Senate Cancels Fourth of July Recess to Tackle Debt Crisis

The U.S, Senate will scrap its cherished weeklong break for the July 4 Independence Day holiday in a bid to break a deadlock on a debt-cutting deal, the chamber's leader announced Thursday.

"We have work to do. We'll be in session," Democratic Senate Majority Leader Harry Reid said a day after President Barack Obama pushed lawmakers to stay in Washington absent substantial progress in negotiations.

The U.S. Treasury Department has said that the cash-strapped government will hit its congressionally set debt limit on Aug. 2 and warned that failing to raise it will send shockwaves through the fragile economy.

"The obstacle is too steep, and the time too short, to waste even a moment," said Reid. "There's still so much to do to put Americans back to work, to cut our deficit, and get our economy back to work."

His comments came amid seemingly dwindling odds that negotiations between Obama and his Republican foes would reach a breakthrough deal to rein in the runaway U.S. deficit in the weeks remaining.

Republicans have demanded spending cuts at least equal to the amount of the increase in Washington's ability to borrow while flatly refusing to raise taxes.

Obama and his Democratic allies have broadly agreed on spending cuts but insisted on the need for tax increases on the richest Americans.

Copyright Agence France-Presse, 2011

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