Senate, House nearing deal to fund gov't, avoid default
By Steven R. Hurst ,APWASHINGTON -- Leaders in the House of Representatives and Senate were negotiating separate but similar plans Tuesday to reopen the U.S. government and prevent a default on American debt that economists say could tip the global economy back into recession.
October 16, 2013, 12:11 am TWN
The Senate moved first, taking the country halfway toward solving a bitter fight between Republicans and President Barack Obama's Democrats over government spending. In the House of Representatives, Republican leaders began moving Tuesday toward a similar deal, apparently viewing a shift in tactics as inevitable. Many conservatives, however, still were standing fast against the plan that would fund the government through Jan. 15 and allow the Treasury to borrow money to pay U.S. bills until February.
But House officials told The Associated Press on Tuesday that Speaker John Boehner and other Republican leaders had outlined their own bill that also would keep the government running into the New Year and raise the debt limit to Feb. 7. The measure is separate from a deal emerging in the Senate.
With just two days left before the Treasury Department says it will run out of borrowing capacity, congressional aides predicted Democratic Senate Majority Leader Harry Reid and Republican leader Mitch McConnell could seal an agreement by midday, easing dual crises that have sapped confidence in the world's dominant economy and badly shaken support for Republicans. Both House and Senate Republican leaders scheduled private meetings with their rank-and-file Tuesday.
Obama telephoned McConnell on Monday to talk about the emerging deal, a McConnell aide said. Congressional leaders had been scheduled to meet with Obama at the White House on Monday, but the meeting was postponed to allow more time for negotiations.
The partial government shutdown, which has furloughed 350,000 federal workers, began on Oct. 1 after Congress failed to pass a bill to temporarily funding the government. Separately, if Congress doesn't approve a measure increasing the amount of money the government is allowed to borrow, the Obama administration says it will not be able to pay America's bills on time, risking a default that analysts say could prove catastrophic for the economy. Both legislative measures are normally routine.
With Republican poll numbers plummeting and Americans growing weary of a shutdown entering its third week, Senate Republicans in particular were eager to end the partial government shutdown — and avoid an even greater crisis if the government were to default later this month.
The U.S. stock market turned positive Monday on the bullish predictions about the outcome of the Senate negotiations. Stocks in Asia and Europe were tracking upward Tuesday.
The plan under consideration by Reid and McConnell is far from the assault on Obama's signature health care reform law that conservative tea-party Republicans originally demanded as a condition for a short-term funding bill to keep the government fully operational. It also lacks the budget cuts demanded by Republicans in exchange for increasing the government's $16.7 trillion borrowing limit.
Instead, it appeared likely to tighten income verification requirements for individuals who qualify for federal subsidies under the health care law and may repeal a $63 fee that companies must pay for each person they cover beginning in 2014.
Any legislation backed by both Reid and McConnell can be expected to sail through the Senate, though any individual senator could delay it.
It had been a different story in the Republican-controlled House of Representatives, where conservative backing is proving hard to find.
The House bill also would suspend an Obamacare-related tax on medical devices for two years, require income verification for subsidies to receive health insurance and eliminate health care subsidies for the president, vice president, his Cabinet and members of Congre