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Government Reopens As Obama Says Shutdown Damaged US Economy

President Barack Obama says the government shutdown "inflicted unnecessary damage" to the U.S. economy and damaged America

Photos: NBC News

The government unlocked its doors Thursday after 16 days, with President Barack Obama saluting the resolution of Congress' bitter standoff but lambasting Republicans for the partial shutdown that he said had damaged the U.S. economy and America's credibility around the world.

"There are no winners here," Obama said just hours after signing a last-minute measure from Congress that was free of the Republican demands that had started the standoff. The deal allowed federal workers to return Thursday morning and headed off the threat that the nation would default on its debts, at least for this year.

"The American people are completely fed up with Washington," Obama said in stern remarks at the White House. The nation's credit rating was jeopardized, economic growth and hiring were slowed and federal workers were temporarily deprived of paychecks, Obama said, all because of "yet another self-inflicted crisis."

In hopes of averting another standoff when the just-passed measure runs out, Congress' four top budget writers met over breakfast to begin new budget talks. Obama urged them to put aside partisan differences and brinkmanship tactics to find common ground.

He also sought to assure governments and investors around the world that the "full faith and credit of the United States remains unquestioned."

"We'll bounce back from this," Obama declared. "We always do."

The House and Senate voted late Wednesday night to end the shutdown that began when Republicans tried unsuccessfully to use must-pass funding legislation to derail the president's landmark health care law.

Early Thursday, Obama signed the measure and directed all agencies to reopen promptly. The government unlocked office doors, carried barriers away from national monuments and lifted entrance gates at parks across the country.

The relief felt by furloughed federal employees was tempered by worry that the truce might not last much past the holidays. Congress approved government funding only through Jan. 15.

To head off a default, the package gives the government the authority to borrow what it needs through Feb. 7. Treasury officials will be able to use bookkeeping maneuvers to delay a potential default for several weeks beyond that date, as they have done in the past. Among the maneuvers, officials can suspend contributions to one of the pension plans used by federal retirees.

In the meantime, lawmakers will try to find agreement on how to replace this year's across-the-board spending cuts with more orderly deficit reduction.

"I hope this is the end of this," said Vice President Joe Biden, who greeted workers returning to the Environmental Protection Agency with hugs, handshakes and muffins. But Biden acknowledged, "There's no guarantees of anything."

The small group of lawmakers tasked with steering Congress out of three years of budget stalemates and standoffs offered no promises.

House Budget Committee Chairman Paul Ryan, R-Wis., said the group's goals were "to get this debt under control, to do smart deficit reduction and to do things that we think will grow the economy and get people back to work."

"We believe there is common ground," Senate Budget Committee Chairman Patty Murray, D-Wash., said after their meeting.

The impasse furloughed about 800,000 workers at its peak, before civilian Defense Department employees were called back. It closed down most of NASA, the Environmental Protection Agency and the Interior Department and halted work not considered critical at other agencies.

"We're back from the #shutdown!" the Smithsonian Institution crowed on Twitter, announcing that museums were reopening Thursday. The U.S. Capitol's visitor center planned to resume tours. "Closed" signs started coming down at national parks and offices across the nation, hours after the deal was sealed in Washington.

Congress agreed to pay federal workers for the missed time. No such luck for contractors and all sorts of other workers whose livelihoods were disrupted.

"More business. More money," cab driver Osman Naimyar said happily, noting the growing crowds of commuters on Washington streets. He lost about a fifth of his normal fares, he said, while federal workers stayed home and tourists disappeared from the National Mall.

Standard & Poor's estimated the shutdown has taken $24 billion out of the economy, and the Fitch credit rating agency warned Tuesday that it was reviewing its AAA rating on U.S. government debt for a possible downgrade.

Obama and his Democratic allies on Capitol Hill were the decisive victors in the fight, which was sparked by tea party Republicans including Sen. Ted Cruz of Texas. They prevailed upon skeptical GOP leaders to use a normally routine short-term funding bill in an attempt to "defund" the 2010 health care law known as "Obamacare."

"We fought the good fight. We just didn't win," House Speaker John Boehner, R-Ohio, conceded. He was given positive reviews from Republicans for his handling of the crisis, though it again exposed the tenuous grasp he holds over the fractious House GOP conference.

Republican Sen. John McCain of Arizona said the American people disapproved of how Republicans, and also Democrats and the president, handled the budget gridlock.

"Hopefully, the lesson is to stop this foolish childishness," McCain said Thursday on CNN.

The shutdown sent approval of the GOP plummeting in opinion polls and exasperated veteran lawmakers who saw it as folly.

"It's time to restore some sanity to this place," House Appropriations Committee Chairman Harold Rogers, R-Ky., said before the vote.

The agreement was brokered by the Senate's top Democrat, Majority Leader Harry Reid of Nevada, and its Republican leader, Mitch McConnell of Kentucky. They stepped in after the House was unable to coalesce around a Republican-only approach.

McConnell is up for re-election next year, and the tea party opponent he faces in the Republican primary issued a statement criticizing him for making the deal.

"When the stakes are highest, Mitch McConnell can always be counted on to sell out conservatives," Matt Bevin said.

The Senate approved the legislation by an 81-18 vote. The House followed suit by a tally of 285-144, with 87 Republicans in favor and 144 against. Democrats unanimously supported the bill, even though it kept across-the-board funding cuts they opposed.

(Copyright 2013 by The Associated Press. All Rights Reserved.)


Previous Story

President Barack Obama says the government shutdown "inflicted unnecessary damage" to the U.S. economy and damaged America's credibility around the world.

Obama spoke from the White House hours after signing legislation to reopen the government following 16 days of a partial shutdown.

The deal came the night before the nation's debt limit was facing a breach.

Obama said while "these twin threats to our economy have now been lifted," the shutdown slowed economic growth.

Obama says the way that business is done in Washington has to change.

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)


Previous Story

The government reopened its doors Thursday after a battle-weary Congress approved a bipartisan measure Wednesday to end a 16-day partial shutdown and avert the possibility of an economy-jarring federal default.

President Barack Obama signed the measure early Thursday, ending a brawl with Republicans who tried to use the must-pass legislation to mount a last-ditch effort to derail Obama's landmark health care law and demand concessions on the budget.

The impasse had shuttered national parks and mostly closed down NASA and the Environmental Protection Agency. Critical government functions went on as usual, but the closure and potential default weighed on the economy and spooked financial markets.

Obama and his Democratic allies were the decisive winners.

Standard & Poor's estimated the shutdown has taken $24 billion out of the economy.



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WASHINGTON (AP) — Congress has passed legislation to reopen the partially-shuttered federal government and avert a potentially disastrous default on U.S. obligations, clearing the measure for President Barack Obama's promised signature.

Passage of the bill late Wednesday in the House and Senate ended a Washington-created crisis that closed much of government for 16 days. It came on the eve of the date the Treasury Department warned it would no longer be able to borrow to pay the government's bills.

The legislation was carried to passage in the House by strong support from Democrats and 87 yes votes from majority Republicans who had originally sought to use the measure to derail Obama's three-year-old health care law.

The legislation will reopen the government through Jan. 15 and permit Treasury to borrow normally through Feb. 7.
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WASHINGTON (AP) — The Senate has voted to avoid a financial default and reopen the government after a 16-day partial shutdown.

The vote was 81-18 Wednesday night. The measure now heads to the House, which is expected to back the bill before day's end.

Senate passage came several hours after Majority Leader Harry Reid and Minority Leader Mitch McConnell announced the bipartisan compromise.

The bill would reopen the government through Jan. 15 and permit the Treasury to borrow normally through Feb. 7 or perhaps a month longer.

Congress faced a deadline of 11:59 p.m. on Thursday. That's when Treasury Secretary Jacob Lew had said the government would reach the current $16.7 trillion debt limit and could no longer borrow to meet its obligations.
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The U.S. Senate reconvened about 7:30 p.m. Wednesday, to vote on a bill to reopen government and avoid default.

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Up against one last deadline, Congress raced to pass legislation Wednesday avoiding a threatened national default and ending a 16-day partial government shutdown along the strict terms set by President Barack Obama when the twin crises began.

"We fought the good fight. We just didn't win," conceded House Speaker John Boehner as lawmakers lined up to vote on a bill that fell far short of Republican wishes.

A Senate vote was set first on the legislation, which would permit the Treasury to borrow normally through Feb. 7 or perhaps a few weeks longer, and fund the government through Jan. 15. More than two million federal workers — those who had remained on the job and those who had been furloughed — would be paid under the agreement.

Across the Capitol, members of the House marked time until their turn came to vote.

After weeks of gridlock, the measure had support from the White House, most if not all Democrats in Congress and many Republicans fearful of the economic impact of a default. As a result, there was little or no doubt it would pass both houses and reach the White House in time for Obama's signature before the administration's Oct. 17 deadline.

That was the day that Treasury Secretary Jacob Lew said the Treasury would reach the current $16.7 trillion debt limit, and could no longer borrow to meet its obligations.

Tea party-aligned lawmakers who triggered the shutdown that began on Oct. 1 said they would vote against the legislation. Significantly, though, Texas Sen. Ted Cruz and others agreed not to use the Senate's cumbersome 18th century rules to slow the bill's progress.

"The compromise we reached will provide our economy with the stability it desperately needs," said Senate Majority Leader Harry Reid, declaring that the nation "came to the brink of disaster" before sealing an agreement.

Senate Republican Leader Mitch McConnell, who negotiated the deal with Reid, emphasized that it preserved a round of spending cuts negotiated two years ago with Obama and Democrats. As a result, he said, "government spending (in one major category of programs) has declined for two years in a row" for the first time since the Korean War. "And we're not going back on this agreement," he added.

McConnell made no mention of the polls showing that the shutdown and flirtation with default have sent Republicans' public approval plummeting and have left the party badly split nationally as well as in his home state of Kentucky. He received a prompt reminder, though.

"When the stakes are highest Mitch McConnell can always be counted on to sell out conservatives," said Matt Bevin, who is challenging the party leader from the right in a 2014 election primary.

More broadly, national tea party groups and their allies underscored the internal divide. The Club for Growth urged lawmakers to vote against the congressional measure, and said it would factor in the organization's decision when it decides which candidates to support in midterm elections next year.

"There are no significant changes to Obamacare, nothing on the other major entitlements that are racked with trillions in unfunded liabilities, and no meaningful spending cuts either. If this bill passes, Congress will kick the can down the road, yet again," the group said.

The U.S. Chamber of Commerce came out in favor of the bill.

Simplicity at the end, there was next to nothing in the agreement beyond authorization for the Treasury to resume borrowing and funding for the government to reopen.

House and Senate negotiators are to meet this fall to see if progress is possible on a broad deficit-reduction compromise of the type that has proved elusive in the current era of divided government.

Additionally, Health and Human Services Secretary Kathleen Sebelius is to be required to produce a report stating that her agency is capable of verifying the incomes of individuals who apply for federal subsidies under the health care law known as Obamacare.

Obama had insisted repeatedly he would not pay "ransom" by yielding to Republican demands for significant changes to the health care overhaul in exchange for funding the government and permitting Treasury the borrowing latitude to pay the nation's bills.

Other issues fell by the wayside in a final deal, including a Republican proposal for the suspension of a medical device tax in Obamacare and a Democratic call to delay a fee on companies for everyone who receives health coverage under an employer-sponsored plan.

The gradual withering of Republicans' Obamacare-related demands defined the arc of the struggle that has occupied virtually all of Congress' time for the past three weeks.

The shutdown began on Oct. 1 after Cruz and his tea party allies in the House demanded the defunding of the health care law as a trade for providing essential government funding.

Obama and Reid refused, then refused again and again as Boehner gradually scaled back Republican demands.

The shutdown initially idled about 800,000 workers, but that soon fell to about 350,000 after Congress agreed to let furloughed Pentagon employees return to work. While there was widespread inconvenience, the mail was delivered, Medicare continued to pay doctors who treated seniors and there was no interruption in Social Security benefits.

Still, national parks were closed to the detriment of tourists and local businesses, government research scientists were sent home and Food and Drug Administration inspectors worked only sporadically.

Obama and Boehner both came to the same conclusion — that they would allow the shutdown to persist for two weeks, until it became politically possible to reopen government and address the threat of default at the same time.

As Republican polls sank, Boehner refused to let the House vote on legislation to reopen the entire government, insisting on a piecemeal approach that the White House and Reid rejected as insufficient.

As the Oct. 17 debt-limit deadline approached, there were warnings from European officials as well as Cabinet members and bankers in this country that failure to raise the debt limit invited an economic disaster far worse than the near-meltdown of 2008.

On Tuesday, the Fitch credit rating agency said it was reviewing its AAA rating on U.S. government debt for possible downgrade.

By then, the endgame was underway.

Late last week, Obama met with Boehner and House Republicans at the White House. The session resulted in brief follow-up talks in which GOP aides suggested easing the across-the-board spending cuts in exchange for changes in benefit programs such as making Medicare more expensive for better-off beneficiaries.

After that faltered, Reid and McConnell announced over the weekend they were seeking a deal to solve the crises, and expressed hope they could quickly come to an agreement.

That effort was suspended on Tuesday, a day of suspense in which Boehner made one last stab at a conservatives' solution. When his rank and file refused to coalesce around any proposal, he gave up and McConnell and Reid returned to their labors.

(Copyright 2013 by The Associated Press. All Rights Reserved.)


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Senate leaders announced last-minute agreement Wednesday to avert a threatened Treasury default and reopen the government after a partial, 16-day shutdown. Congress raced to pass the measure by day's end.

The Dow Jones industrial average soared on the news that the threat of default was fading, flirting with a 200-point gain in morning trading.

"This is a time for reconciliation," said Senate Majority Leader Harry Reid of the agreement he had forged with the GOP leader, Sen. Mitch McConnell of Kentucky.

McConnell said that with the accord, Republicans had sealed a deal to have spending in one area of the budget decline for two years in a row, adding, "we're not going back."

One prominent tea party lawmaker, Sen. Ted Cruz of Texas, said he would oppose the plan, but not seek to delay its passage.

That was a key concession that signaled a strong possibility that both houses could act by day's end. That, in turn, would allow President Barack Obama to sign the bill into law ahead of the Thursday deadline that Treasury Secretary Jacob Lew had set for action to raise the $16.7 trillion debt limit.

While the deal could meet resistance from conservatives in the Republican-controlled House, the Democratic Leader, Rep. Nancy Pelosi of California, supports the plan and says her rank and file is expected to vote for it in overwhelming numbers. That raised the possibility that more Democrats than Republicans would back it, potentially causing additional problems for House Speaker John Boehner as he struggles to manage his tea party-heavy majority.

In any case, the House was likely to approve the measure later in the day.

Officials said the proposal called for the Treasury to have authority to continue borrowing through Feb. 7, and the government would reopen through Jan. 15.

The White House welcomed the compromise and spokesman Jay Carney said the president looked forward to signing it into law.

In political terms, the final agreement was almost entirely along lines Obama had set when the impasse began last month. Tea party conservatives had initially demanded the defunding of the health care law as the price for providing essential federal funding.

Under a strategy set by Obama and Reid, Democrats said they would not negotiate with Republicans in exchange for performing what the White House called basic functions of keeping the government in operation and preventing Treasury from defaulting on its obligations.

A long line of polls charted a steep decline in public approval for Republicans in the course of what Sen. John McCain, R-Ariz., pronounced a "shameful episode" in the nation's history.

Wednesday's developments came one day before the deadline Lew had set for Congress to raise the current $16.7 trillion debt limit. Without action by lawmakers, he said, Treasury could not be certain it had the ability to pay bills as they come due.

In addition to raising the debt limit, the proposal would give lawmakers a vote to disapprove the increase. Obama would have the right to veto their opposition, ensuring he would prevail.

House and Senate negotiators would be appointed to seek a deficit-reduction deal. At the last minute, Reid and McConnell jettisoned a plan to give federal agencies increased flexibility in coping with the effects of across-the-board cuts. Officials said that would be a topic for the negotiations expected to begin shortly.

The deal would provide back pay to the 800,000 federal workers affected by the shutdown, including half who have been idled for more than two weeks.

Despite initial Republican demands for the defunding of the health care law often derided as "Obamacare," the pending agreement makes only one modest change touching on the program. It relates to a requirement that individuals and families seeking subsidies to purchase coverage verify their incomes before qualifying.

The deal was reached after dire warnings from the financial world. The Fitch credit rating agency said it was reviewing its AAA rating on U.S. government debt for possible downgrade. John Chambers, chairman of Standard & Poor's Sovereign Debt Committee, told "CBS This Morning" that a U.S. government default on its debts would be "much worse than Lehman Brothers," the investment firm whose 2008 collapse led to the global financial crisis.

The Senate pact had been put on hold Tuesday, an extraordinary day that highlighted how unruly rank-and-file House Republicans can be, even when the stakes are high. Facing solid Democratic opposition, Boehner tried in vain to write legislation that would satisfy GOP lawmakers, especially conservatives.

Boehner crafted two versions of the bill, but neither made it to a House vote because both faced certain defeat. Working against him was word during the day from the influential group Heritage Action for America that his legislation was not conservative enough — a worrisome threat for many GOP lawmakers whose biggest electoral fears are of primary challenges from the right.

Boehner's inability to produce a bill that could pass his own chamber likely means he will have to let the House vote on a Senate compromise, even if that means it would pass with strong Democratic and weak GOP support. House Republican leaders have tried to avoid that scenario for fear that it would threaten their leadership, and some Republicans worried openly about that.

(Copyright 2013 by The Associated Press. All Rights Reserved.)


Previous Story

Democratic leader Harry Reid says Senate leaders have reached a bipartisan deal to avoid default and end the government shutdown, now in its 16th day.

Reid made the announcement at the start of the Senate session on Wednesday.

The deal would reopen the government through Jan. 15 and increase the nation's borrowing authority through Feb. 7.

Reid thanked Republican leader Mitch McConnell for working out an agreement.


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Senate leaders reached agreement Wednesday to avert a threatened Treasury default and reopen the government after a partial, 16-day shutdown, according to a Republican senator who also said the House might vote first on the plan to speed its approval.

The New York Stock Exchange soared on the news that the threat of default was easing in, rising nearly 200 points by late morning.

"I understand they've come to an agreement but I'm going to let the leader announce that," Sen. Kelly Ayotte, R-N.H., said as she walked into a meeting of Senate Republicans called to review details of the emerging deal struck by Senate Majority Leader Harry Reid and GOP Leader Mitch McConnell.

Officials said the proposal called for the Treasury to have authority to continue borrowing through Feb. 7, and the government would reopen through Jan. 15.

Speaker John Boehner and the House Republican leadership met in a different part of the Capitol to plan their next move.

The developments came one day before the deadline Treasury Secretary Jack Lew had set for Congress to raise the current $16.7 trillion debt limit. Without action by lawmakers, he said, Treasury could not be certain it had the ability to pay bills as they come due.

In addition to raising the debt limit, the proposal would give lawmakers a vote to disapprove the increase. President Barack Obama would have the right to veto their opposition, ensuring he would prevail.

House and Senate negotiators would be appointed to seek a deficit-reduction deal, but there is no provision for federal agencies to have increased flexibility in coping with the effects of across-the-board cuts.

Despite initial Republican demands for the defunding of the health care law known as Obamacare, the pending agreement makes only one modest change in the program. It requires individuals and families seeking subsidies to purchase coverage to verify their incomes before qualifying.

There were some dire warnings from the financial world a day after the Fitch credit rating agency said it was reviewing its AAA rating on U.S. government debt for possible downgrade.

John Chambers, chairman of Standard & Poor's Sovereign Debt Committee, told "CBS This Morning" on Wednesday that a U.S. government default on its debts would be "much worse than Lehman Brothers," the investment firm whose 2008 collapse led to the global financial crisis.

Billionaire investor Warren Buffett told CNBC he doesn't think the federal government will fail to pay its bills, but "if it does happen, it's a pure act of idiocy."

Rep. Steve King, R-Iowa, a tea party favorite, said he was not worried about the prospect of a U.S. default.

"We are going to service our debt," he told CNN. "But I am concerned about all the rhetoric around this ....I'm concerned that it will scare the markets."

Aides to Reid and McConnell said the two men had resumed talks, including a Tuesday night conversation, and were hopeful about striking an agreement that could pass both houses.

It was expected to mirror a deal the leaders had neared Monday. That agreement was described as extending the debt limit through Feb. 7, immediately reopening the government fully and keeping agencies running until Jan. 15 — leaving lawmakers clashing over the same disputes in the near future.

It also set a mid-December deadline for bipartisan budget negotiators to report on efforts to reach compromise on longer-term issues like spending cuts. And it likely would require the Obama administration to certify that it can verify the income of people who qualify for federal subsidies for medical insurance under the 2010 health care law.

But that emerging Senate pact was put on hold Tuesday, an extraordinary day that highlighted how unruly rank-and-file House Republicans can be, even when the stakes are high. Facing solid Democratic opposition, Boehner tried in vain to write legislation that would satisfy GOP lawmakers, especially conservatives.

Boehner crafted two versions of the bill, but neither made it to a House vote because both faced certain defeat. Working against him was word during the day from the influential group Heritage Action for America that his legislation was not conservative enough — a worrisome threat for many GOP lawmakers whose biggest electoral fears are of primary challenges from the right.

The last of Boehner's two bills had the same dates as the emerging Senate plan on the debt limit and shutdown.

But it also blocked federal payments for the president, members of Congress and other officials to help pay for their health care coverage. And it prevented the Obama administration from shifting funds among different accounts — as past Treasury secretaries have done — to let the government keep paying bills briefly after the federal debt limit has been reached.

Boehner's inability to produce a bill that could pass his own chamber likely means he will have to let the House vote on a Senate compromise, even if that means it would pass with strong Democratic and weak GOP support. House Republican leaders have tried to avoid that scenario for fear that it would threaten their leadership, and some Republicans worried openly about that.

"Of all the damage to be done politically here, one of the greatest concerns I have is that somehow John Boehner gets compromised," said Sen. Lindsey Graham, R-S.C., a former House member and a Boehner supporter.

With the default clock ticking ever louder, it was possible the House might vote first on a plan produced by Senate leaders. For procedural reasons, that could speed the measure's trip through Congress by removing some parliamentary barriers Senate opponents might erect.

The strains of the confrontation were showing among GOP lawmakers.

"It's time to reopen the government and ensure we don't default on our debt," Rep. Jaime Herrera Beutler, R-Wash., said in a written statement. "I will not vote for poison pills that have no chance of passing the Senate or being signed into law."

(Copyright 2013 by The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)


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Time growing desperately short, House Republican efforts to pass legislation averting a Treasury default and ending a partial government shutdown collapsed Tuesday night, and one of the country's top ratings firms warned of a possible downgrade in the nation's creditworthiness.

The decision by Speaker John Boehner and the GOP leadership to pull a bill they had unveiled earlier in the day appeared to mark the end of what amounted to a daylong detour from separate negotiations in the Senate that had appeared on the verge of bearing fruit.

There was no immediate reaction from Senate Majority Leader Harry Reid or the Republican leader, Sen. Mitch McConnell, on next steps as divided government sought to extricate itself from yet another crisis.

As the day of secret meetings and frenzied maneuvering unfolded in all corners of the Capitol, Sen. Barbara Mikulski, D-Md., stood on the Senate floor at midafternoon and declared, "We are 33 hours away from becoming a deadbeat nation, not paying its bills to its own people and other creditors."

In New York, the Fitch rating agency warned that it was reviewing the government's AAA credit rating for a possible downgrade, though no action was near. Fitch, one of the three leading U.S. credit-ratings agencies, said that "the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default."

On Wall Street, the Dow Jones industrial average fell 133 points after rising a day earlier when optimism spread that a deal might be at hand.

Under the revised bill prepared by House Republicans, the Treasury would be permitted to borrow normally until Feb. 7 and the government reopened with sufficient funds to carry it to Dec. 15.

Additionally, members of Congress, the president, vice president and thousands of aides would no longer be eligible to receive employer health care contributions from the government that employs them.

Before the bill seemed to lose steam later in the day, Michael Steel, a spokesman for Speaker John Boehner said in a statement, "The House will vote tonight to reopen the government and avoid default."

He said the legislation would "end Obamacare subsidies for elected officials and staff in Washington, D.C., and pressure Senate Democrats to accept more sensible" time frames for reopening the government and renewing Treasury's borrowing authority.

Gone from the measure was a pair of provisions that had drawn objections, one a plan to delay a medical device tax created under the new health care law known as Obamacare. The other would have imposed tougher income verification standards on individuals and families seeking subsidies for care under the law.

Democrats had viewed both as concessions to Republicans, and deemed their inclusion as a violation of Obama's vow not to pay a "ransom" to the GOP for passing essential funding and borrowing measures.

Even with the changes, it was unclear whether Boehner and the GOP leadership had the votes to pass their measure.

Heritage Action, a group with close tea party ties, announced it would oppose the measure because "it will do absolutely nothing to help Americans who are negatively impacted by Obamacare." It said it would include the vote in its determinations next year on which candidates to support in the midterm elections.

The day's events prompted an outbreak of partisan rhetoric, mixed with urgent warnings that both the U.S. and global economies could suffer severe damage quickly unless Congress acted by Thursday.

Even something of an appeal for heavenly aid was thrown in, as Rep. Steve Southerland of Florida led House Republicans in a rendition of "Amazing Grace" at the beginning of a rank-and-file meeting called to discuss a way out of the impasse.

Speaking with reporters, Boehner said, "I have made clear for months and months that the idea of default is wrong and we shouldn't get anywhere close to it."

But the first measure the leadership produced evidently came up short on votes, and the White House trashed it as an attempt to "appease a small group of tea party Republicans who forced the government shutdown in the first place. "

Democrats jumped on Boehner and the plan he produced.

In unusually personal remarks, Senate Majority Leader Harry Reid said the Ohio Republican had "once again tried to preserve his role at the expense of the country."

That was a reference to a rebellious rank and file in the House, who routinely seek to push Boehner and the rest of the leadership to the right. A group met Monday night with Texas Sen. Ted Cruz, who last summer played a public role in a campaign to demand defunding of Obamacare as the price for preventing a partial government shutdown.

The Democratic attacks were too much for some Republicans who have been among those most vocal in calling for a bipartisan solution to the impasse.

"It's piling on and it's not right," Sen. John McCain, R-Ariz., said of the response from the Democrats. "To categorically reject what the House and the speaker are doing - and I think he's pretty courageous in what he's doing - in my view is not serving the American people."

The House had been effectively sidelined in recent days as Reid and Senate Republican Leader Mitch McConnell engaged in intense negotiations to reopen the government and raise the debt limit.

That changed emphatically when details began circulating of some of the elements of the terms under discussion.

In addition to ending the shutdown and raising the debt limit, the two Senate leaders were considering a plan to delay a $63-per-person fee that the health care overhaul would impose on anyone who receives health care coverage under an employer-provided plan.

Some Republicans balked, complaining that was a concession to labor unions who are among the Democrats' most loyal political supporters.

Many unions have announced their opposition to the fee, but so, too, have businesses.

Reid and McConnell also have been discussing provisions to give federal agencies flexibility in adjusting to across-the-board spending cuts imposed under legislation that Obama signed in 2011.

Another element of their negotiations would call for House-Senate negotiations on a possible deficit reduction measure to take the place of the across-the-board cuts.

The twin crises began more than three weeks ago, when some lawmakers in the House insisted on seeking the defunding of Obamacare as the price for preventing a partial shutdown of the government.

The White House refused, and the Democratic-controlled Senate rejected legislation to achieve the GOP goal, as well as subsequent legislation that contained scaled-back concessions on the health care overhaul.

The partial shutdown, which began on Oct. 1, swiftly merged with the approaching debt crisis.

According to Treasury Secretary Jacob Lew, unless Congress acts by Oct. 17, the government will lose its ability to borrow, and would be required to meet its obligations relying only on cash on hand and incoming tax receipts.

While it was unclear how long that would suffice, the date stood as a deadline. The closer it approached, the more urgent became the pleas of businesses and bankers in this country as well as officials overseas for the United States to put its finances into order.

Whatever the outcome, the all-out assault on Obamacare that became a tea party rallying cry last summer was long gone, repulsed by the president and his Democratic allies in Congress.

Instead, Republican disapproval ratings have plummeted in public opinion polls in the past two weeks, vindicating warnings from Boehner, McConnell and other party elders that the original strategy of threatening to shut down the government in hopes of wiping out the overhaul was badly flawed.

"We got ourselves in a ditch," McCain said. "And we got to stop digging."

Beyond Washington, Fitch Ratings said it expected to conclude its review of the nation's top credit rating within six months.

Fitch said it expected the debt limit to be raised soon but added, "The political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default." Fitch is one of the three leading U.S. credit ratings agencies, along with Standard & Poor's and Moody's.


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