So I want to get spending cuts under control. The other thing is with the Gang of Six - it's saying we're going to lower tax rates, which there's becoming a bipartisan consensus to that -- which I'm really encouraged about -- but keep the loopholes and raise revenues. These are conflicting mandates. They don't add up."

Asked about the McConnell-Reid negotiations, Ryan said:

"Since we're in the middle of these conversations right now, I just don't think it's in our interest to sort of speculate what our fallback plan is going to be. No offense. I just don't think it's good to negotiate through the media, as we're trying to get significant spending cuts to deal with this issue. There are lots of different fallback plans that are being offered out there. I assume that there will be a fallback plan in place. What that's going to be or what we want to agree to, it's just not in our interest to say that right now. But I do believe that we will have cooler heads prevail and prevent a default from happening."

Here are a few thoughts on our government and politics as we head into the end game on debt talks…

1. John Boehner is in a lose-lose situation here. Either he rolls the very people who put the GOP in the majority –- and therefore put the gavel in his hands –- or he allows the global economy to tank, and have it be blamed on Republicans. Roll or be rolled, would be one way to look at it. 

Now he’s taking meetings with Nancy Pelosi, after golfing with President Obama, a known Democrat, and making behind-the-scenes "grand bargains" with same -- thereby arousing the suspicions of...

2. The True Believer caucus, which is once again about to drive the wagon train off the cliff. They exist on both sides of the aisle, and their influence waxes and wanes with the times. As we know, this year’s GOP version is particularly suspicious of anyone and everyone -- including fellow Republicans -- who want anything less than a complete reordering of the governing paradigm. The resulting myopia often exaggerates the strength of one’s political position and leads to political debacles.

3. The principals in this drama are playing to two distinctly different political audiences, and therefore have two different, sometimes conflicting motivations that are contributing to the impasse. The president wants to appeal to 2012 independent, persuadable voters. I know this is obvious, but witness the willingness to put entitlements on the table and enrage his own party’s True Believers. It’s a broad, national audience. He can ride the high horse of compromise, and, according to our poll, it’s a winning entry. And as in any negotiation between Congress and the White House, the president always has the option to “take it to the American people,” as he told House Majority Leader Eric Cantor. He appears in the briefing room and frames the debate, lays down the predicate. True Believers never get that. Their insularity means they spend all their time talking to each other and view anyone outside the group as an apostate.

Speaker Boehner, on the other hand, is playing to that very True Believer constituency. It’s not a nationwide electorate of millions; it's 240 Republicans in the House who voted to make him speaker -- most of whom in turn represent, broadly speaking, 700,000 mostly center-to-conservative voters. Boehner has much less latitude than does the president. His only option other than a hard line is to essentially defy his base. But while that is exactly how the president wants to be perceived heading into 2012, it’s a leap into the abyss for the speaker.
           
4. Finally, isn’t it ironic that those who cast themselves as the stoutest defenders of the Constitution and who promote the genius of the Founding Fathers are the same ones who can’t accept that there is a Senate controlled by duly elected members of the other party, not to mention a House minority that opposes them? The Founders understood the political imperative and expressly designed a Congress that takes it all into account. To say that the opposition should roll over because Americans spoke clearly in the last election doesn’t reckon for the fact that the Founders staggered elections for a purpose, and that voters have sent a Democrat to the White House and to the majority in the Senate in previous elections.

In 1993 appearance on "Meet the Press" during the debate over the budget deal Congress then was considering, the late Sen. Daniel Patrick Moynihan (D-NY) put the arguments about taxes and spending into perspective.

MR. RUSSERT: Is the energy tax a fight until death, or are you willing
to compromise a little bit with Senator Boren, modify if a bit--

SENATOR MOYNIHAN: Fight until death over taxes? Oh no. Women, country,
God, things like that. Taxes? No.

(Moynihan's response is at eight minutes into this video.)

It's that kind of perspective that has comforted the glass-half-full observers of the current showdown over the debt ceiling. Will political leaders truly fight to the death -- or in this case, fight to default -- over taxes and spending?

Well, the New York Times is reporting -- from congressional sources -- that President Obama and House Speaker John Boehner are closing in on a deal.

The Obama administration has informed Democratic Congressional leaders that President Obama and Speaker John A. Boehner were starting to close in on a major budget deal that would enact substantial spending cuts and seek future revenues through a tax overhaul, Congressional officials said Thursday...

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.

Officials knowledgeable about the conversations between the administration and Congressional leaders said the details of the potential package remained unknown but they presumed it would include cuts and adjustments in most federal programs, including Medicare.

But all sides have shot down the New York Times report. "While we are keeping the lines of communication open, there is no 'deal' and no progress to report," a Boehner spokesman tells NBC's Luke Russert. "We are still focused on the 'Cut, Cap, and Balance' bill that passed the House with bipartisan support, and hope the Senate will take it up as soon as possible."

And White House Communications Director Dan Pfeiffer tweets:

Wrong. POTUS pushing for biggest deal possible, but nothing new MT @nytimes: NYT NEWS ALERT: Obama and Boehner Close to Major Budget Deal

NBC's Chris Donovan contributed to this report.

NBC News has confirmed that Jon Huntsman campaign manager Susie Wiles has quit the campaign, and she's being replaced by top communications aide Matt David.

Huntsman senior adviser John Weaver says in an email:

"Susie has served the campaign well and was vital in getting it off the ground in such a short time-frame. In just under three months Gov. Huntsman has returned from China, launched a campaign and created a strong infrastructure in the 3 early primary states. He's built important relationships with donors, as well as political, policy, and grassroots leaders that other candidates have been courting for half a decade."

More from Weaver: "Now the campaign is moving into phase two which will be more aggressive from a messaging and tactical standpoint and Matt is prepared to take that on."

Just hours after the Washington Post editorial page reported that anti-tax activist Grover Norquist wouldn't consider letting the Bush tax cuts expire as breaking his tax pledge (“Not continuing a tax cut is not technically a tax increase"), Norquist said he opposes such a compromise in the current debt standoff.

"It wouldn't pass the laugh test to go to the American people and tell them you just allowed four trillion dollars in higher taxes by allowing the 2001, 2003 lower rates to lapse and tell people that's not a tax increase," he told MSNBC's Chris Jansing.
 
When Jansing pressed Norquist whether letting the Bush tax cuts expire would violate the pledge, he didn't directly answer the question -- but stressed that his organization would oppose the move.

"There are certain things you can do technically and not violate the pledge, but that the general public would clearly understand as a tax increase. So I can be clear: Americans for Tax Reform would oppose any effort to weaken, reduce, or not continue the 2001, 2003 Bush tax cuts.

Norquist added, "Clearly they need to continue, and not to continue them would be felt by the American people as a very dramatic tax increase. And the Republicans have made it clear that's off the table and we support that effort."

Bottom line: It's technically correct that letting the Bush tax cuts expire doesn't violate the pledge, which states that a member will "1) oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses; and 2) oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates."

But Norquist also said Americans would still see it as a tax increase, and that's why his group would oppose it.

NBC's Lauren Selsky and Dax Tejera contributed to this report.

The Republican National Committee yesterday filed its report with the Federal Election Commission, showing that it raised $6.8 million in the month of June.

The bad news for the RNC under Chairman Reince Priebus: That means its 2nd quarter haul (about $19 million) is less than what Michael Steele's RNC raked in the 2nd quarter of 2009 ($20.5 million). In addition, the Priebus-led RNC has brought in more than $37 million for the first half of the year, versus the Steele-led haul of $40 million-plus in the first half of 2009.

Also by comparison, the Democratic National Committee -- with President Obama's help -- raised nearly $60 million for the first half of 2011.

The good news for the RNC: It says it's reduced its spending (which was always the Steele administration's biggest problem); it's bringing back thick-walleted GOP donors; and it's lowering the debt it inherited from Steele. But that debt is still $17.5 million.

"We're happy with our fundraising," an RNC official tells First Read. "People are starting to come back to the party, which is a huge step in the right direction."

"We've cut staff and overheard by 30% from this time in 2009," the official adds. "We're making progress every month and feel good about where we are and where we are headed."

But Republican strategist Doug Heye, who served as Steele's top communications aide, makes this larger point about the money chase: "In a bad economy, in a post-Citizens United world, and without a [Republican] president, it's hard to raise money."

*** UPDATE *** Another RNC official calls to note that it's raised more money from major GOP donors in the first six months of 2011 than Steele did during his entire two years as chair. Moreover, the official explains that its lower costs and overhead is the most important takeaway from its financial reports. "You get judged by what you're putting in the bank."

From NBC’s Kelly O’Donnell and Libby Leist:
This morning on the Senate floor, Majority Leader Harry Reid publically vented his clear frustration with House Republicans over the ongoing debt ceiling negotiations. “Let me get this off my chest,” he said, calling it “untoward” that the House is not in session this weekend.

He warned Congress has "days, not weeks" to get this done.

He complained that the Senate is in a holding pattern, waiting for action from the House. “I think it is just untoward,” said Reid. “That's the kindest word I can say to the House of Representatives, out this weekend … what a bad picture that shows to the country.”

He continued, "… Time is of the essence. We are running out of time, procedurally things can't move very quickly through the Senate - under the best circumstances and when there are people who want to cause problems it takes a long time to get things done."

Reid also criticized Tea Party involvement in the negotiations, calling those lawmakers the “loudest, shrillest voices in the Republican Party.”

As for the “cut, cap and balance” bill which passed the House, Reid insisted it “doesn't have one chance in a million of passing the Senate"

Breaking down the three different tracks to a resolution on the debt ceiling… The grand bargain’s back… But can ANYTHING get through the House?... Is this the solution -- let the Bush tax cuts expire? (Grover Norquist says that won’t violate his tax pledge)… It takes 217 to make a thing go right: Magic number for passage in the House is 217, not 218… Bachmann’s rapid response on the migraines story… But Pawlenty goes there (and later walks it back, kind of)… Could Romney’s strength be a weakness?... And another national poll shows Romney in first, Bachmann in second.

*** The three different tracks: With the clock ticking until the Aug. 2 deadline, there are essentially three tracks to resolve the debt-ceiling standoff. One track is McConnell-Reid, the ongoing negotiations between the Senate Majority Leader and Senate Minority Leader to pass a “failsafe” debt ceiling increase without majorities of Congress having to approve it, and it's losing a lot of steam (right now). The second track is the talks between President Obama and House Republicans John Boehner and Eric Cantor, as they try to revive a “grand bargain” -- and it's a track that is a LOT more active than folks realize. And the third track is a second grand-bargain-style deal -- this one by the Gang of Six in the Senate. “Right now, there are multiple trains heading towards the station, and we have to decide,” White House Press Secretary Jay Carney said yesterday. “And some of them may continue up to the last moment, because we need to be sure that that failsafe option is there even as we pursue, aggressively, the possibility of doing something bigger.”  

*** The grand bargain’s back: Earlier this week, we wrote that the grand bargain appeared to be dead. But right now, it seems to be gaining more and more momentum. The Washington Post: “By Wednesday evening, as House Speaker John A. Boehner (R-Ohio) and Majority Leader Eric Cantor (R-Va.) huddled with Obama at the White House, aides in both parties said a grand bargain to slice $4 trillion out of the federal budget over the next decade was back on the table.” The New York Times adds, “Politically, the main question remained whether House Republicans would be willing to negotiate over any package that could be construed as raising taxes, and throughout the day there were signs of internal debate among party leaders.”

*** House Republicans sour on McConnell-Reid: So what happened to McConnell-Reid? Here’s one explanation we’ve heard: House Republicans have soured on McConnell’s legislative maneuver, which essentially cedes Congress’ authority on the debt and passes it to Obama. It really poisoned the well in the trust between House Republicans and Senate Republicans for now. If there’s one piece of good news out there, it’s that McConnell’s plan so upset Tea Party House members that they’re more open to a grand bargain than they’ve been before. That explains why Boehner and Cantor are together now meeting with the president, but without any other House or Senate leaders.

*** Can anything get through the House? But all of this emphasizes one VERY important point right now: There is currently no plan out there that could get through the House. And that’s raised chatter on Capitol Hill that the only way to convince enough House Republicans to support ANY track is for the Dow Jones to collapse, a la what happened with TARP in 2008. Of course, that possibility makes this Onion headline seem appropriate: “Congress Continues Debate Over Whether Or Not Nation Should Be Economically Ruined.” And yet, the lack of trust in what Wall Street says and what government says is what drove many of these Republicans to run for Congress in the first place. So that may explain why they are skeptical of all these dire warnings. The leaders of both parties are desperate to avoid this, but it may not be possible.

*** Is this the solution -- let the Bush tax cuts expire? Don’t miss this news, via the Washington Post editorial page: “With a handful of exceptions, every Republican member of Congress has signed a pledge against increasing taxes. Would allowing the Bush tax cuts to expire as scheduled in 2012 violate this vow? We posed this question to Grover Norquist, its author and enforcer, and his answer was both surprising and encouraging: No.” Wow.

*** It takes 217 to make a thing go right; it takes 217 to make it out of sight: With two vacancies right now, the magic number to pass legislation in the House is 217, not 218.

*** Bachmann’s rapid response: Turning to the 2012 race, Team Bachmann has handled the candidate’s migraine story about as well as they could. Yesterday, they released a letter from the doctor in the House of Representatives, who said that Bachmann’s migraines are under control and infrequent. “When you do have a migraine, you are able to control it well with as-needed sumatriptan and odansetron,” the doctor said. “It has not been necessary for you to take daily medications to manage this condition.” But there are two points to make here. One, Bachmann has no margin of error regarding any other story on her health; any moment on the campaign trail that appears to be health related will reignite this story in a second. Two, there are former Bachmann staffers out there -- the ones who anonymously leaked this story -- to hurt her candidacy. In fact, THAT's probably the campaign’s bigger concern right now…

*** Pawlenty goes there… : And a concern for rival GOP campaigns is that they don’t seem like they’re taking advantage of Bachmann’s health care. But Tim Pawlenty went there yesterday, saying in Iowa, per NBC’s Morgan Parmet: “I don't know enough about the facts of her particular case, and I would defer to the medical professionals and their judgment and knowledge about her particular condition. But as a general statement, all of the candidates are going to have to demonstrate they can do all of the job as president all of the time.” That, folks, was a subtle dig at Bachmann’s migraines.

*** … But he walks it back (kind of): Yet in an interview last night on FOX, Pawlenty walked back that statement, kind of. “It’s mostly a sideshow,” he said.  “I have never seen her have a medical condition or impairment that would seem to be a concern. What I said today, generically, applying to all candidates -- not her – is that anybody who is going to serve as president of the United States has to be able to do all of the job… That’s just common sense; it’s not a debatable proposition.” Contrast that with what Romney said yesterday (in which he suggested that it’s already a two-person race for the GOP nomination): "There's no question in my mind that Michele Bachmann's health is in no way an impediment to her being able to serve as president. She and I have differing views, I'm sure, on some issues. We'll campaign in various states and express our views, but her health should not be an issue in the campaign. I have no question about that in my mind."

*** Could Romney’s strength be a weakness? As we discovered in 2004, someone’s political strength -- John Kerry’s military service -- could be turned into a weakness in a presidential election. And as Bloomberg News reported yesterday, you don’t need a Swift Boat Veterans for Truth organization to uncover how Mitt Romney’s business experience could be turned into a weakness in this economy. “What Romney skips [on the campaign trail] is his experience in eliminating jobs. It's a facet of his career that presents a particular challenge for the Republican primary frontrunner: Tough business decisions don't necessarily translate into good politics.” More: “Employees who lost jobs at Bain-controlled companies more than a decade ago say they still hold Romney responsible. ‘I would not vote for him for anything,’ said Phyllis Detro, 68, who lost her job at a Bain-owned office paper products factory in Marion, Ind., closed in 1995. ‘I'd like to see the jobs that he's created. He has taken away jobs.’”

*** Another national poll show Romney in first, Bachmann in second: By the way, the Washington Post-ABC poll results on the GOP horserace are nearly identical to the numbers from our NBC/WSJ poll: “Romney tops the field at 30 percent to Bachmann’s 16 percent, with Paul at 11 percent. Perry is at 8 percent.”

*** On the 2012 trail: Pawlenty continues his RV tour through Iowa, stopping in Ames, Webster City, Fort Dodge, and Perry… Cain is in New Hampshire…

 *** Thursday’s “Daily Rundown” lineup: Sen. Chris Coons (D-DE) and Rep. Charlie Dent (R-PA) on the debt talks… The Washington Post’s Nia-Malika Henderson, The Grio’s Jeff Johnson and USA TODAY’s Jackie Kucinich on the latest 2012 news.

Countdown to Wisconsin recall general for GOP senators: 19 days
Countdown to Iowa GOP straw poll: 23 days
Countdown to Wisconsin recall general for Dem senators: 26 days
Countdown to NV-2 and NY-9 special elections: 54 days
Countdown to Election Day 2011: 110 days
Countdown to the Iowa caucuses: 200 days
* Note: When the IA caucuses take place depends on whether other states move up

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The Washington Post: “By Wednesday evening, as House Speaker John A. Boehner (R-Ohio) and Majority Leader Eric Cantor (R-Va.) huddled with Obama at the White House, aides in both parties said a grand bargain to slice $4 trillion out of the federal budget over the next decade was back on the table.”

The New York Times adds, “Politically, the main question remained whether House Republicans would be willing to negotiate over any package that could be construed as raising taxes, and throughout the day there were signs of internal debate among party leaders.”

Politico echoes that point: “[T]he House GOP showed no sign of relenting, having come off a tough, almost party line 234-190 victory Tuesday on the same debt-and-tax question.”

A new Quinnipiac poll has Obama’s approval rating in Ohio at 46%, but he leads Romney by four points in the Buckeye State, 45%-41% (though he’s below the magic 50%).

The Center for American Progress’ Faiz Shakir pens a Washington Post op-ed arguing that the White House should allow its nominees -- like Richard Cordray, who was tapped to head up the Consumer Financial Protection Bureau -- to speak. “The White House should take the muzzle off its nominees. Let them talk to the press over and over again to tout their accomplishments. Allow them to publicly defend their records, as they are best and uniquely qualified to do. By silencing a nominee, the administration gives its critics the opportunity to spout unfounded concerns about the nominee’s fitness to serve. The conversation quickly descends from one about the individual’s merit to meritless attacks on his or her character or qualifications.”

The Washington Post on the latest WaPo-ABC poll: “Mitt Romney leads the wide-open contest for the 2012 Republican presidential nomination. But a new Washington Post-ABC News poll underscores his vulnerabilities as a front-runner, as well as Sarah Palin’s lingering power to shake up the race if she decides to run.”

More: "Without Palin in the race, Romney tops the field at 30 percent to Bachmann’s 16 percent, with Paul at 11 percent. Perry is at 8 percent."

“Democratic Congressional Campaign Committee officials say they have exceeded internal benchmarks for 2012 recruitment, and today they will roll out a list of highlighted candidates running in a sample of the 41 open or Republican-held districts where a Democrat has filed or committed to run,” Roll Call writes.

BACHMANN: The Boston Globe’s Johnson: “You can ask a presidential candidate about his age (see: Ronald Reagan, John McCain). You can ask him about his physical health, especially if he suffered from cancer (see: Paul Tsongas). But when you ask about his mental fitness, it broaches exceedingly dangerous political ground, which helps explain Michelle Bachmann’s aggressive response this week to a report she suffers from debilitating migraine headaches.”

ROMNEY: The New York Times picks up on Romney’s play-it-safe strategy. That approach, it says, “has served Mr. Romney fairly well during the first seven months of the year. He has not had to accept ownership of positions being taken by Republicans in Congress. He has stuck to his message on the economy and job creation, even while navigating criticism about his health care record as governor of Massachusetts. But as the Republican presidential campaign intensifies, with Mrs. Bachmann capturing the imagination of conservative activists and Mr. Perry being forcefully recruited by Republican leaders to declare his candidacy, Mr. Romney’s determinedly low-key approach could be fraught with peril.”

While campaigning in Los Angeles today, Republican presidential hopeful Mitt Romney said he was "proud" of his economic record during his one term as Massachusetts governor.

"When I left, unemployment in Massachusetts was 4.7%. It's now substantially higher than that," Romney said. "I'm afraid that under the current governor we haven't seen job growth in Massachusetts."

Democrats have seized on the fact that Massachusetts ranked 47th in the nation in job creation during his four years as governor.

Standing in front of a mall development project that has been halted partly because of economic conditions in the state,  Romney pointed out that California has lost 500,000 jobs since President Obama took office.

"I'm not running against the governor Massachusetts; I'm running against the president of the United States," Romney said. "And he has not created jobs. He's lost jobs."

"[President Obama] didn't focus on the economy," Romney added. "He delegated the stimulus to Nancy Pelosi and Harry Reid, and they may have had less experience in the economy than he had."

Romney also defended his opponent Michele Bachmann from questions about if migraines would affect her potential presidency.

"There's no question in my mind that Michele Bachmann's health is in no way an impediment to her being able to serve as president," he said. "She and I have differing views, I'm sure, on some issues...but her health should not be an issue in the campaign."

Due to disagreements between the House and Senate, key programs inside the Federal Aviation Administration are slated to shut down by the end of Friday.

Aides from both sides tell NBC News that air-traffic controllers and safety inspectors will not be subject to the shutdown, and planes will fly and safety procedures will carry on -- because controllers and safety inspectors are considered essential employees.

Since September 2007, Congress has been unable to agree on a long-term FAA funding bill. Therefore, they have done a series of short-term extensions -- 20 in total. Right now, the House and Senate can't agree on the 21st short-term extension.

There are two particular disagreements. One is over labor rights. In February, the Senate passed an FAA extension bill that allowed for airline and railroad workers to unionize more easily. Under that legislation, a union could be set up if a simple majority of voters who were present approved of the union. Under the old rule, employees who didn't show up to the meeting were counted as "NO" votes on unionizing.

In April, the House passed a FAA extension bill that did away with this union provision. But Senate Democrats have said they won't pass a FAA extension bill that doesn't have the union provision.

A second disagreement is over rural airports. House Transportation Chairman Rep. John Mica (R-FL) wrote up another temporary FAA authorization bill that passed the House today, 243-117. But this extension wasn't clean: It included specific language that would strip funding away from some rural airports, including:
-- in Ely, Nevada (home state to Senate Majority Leader Harry Reid)
-- in Morgantown, West Virginia (home to Sen. Jay Rockefeller)
-- in Glendive, Montana (home to Senate Finance Chairman Max Baucus).

A GOP aide tells NBC News that the cuts would save about $16 million dollars.

Not surprisingly, Rockefeller, Reid, and Baucus saw Mica's move as trying to score personal political points and have said they will not agree to a bill that sacrifices small community airports.

What happens if the FAA shuts down?

The Transportation Department says:
-- 4,000 of the FAA's 32,000 workers will be furloughed on Saturday and that that number could rise.
-- airlines would no longer collect ticket taxes, which are used for a trust fund to pay some FAA employees.
-- some new construction projects at airports around the country will have to be put on hold

Where do we go from here?

It's unclear. A GOP aide says that a deal very well could be struck in the 11th hour. Dems are holding firm on the union provision as part of a long-term FAA funding bill and in the present time do not want to see community airports cut.

The GOP feels they have the high ground on the issue because they think Dem senators will look petty if they shutdown the FAA over three small airports in a short-term funding bill.

The physician in the House of Representatives, Brian Monahan, MD, has released a letter concerning Michele Bachmann's migraines.

Monahan states that Bachmann's migraines are under control and infrequent, adding that she does not take daily medication.

Dear Congresswoman Bachmann:

The enclosed summary regarding your experience of migraines is provided to you as per your request. You are in overall good general health.

You have a well established diagnosis of migraines with aura for which you have had extensive evaluation by both my office and a consulting neurologist. Your evaluation has entailed detailed lab work and brain scans all of which were normal. Your migraines occur infrequently and have known trigger factors of which you are aware and know how to avoid. When you do have a migraine, you are able to control it well with as-needed sumatriptan and odansetron. It has not been necessary for you to take daily medications to manage this condition. You have not needed medical attention from me regarding your migraines with the use of the above mentioned commonly used therapies.

Sincerely,
Brian P. Monahan, MD

Sen. Dick Durbin, the No. 2 Democrat in the Senate leadership. returned to the Capitol this afternoon and briefly described President Obama's meeting today with congressional leaders. 

He told reporters that Obama walked back what White House spokesman Jay Carney said earlier in the day about a potential willingness for a short-term budget deal.

Durbin said, "[Obama] made it clear he has not changed his position" -- which is a debt-ceiling increase that lasts through 2012. 

(Carney also clarified his statement: "The president does not support a short-term extension of the debt limit, period. The only exception to that is in the event that both sides reach a deal on a long-term extension of the debt limit plus significant deficit reduction, and we needed a very short-term extension (like a few days) to allow a bit of extra time for a bill to work its way through the legislative process.".)

Durbin also said the substance of the bipartisan Gang of Six plan will not be incorporated into the Reid-McConnell legislation. 

"We are now down to 12 days; its not practical," Durbin said, adding there is no legislative language and it's not scored by the Congressional Budget Office.

Durbin said that Senate Majority Leader Harry Reid is open to making a "reference" to the Gang of Six in the legislation.

Finally, Durbin pointed the finger at the House and said Senate Democrats are waiting on them. "We're hoping that Mr. Boehner will come up with his approach, whatever it is."

Reid spoke to reporters afterward, echoing Durbin: "I want to hear what the speaker has to say."

A bipartisan group of House members today unveiled a resolution to honor Gabe Zimmerman, the congressional staffer who was killed during the Arizona shooting that seriously wounded Rep. Gabby Giffords (D-AZ).

Both Zimmerman’s mother and brother, Ben, spoke.

Ben -- who took multiple moments to compose himself -- said this of his brother as the room went silent: "He was a committed, committed congressional staff member who approached his job with openness and kindness… What he taught me in that short time was that small acts of kindness make a tremendous difference."

If the House passes the resolution, it would rename one of the rooms in the Congressional Visitor Center after Zimmerman. The Republican-controlled House so far has shunned ceremonial resolutions, but this measure’s bipartisan support could help it find its way to the floor. It is co-sponsored by Reps. Debbie Wasserman Schultz (D-FL) and David Schweikert (R-AZ) -- along with other members of the Arizona delegation who are hoping to work it in as an amendment to the legislative branch’s appropriations bill.

Both Schweikert and Wasserman Schultz said that naming the room in honor of Zimmerman was also a way to honor all congressional staffers. "This distinction would recognize the devoted service of not only Gabe, but also of the thousands of staffers in the Capitol and around this country who work for and have worked for the people of the United States by working for the United States Congress," Wasserman Schultz said.

Zimmerman's mother added, "It's right to honor Gabe here at the Capitol, where Congress is charged with responding to the needs of those people that stood in that line at that grocery store and to all Americans by crafting our nation's laws."

And with the backdrop of the acrimony of the current debt ceiling talks, Gabe's brother left the podium with this thought: "I hope Gabe's memory will serve to honor those congressional staff workers. Let the negativity of politics roll off of them with grace and a smile, and instead focus their energy on service to their communities and compassion to their constituents."