Leaders in the US House of Representatives and Senate were negotiating separate, but similar plans yesterday to reopen the US government and prevent a default on US debt that economists say could tip the global economy back into recession.
The Senate moved first, taking the country halfway toward solving a bitter fight between Republicans and US President Barack Obama’s Democrats over government spending.
In the House of Representatives, Republican leaders began moving yesterday toward a similar deal, apparently viewing a shift in tactics as inevitable. However, many conservatives still were standing fast against the plan that would fund the government through Jan. 15 and allow the US Department of the Treasury to borrow money to pay US bills until February.
House officials said yesterday 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 says it will run out of borrowing capacity, congressional aides predicted 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 yesterday.
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.
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 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 does not 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 the US’ bills on time, risking a default that analysts say could prove catastrophic for the economy. Both legislative measures are normally routine.
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 US$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 US$63 fee that companies must pay for each person they cover beginning next year.