Spending dispute leaves a Senate deal elusive

Published 5:00 am Monday, October 14, 2013

The Statue of Liberty looms over visitors Sunday as they mill about Liberty Island in New York Harbor. The Statue of Liberty reopened to the public after the state of New York agreed to shoulder the costs of running the site during the partial federal government shutdown.

WASHINGTON — With a possible default on government obligations just days away, Senate Democratic leaders — believing they have a political advantage in the continuing fiscal impasse — refused Sunday to sign on to any deal that reopens the government but locks in more budget cuts for next year.

The disagreement extended the stalemate that has kept much of the government shuttered for two weeks and threatens to force a federal default.

Most Popular

The core of the dispute is about spending, and how long a stopgap measure that would reopen the government should last. Democrats want across-the-board cuts known as sequestration to last only through mid-November; Republicans want them to last as long as possible. The Democrats’ demand shows a newfound aggressiveness. Previously, they had favored a so-called clean bill that would reopen the government and lift the debt ceiling without any policy changes attached. With Republicans on the defensive, it remains unclear whether the Democrats are using a negotiating ploy to raise the likelihood that any final deal will include their priorities as well as the Republicans’.

Democrats said that Sens. Harry Reid of Nevada, the majority leader, and Mitch McConnell of Kentucky, the Republican leader — who spoke only briefly by telephone on Sunday — were inching forward and that a breakthrough was possible before the default deadline on Thursday.

“They had a good conversation,” Sen. Charles Schumer of New York, the No. 3 Democrat, said Sunday. “They are moving closer together, and I’m hopeful the Senate can save the day.”

Republicans accused Democrats of accepting nothing short of capitulation without offering anything in return. “The Democrats keep moving the goal posts,” said Sen. Susan Collins of Maine, one of the lead Republican negotiators. “Decisions within the Democratic conference are constantly changing.”

A rally on the National Mall, led by Sen. Ted Cruz, R-Texas, and former Gov. Sarah Palin of Alaska, was intended to show that Tea Party activists — supporters of the House Republicans who forced the shutdown over their opposition to the health care law — were in no mood to give in. Some waved Confederate flags and called for President Barack Obama to be impeached.

U.S. topic dominates international talks

Leaders at World Bank and International Monetary Fund meetings Sunday pleaded, warned and cajoled: The United States must raise its debt ceiling and reopen its government or risk “massive disruption the world over,” as Christine Lagarde, the IMF’s managing director, put it.

The fiscal problems of the United States overshadowed the official agendas for the meetings, with representatives from dozens of countries — including two of Washington’s most important economic partners, Saudi Arabia and China — publicly expressing worries about what was happening on Capitol Hill and in the White House.

The leaders came to Washington to talk about the international recovery, Lagarde said in an interview on the NBC News program “Meet the Press.” “Then they found out that the debt ceiling was the issue,” she said. “They found out that the government had shut down and that there was no remedy in sight.”

With only three days left before a potential default, Senate leaders failed Sunday to reach agreement on a plan to reopen the government and raise the debt limit.

Many leaders at the World Bank and IMF meetings said they believed the impasse would be resolved before Thursday, when the government would be at severe risk of not having enough money to pay all its bills on any given day going forward.

— New York Times News Service

Marketplace