October 9, 2013

Democrats try using debt bill to avoid default

Meanwhile, the stock markets start to lose confidence as the budget stalemate shows no signs of a solution

By Zachary A. Goldfarb
The Washington Post

(Continued from page 1)

The difficulty of achieving an agreement was underscored Monday when Senate Republicans said they might try to amend legislation – which the House passed unanimously over the weekend – to retroactively pay federal workers who are furloughed by the shutdown.

Sen. John Cornyn of Texas, the second-ranking Senate Republican, suggested that he would be uncomfortable passing the legislation without first trying to add a series of piecemeal measures designed to lessen the effect of agency closures.

Senate Democrats said they still plan to hold an up-or-down vote on the retroactive pay measure later this week, and aides predicted it would still pass overwhelmingly.

“It passed 407 to nothing in the House? This ought to be the common-sense solution at least to make sure that the workforce is OK,” said Sen. Mark Warner, R-Va.

The pain of the shutdown was lessened in Washington over the weekend after the Pentagon announced that it was recalling nearly all of its furloughed employees. But the consequences of the closure were increasingly visible worldwide Monday.

In Bali, Indonesia, Obama missed a major Pacific trade summit, which he was scheduled to attend before the shutdown scuttled his plans. Secretary of State John Kerry, the president’s stand-in, was pushed to the rear corner of an iconic photo of heads of state, a visual reminder that the standstill was costing the nation an influential presence at the gathering.

“You can see the president is busy with the domestic situation of the United States,” said Russian President Vladimir Putin. “If I was in his situation, I would not come, either.”

Back in Washington, members of both parties continued to wage battle over both the shutdown and the debt-ceiling impasse.

Obama and Reid once again called on Boehner to simply hold a vote on a bill that would reopen the government.

“I ask the speaker: Why are you afraid?” Reid said. “Are you afraid the bill will pass, the government will reopen and Americans will realize you took the country hostage for no apparent reason?”

Meanwhile, in the House, Boehner held a lunch in his office for Republicans, but lawmakers who emerged from the meeting said the group had not decided how to move forward.

A meeting of the entire Republican conference is scheduled for 9 a.m. Tuesday, but aides said rank-and-file lawmakers – incensed by what they consider Obama’s refusal to recognize their constitutional role in the budget process – will be in no mood to compromise. “We’re just waiting for the phone to ring,” one senior aide said.

Senior White House officials said Obama believes that negotiating over the government shutdown or debt ceiling would have a harmful, long-term effect on governance, effectively allowing one group to hold the government hostage.

“He’s not going to sanction negotiations with any faction that are using the threat of default as a way of enacting policy in our democracy,” Gene Sperling, director of the National Economic Council, said at a discussion held by Politico. “The era of threatening default has to be over.”

The White House says it prefers a long-term debt-limit increase, but Sperling said the duration is up to Congress to decide. “I think longer is better for economic certainty and jobs, but it is ultimately up to them,” he said.

The Post-ABC poll was conducted Oct. 2 to 6 with a random national sample of 1,005 adults reached on conventional and cellular phones. The overall results have a margin of sampling error of plus or minus 3.5 percentage points.

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