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US Facing New Financial Deadlines

  • VOA News

Dome of the United States Capitol, Capitol Hill, Washington, D.C., July 28, 2011 file photo.

Dome of the United States Capitol, Capitol Hill, Washington, D.C., July 28, 2011 file photo.

The U.S. is facing crucial new financial deadlines in the coming weeks, needing to fund the government for the year starting in October and then increase the country's borrowing limit.

The government said Monday that it will run out of borrowing authority in mid-October as it approaches its current $16.7 trillion debt ceiling. That would be about two weeks after Congress and the White House will have to agree on an annual spending plan for the fiscal year that begins October 1, although President Barack Obama and lawmakers could work toward a short-term agreement and push off final decisions until later in the year.

If no accord is reached on the twin issues, the government could partially shut down and later not have enough money to pay its bills.

Contentious political fights in Washington over taxes and spending have been a recurring theme during the four and a half years of Obama's presidency, essentially a debate over the size and role of the national government. The White House call for higher taxes on the wealthy has been adamantly opposed by Obama's Republican congressional opponents, who want steep spending cuts in domestic programs.

The two sides have often negotiated till the last possible moments before reaching agreements to solve immediate funding issues. But Obama and congressional leaders have been unable to reach agreement on broader economic reforms, especially on tax law changes, spending on government pensions for older Americans and health care for retired workers the poor.

The leader of the Republican majority in the House of Representatives, John Boehner, has called for a short-term spending agreement to keep the government running October 1, but he says any increase in the debt ceiling must be accompanied by further spending cuts to eventually trim the country's debt. Some Republicans have called for repealing Obama's signature health-care law, which takes full effect in October, to save money, but Obama and Democratic lawmakers are opposed.

White House spokesman Jay Carney said Monday that the president would negotiate with Congress over the 2014 spending plan, but not on raising the debt ceiling.

"Let me reiterate what our position is, and it is unequivocal: We will not negotiate with Republicans in Congress over Congress' responsibility to pay the bills that Congress has racked up. Period."
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