Democrats and Republicans were hoping to have the framework of a deficit reduction package in place Sunday to resolve the country’s debt ceiling crisis and provide relief to nervous foreign financial markets.

It didn’t happen.  Now both sides are hoping Monday will bring better news. 

Earlier on Sunday, there were reports that House Speaker John Boehner was still considering what President Obama had described as a grand bargain that calls for nearly $3 trillion in spending cuts and $800 billion in added tax revenues over the next ten years.  Negotiations on the bipartisan compromise reached an impasse Sunday afternoon when the two sides became deadlocked over whether there would be another vote next year to raise the debt limit.

Both sides then decided to develop their own alternatives.  Top Democrats from the House and Senate met with President Obama at the White House while House Speaker Boehner consulted with fellow Republican lawmakers.

Speaker Boehner’s plan calls for a short-term fix involving one trillion dollars in spending cuts and the raising of the debt ceiling by the same amount.  That would allow the government to pay its debts through January.  The second part of Boehner’s plan calls for the immediate formation of a 12-member Congressional commission which, between now and January, would come up with an additional three trillion dollars in spending cuts, including cuts to entitlements.

Boehner’s plan would also include tax reform to raise revenue.  The Speaker has told his fellow House Republicans that it is time to make “some sacrifices” to avert a debt crisis.

Senate Majority Leader Harry Reid has discussed with fellow Senate Democrats a plan that would raise the debt ceiling through the beginning of 2013.  The plan would cut $2.4 trillion in spending and include no new taxes.

The country’s debt ceiling must be raised by August 2 or the U.S. will default on its financial obligations for the first time in its history.  Treasury Secretary Timothy Geithner appeared Sunday on ABC's This Week, again warning that default is not an acceptable option.

Secretary Geithner said, “Default would be a tax on all Americans. It would cause irreparable damage to the standing of the American economy, it would be devastating to our credibility as a country.”