Friday, September 27, 2013

No Clear Path To Avoid Shutdown As House GOP Stands Firm

Wall Street Journal
September 27, 2013
Pg. 1

By Janet Hook and Kristina Peterson
Congress's rocky path to avoiding a government shutdown became even rougher Thursday, as Speaker John Boehner said the House wouldn't accept the spending plan likely to emerge from the Senate.
The Ohio Republican's announcement foreshadows a set of last-minute legislative volleys between the House and Senate to fund federal agencies ahead of a deadline Monday, the final day of the fiscal year.
The Senate is expected to pass a bill Friday that would fund the government for the first 1½ months of the new fiscal year. But Senate Democrats plan to restore money for the Affordable Care Act that House Republicans had stripped out, leaving the two chambers in conflict.
While the House and Senate struggled for agreement on a government-funding plan, Mr. Boehner was wrestling with the more daunting task of persuading members of his own party to support an increase in the federal debt ceiling.
Some of the most conservative House members were wary of the Republican leadership's plan to pass a one-year extension of government borrowing authority, even though it would be linked to a yearlong delay of the health law and other prized GOP policy goals. They expressed concern that the bill wouldn't cut spending enough and questioned the strategy of moving forward in the midst of a separate budget fight.
President Barack Obama repeated Thursday that he won't negotiate on the debt ceiling and won't sign any bill that defunds or delays the health-care law. He lashed out at Republicans for what he said were moves endangering the full faith and credit of the country. "You don't mess with that," he said in a speech in Largo, Md.
The Congressional Budget Office has estimated that if the debt ceiling isn't raised, the government will be unable to pay all its obligations sometime in late October.
Investors appear to be eyeing the possibility that the issue won't be resolved, judging by the sixfold increase in the past week—to its highest level since 2011—of the annual cost of derivatives some investors use to hedge against the risk the U.S. will default on its debt.
Rep. Tom Cole (R., Okla.), said House GOP leaders were still working to line up support for their debt-ceiling plan. "We've got an awful lot of support, but clearly at this point we don't have a final product that's attracting the number that we need," said Mr. Cole.
The fractiousness, jockeying and brinkmanship that spread across the Capitol rattled lawmakers and upended predictions about when and how the House and Senate would avoid two impending fiscal calamities.
Tensions were high on the Senate floor as Senate Majority Leader Harry Reid (D., Nev.) exploded in anger when he was blocked from holding the vote Thursday by an objection from Sen. Mike Lee (R., Utah), a leading opponent of the health-care law.
The Republicans' delaying tactics were "as obvious to me as it is to a kindergarten student," Mr. Reid said.
Sen. Bob Corker (R., Tenn.), accused Mr. Lee and Sen. Ted Cruz (R., Texas) of grandstanding in refusing to allow quicker action on the bill.
"The reason that we're putting this off is because they would like for people around the country that they have notified to be able to watch,'' said Mr. Corker, in an unusually personal public squabble with a fellow Republican.
Mr. Lee said the debate was too important to cut short. "The American people are paying attention to this," he said.
House lawmakers are prepared to be in session this weekend to take up the bill once it returns from the Senate. Talk that they might accept the Senate bill, which is sure to include money for the health law, and send it to President Obama for his signature dissipated on Thursday when Mr. Boehner said flatly, "I do not see that happening."
Even so, Mr. Boehner said he didn't expect a government shutdown. Many GOP officials are anxious to avoid one, because they fear their party would bear the blame. Republicans were widely seen as responsible for the shutdowns in 1995-1996 that arose from budget fights between Congress and then-President Bill Clinton.
Rep. Mo Brooks (R., Ala.) accused Democrats of gunning for a shutdown for political gain. "They crave a government shutdown, because they believe it would give them a campaign advantage in 2014," he said.
House Republicans are considering a range of options for amending the Senate bill to make it more palatable to conservatives, which would force the Senate to consider the bill again before the Monday midnight deadline.
Adding a one-year delay in the health-care law's individual mandate is an option that House GOP lawmakers are considering, as is a repeal of the law's tax on medical devices, senior Republican aides said.
House Republican leaders have been telling conservatives that efforts to limit the reach of the health-care law would be a central element of the battle over raising the debt limit.
The draft debt-limit bill being circulated included a range of GOP policy proposals. In addition to delaying the health-care law, it included instructions for overhauling the tax code, blocking environmental regulations and clearing the way for building the Keystone XL pipeline.
National Republican Congressional Committee Chairman Greg Walden (R., Ore.) said the policies are intended to stimulate the economy, which in turn would reduce the deficit. He said they also were designed to broaden the GOP message beyond its traditional antispending, small-government focus.
"It's not just about cutting spending; it's not just about cutting government," he said. "We have to grow the economy. Our message hasn't resonated as positively as we would want."
Democrats derided the legislation as a political gesture. "The House is attaching the Republican Party platform to the debt ceiling," said Sen. Charles Schumer (D., N.Y.).
Even with its broad reach, the draft bill didn't include any major deficit-reduction initiatives, such as structural reforms to Medicare and Medicaid.
Conservative critics said it represented a retreat from Mr. Boehner's past promises to support increases in the debt limit only if they are matched by spending cuts of equal value, with the goal of balancing the budget in 10 years.
"I don't know if this gets us down that road," said Rep. Mick Mulvaney (R., S.C.). "Are we still dollar-for-dollar in terms of reduction of the deficit?"
--Siobhan Hughes contributed to this article.

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