WHITE HOUSE — President Obama has now signed into law the agreement that temporarily extends the U.S. borrowing limit and ends the partial U.S. government shutdown after 16 days. Obama said it will begin to lift a "cloud of uncertainty" hanging over the U.S. economy, which faced a threat of default.
Obama spoke after the Senate approved the legislation in a strong bipartisan 81 to 18 vote, but before the House of Representatives was due to vote.
"We will begin reopening our government immediately and we will begin to lift this cloud of uncertainty and unease from our businesses and from the American people," said President Obama.
After the president's signature, the $16.7 trillion borrowing limit is extended through February 7, past the Thanksgiving and Christmas holidays so important for business profits.
The federal government, closed since October 1 when conservative Tea Party lawmakers linked funding to their demands to de-fund or significantly alter Obama's new health care law, would reopen through Jan 15.
The bill also sets the stage for new deficit reduction negotiations, similar to a so-called super committee created after a budget battle in 2011.
Obama said the nation's leaders have a lot of work ahead to earn back the trust of the American people, and said he is ready to work with lawmakers from both parties to help get the U.S. fiscal house in order for the long term.
"I have never believed that Democrats have a monopoly on good ideas and despite the differences over the issue of shutting down our government I am convinced that Democrats and Republicans can work together to make progress for America," said Obama.
The bipartisan agreement was crafted by Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell.
In the House of Representatives, Republican Speaker John Boehner's failed attempts to deal effectively with opposition from Tea Party members raised new questions about his leadership.
Boehner said Republicans would not give up on their fight to defund what he called the "train wreck" of Obamacare, the president's signature health care law.
Tea Party Republican Ted Cruz spoke on the floor of the Senate.
"Unfortunately today the U.S. Senate is saying you don't have a vote in Washington. You don't have a voice in Washington. This is a terrible deal," said Cruz.
Senate and House Republican leaders vowed to resist changes to across-the-board budget cuts known as the "sequester" that took effect earlier this year.
Spokesman Jay Carney said Obama will insist on a balanced approach in coming budget negotiations, and hopes they will be marked by a willingness to compromise.
"Perhaps we can reach a broader budget agreement that will settle some of these disputes in a way where nobody gets everything he or she wants, but the American people win because there is increased certainty," said Carney.
In his remarks, President Obama listed key priorities he said could be accomplished before the end of the year, including immigration reform, if leaders in Washington come together and put the last three weeks behind them.
"That is what I believe the American people are looking for. Not a focus on politics, not a focus on elections but a focus on the concrete steps that can improve their lives."
With the debt limit increase lasting only to February, and government funding to January, analysts warn that lawmakers could plunge Washington into a new crisis early next year.
As he left the White House briefing room late Wednesday, Obama was asked if he thinks the political battle over the debt limit could happen again in three months. He turned and replied with one word: "No."
Polls show Republicans, and Tea Party conservatives in particular, have taken significant hits in public opinion as a result of the government shutdown and the effort to link funding with Obamacare.
Analysts say this could have major implications for the 2014 mid-term congressional elections, and for the next national and presidential election in 2016.