News / USA

US Lawmakers Begin Last-Ditch Effort on Debt Ceiling

Another Day Passes With No US Budget Deali
X
October 16, 2013
Democratic and Republican leaders in the U.S. Senate have resumed debate on a deal aimed at ending the government shutdown and increasing the government's borrowing authority ahead of Thursday's critical deadline, when the United States would default on some of its debts. Political and economic leaders are warning the ongoing impasse could have a negative impact on the domestic and global economies. Richard Green reports from Washington.

Related video by Richard Green

TEXT SIZE - +
Reuters
The U.S. Senate prepared for a last ditch effort Wednesday to avoid a historic lapse in the government's borrowing authority, a breach that President Barack Obama has said could lead to default and deliver a damaging blow to the global economy.

After a day of stop-and-go negotiations, the top Democrat and Republican in the U.S. Senate were said to be close to agreeing on a proposal to raise the debt limit - and reopen the partially shuttered government - for consideration by the full Senate on Wednesday. The measure's fate remained uncertain in the fractured Republican-controlled House of Representatives, which failed twice Tuesday to produce its own plan.

FILE - U.S. Representative Chris Van Hollen (D-MD)FILE - U.S. Representative Chris Van Hollen (D-MD)
x
FILE - U.S. Representative Chris Van Hollen (D-MD)
FILE - U.S. Representative Chris Van Hollen (D-MD)
The Senate was scheduled to meet at noon (1600 GMT) on Wednesday, and the House at 10:00 a.m. (1400 GMT). With borrowing authority set to run out on Thursday, Senate Majority Leader Harry Reid and Republican leader Senator Mitch McConnell "are very close" to an agreement, Representative Chris Van Hollen, a top House Democrat, told MSNBC late Tuesday night. "This is now back on track," Democratic Senator Heidi Heitkamp told CNN late on Tuesday, after a day of chaotic developments that frayed the nerves of many members of Congress and global financial markets.

McConnell and Reid resumed stalled talks after a rollercoaster day that saw two separate legislative efforts in the House buried after it became apparent too many Republicans were belling against their leaders' plans. Following weeks of bitter fighting among Democrats and Republicans, the layoff of hundreds of thousands of federal workers and turmoil for stock markets, the deal under discussion- if eventually enacted - would basically give President Barack Obama what he has demanded for months: A straight-forward debt limit hike and government funding bill.

Major US Payments Due

  • Oct. 23 - Social Security benefits $12 billion
  • Oct. 30 - Medicaid payments to providers $2 billion
  • Oct. 31 - Interest payment on public debt $6 billion
  • Nov. 1 - Medicare payment to providers and  plans $18 billion                
  • Social Security benefits $25 billion
  • Military pay, retirement and veteran benefits $12 billion
  • Supplemental Security income benefits $3 billion
  • Nov. 14 - Social Security benefits $12 billion
  • Nov. 15 - Interest payment on debt $29 billion
The deal would extend U.S. borrowing authority until Feb. 7, although the Treasury Department would have tools to temporarily extend its borrowing capacity beyond that date if Congress failed to act early next year. With the final details not yet nailed down, as it stood Tuesday night, the agreement envisioned funding government agencies until Jan. 15, ending a partial government shutdown that began with the new fiscal year on Oct. 1.

Asian stock markets were listless in early trading on Wednesday as they waited to see if Washington was closing in ona deal to resolve the debt crisis. Stocks showed little chang eand remained near a five-month peak.

Senate hurdles

Senate aides said the two leaders are looking at two possible ways of speeding the legislation through the chamber, which often can bog down for days with procedural hurdles.

Senator Dick Durbin, the second-ranking Senate Democrat, told reporters: "In order to move this quickly tomorrow or as soon thereafter as possible, we need cooperation of members. If they want to drag their feet, use every objection they can, this could take a few days."

Senator Ted Cruz is pursued by reporters upon his return to Capitol Hill in Washington, Oct. 11, 2013.Senator Ted Cruz is pursued by reporters upon his return to Capitol Hill in Washington, Oct. 11, 2013.
x
Senator Ted Cruz is pursued by reporters upon his return to Capitol Hill in Washington, Oct. 11, 2013.
Senator Ted Cruz is pursued by reporters upon his return to Capitol Hill in Washington, Oct. 11, 2013.
Under one scenario, all 100 senators would agree to let Democrats schedule quick votes to pass the bill. That would mean that Tea Party firebrands, such as Republican Senator Ted Cruz, would give up their rights to delay a vote. Cruz has not publicly announced his intentions but some Senate aides think that the Texas freshman with presidential aspirations has been sending positive signals in recent days. Cruz and fellow Tea Party activists late last month delayed passage of a government funding bill as they demanded major changes to Obama's landmark healthcare law. The deadlock led to federal agency shutdowns as Obama and his fellow Democrats stood firm against changing the law.

The other scenario would have the House send a formal "message" to the Senate to pave the way for quick Senate action, according to a Senate aide who asked not to be identified. Again, it was not clear whether House Republicans would go along with that option.

Boehner’s tough decision

House Speaker John Boehner, R-Ohio, walks away from the microphone during a news conference after a House GOP meeting, Capitol Hill, Washington, Oct. 15, 2013.House Speaker John Boehner, R-Ohio, walks away from the microphone during a news conference after a House GOP meeting, Capitol Hill, Washington, Oct. 15, 2013.
x
House Speaker John Boehner, R-Ohio, walks away from the microphone during a news conference after a House GOP meeting, Capitol Hill, Washington, Oct. 15, 2013.
House Speaker John Boehner, R-Ohio, walks away from the microphone during a news conference after a House GOP meeting, Capitol Hill, Washington, Oct. 15, 2013.
Assuming the Senate succeeds, House Speaker John Boehner will have to decide whether to allow passage of a bill that many of his fellow Republicans might oppose, a decision that could impact the top Republican's political future.

Uncertainty over Washington's ability to avert a default led Fitch Ratings to warn it could cut the sovereign credit rating of the United States from AAA, citing the political brinkmanship over raising the federal debt ceiling.

House Republicans twice tried to come up with a new compromise but failed to satisfy Obama, Senate Democrats or Tea Party conservatives who are determined to win changes to the president's signature health care law before they will agree to concessions on the budget. The first House Republican attempt was shot down in a closed-door meeting that had begun with members singing the hymn "Amazing Grace."

"The second plan was scuttled hours before it was expected to hit the House floor for a vote after the influential Heritage Action for America, a conservative group, urged a "no" vote because it did not do enough to stop Obama's healthcare law. If Congress fails to reach a deal by Thursday, checks would likely go out on time for a short while for everyone from bond holders to workers who are owed unemployment benefits. But analysts warn that a default on government obligations could quickly follow, potentially causing the U.S. financial sector to freeze up and threatening the global economy.

The U.S. Treasury Department seized on Fitch's downgrade threat to press Congress. "The announcement reflects the urgency with which Congress should act to remove the threat of default hanging over the economy," a Treasury spokesperson said. After the Fitch announcement, S&P 500 futures fell9.6 points while Dow Jones industrial average futures sank 60 points and Nasdaq 100 futures fell 7.5 points.

Numerous polls show Republicans have taken a hit in public opinion since the standoff began and the government partially closed. A Washington Post/ABC News poll released on Monday found that 74 percent of Americans disapprove of the way congressional Republicans have handled the standoff, compared with a 53 percent disapproval rating for Obama. Another survey released by Gallup on Tuesday showed American confidence in the U.S. economy fell another five points last week as the government shutdown continued. The crisis is the latest in a series of budget battles in recent years that have hurt consumer confidence and weighed on the economy.

A Monday estimate by the Peter G. Peterson Foundation, a think tank, said the uncertainty caused by the frequent fiscal showdowns had boosted the unemployment rate by 0.6 of a percentage point, or the equivalent of 900,000 jobs since late 2009.

  • Protesters pile barricades in front of the White House in Washington, Oct. 13, 2013.
  • Police scuffle with protesters taking part in the "Million Vet March on the Memorials" that drew hundreds of demonstators in front of the White House in Washington, Oct. 13, 2013.
  • A man carries an "Impeach Obama" sign while protesting outside the White House in Washington, Oct. 13, 2013.
  • A protester speaks to people gathered at a rally at the World War II Memorial in Washington, Oct. 13, 2013.
  • Senator Ted Cruz, R-Texas, speaks at a rally at the World War II Memorial in Washington, Oct. 13, 2013.
  • Kaylee, Sherry and Michael Cantrell pose for a photo with a sign and removed barricades at the World War II Memorial in Washington, Oct. 13, 2013.
  • People rally at the World War II Memorial in Washington, Oct. 13, 2013.
  • Protesters rally at the National U.S. World War II Memorial in Washington, Oct. 13, 2013.

You May Like

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

Turkish Law Gives Spy Agency Controversial Powers

Parliament approves legislation to bolster powers of intelligence service, which government claims is necessary to modernize and deal with new threats Turkey faces More

Video Face of American Farmer Changing

Average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population More

This forum has been closed.
Comment Sorting
Comments
     
by: Ramnarayan from: Florida, USA
October 16, 2013 6:28 AM
As a cancer researcher, I see that lot of out Govt. sites are not functioning. This means valuable discoveries to benefit people are in hold. Similarly, there are many other reasons for a pause in our ability to help our needy citizens. I urge the Congress to put aside the bickering and think about the people and their sufferings.

The Tea party should pause to think the consequences of their action. Are you for the people who elected you? In that case, why don't you show some maturity? Take your fights to the next election and let the people decide. It is shameful the way our politicians are behaving and treat the tax payers who pay for their salary with derision. At this rate, US will become a non player in the world. Is this the kind of legacy the Tea party is striving for? Watch out, you will get what you wish for. Grow up before you become irrelevant.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Face of American Farmer is Changingi
X
Mike Osborne
April 18, 2014
The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid