Barack Obama is hosting senior Republicans today to seek an opening in an impasse that has shut down much of the government and threatens a catastrophic federal default.
The White House meeting comes as House Republican leaders contemplate a short-term debt limit increase designed to calm financial markets and allow more time to resolve the partial government shutdown which has entered its 10th day as the US faces a first-ever default between October 17 and the end of the month.
A short-term debt limit measure is expected to be a topic at a closed-door House Republican meeting. It is nott clear what conditions party leaders might seek to attach to the bill, if any, but conservatives have been pushing senior Republicans like speaker John Boehner to add conditions beyond what Mr Obama says he will accept.
Treasury secretary Jacob Lew is heading to Capitol Hill to both give and get a public scolding. His appearance before the Senate Finance Committee promises to be yet another public restatement of the administration’s stance that Congress needs to reopen the government and lift the US borrowing cap before the president will negotiate over the nation’s budget ills.
The debate over increasing the debt limit – required so Treasury can borrow more money to pay the government’s bills in full and on time – already has resulted in stock market losses, spiked the interest rate for one-month Treasury bills and prompted Fidelity Investments, the nation’s largest manager of money market mutual funds, to sell federal debt that comes due around the time the nation could hit its borrowing limit.
Yesterday saw a lot of activity but no progress towards ending the budget and debt limit deadlocks.
Mr Obama hosted House Democrats at the White House, while Republican conservatives heard a pitch from the House Budget Committee chairman Paul Ryan on his plan to extend the US borrowing cap for four to six weeks while jump-starting talks on a broader budget deal that could replace cuts to defence and domestic agency budgets with cuts to benefit programmes like Medicare and reforms to the loophole-cluttered tax code. Curbs to the new health care reform law were not mentioned.
At the White House, Mr Obama told Democratic loyalists he would prefer a long-term increase in the nation’s 16.7 trillion dollar borrowing cap but that he is willing to sign a short-term increase to “give Boehner some time to deal with the tea party wing of his party”, said Democrat. Peter Welch, referring to the conservative anti-tax group.
A meeting between the two top House Republicans and Democrats yielded no progress. Rival aides to Mr Boehner and Democratic leader Nancy Pelosi even disagreed over who asked for the meeting. Aides said Ms Pelosi had a long-ignored request for a meeting with Mr Boehner that he unexpectedly granted on short notice.
Mr Obama invited the entire House Republican contingent to the White House today but Mr Boehner opted to send a smaller contingent of about 20 mostly senior members, which prompted White House press secretary Jay Carney to issue an unusual statement criticising the move to exclude tea party Republicans from the session.