Shutdown Day 14: Days Before Debt Limit Deadline and No Deal in Sight

Posted on October 14, 2013

Senate leaders Harry Reid (D-NV) and Mitch McConnell (R-KY) continued negotiations over the weekend – searching for a deal that would raise the debt limit and reopen the government, but emerged with no deal in sight yet. A bipartisan group of 12 Senators are also currently in-closed door meetings this morning trying to work out the parameters of an agreement.

Some details about a potential plan from the Senate have emerged:

Funding to run the government for 6 months
Extend debt limit until Jan. 31, 2014
Delay of the medical-device tax for 2 years
More leeway provided to federal agencies to implement sequester cuts
Mandate House-Senate budget talks

The sticking points right now seem to be the exact length of any extension of government funding or a debt ceiling increase, and FY14 spending levels. Democrats have indicated that they are willing to accept the $986 billion first-year sequester cap that was previously agreed upon, while Republicans are pushing for a cut in government spending a cap of $967 billion to be put in place in January.

While no concrete deal has been released, there seems to be a bit more optimism emerging from both parties. However, even if the Senate can agree on a bipartisan deal, it is unclear what the reaction would be by the House. Boehner would have a few options – pass a House deal that would need to go to the Senate for unlikely approval, pass the Senate bill which would be a clear defeat for the House GOP, or amend and pass a version of the Senate bill with addition terms.

Shutdown: Day 12 and Progress!

Posted on October 12, 2013

Congressional leaders continue to work toward reopening government and extend the debt limit before the October 27^th deadline. While details are vague, it appears that the proposal would immediately end the shutdown and fund federal agencies for six months at current spending levels. It would maintain the automatic cuts, or sequester, but give agency officials more flexibility to decide where the cuts should fall rather than just mandating across-the-board cuts (although some agencies may ultimately decide to implement some uniform reductions). In addition, the proposal would raise the debt limit through January 31, 2014.

It is unclear at this point whether the proposal will also include directions to House and Senate budget committees to immediately enter negotiations over broader budget issues and to issue a report by January 15, 2014. If an agreement could be reached, it would clear a path for another increase in the debt limit later that month, without additional drama.

In exchange, Republicans may seek minor adjustments to health care reform. The first would delay for two years a 2.3 percent tax on medical devices that is unpopular in both parties. The second would require internal auditors to ensure that people who get tax subsidies to buy health insurance are in fact eligible.

House GOP leaders are meeting this morning to discuss their options. Both chambers are scheduled to meet today and could possible begin moving a compromise proposal forward to end the current fiscal crisis.

Shutdown: Day Eleven Brings a Glimmer of Hope

Posted on October 11, 2013

Negotiations to end the government shutdown and raise the debt limit continued into the night Thursday after House Republicans and President Obama failed to reach an agreement on ending the fiscal standoff during a White House meeting earlier in the day. The GOP favors a temporary increase in the debt ceiling through November 22^nd but would require an agreement from Democrats to negotiate on a broader deal that could include tax and entitlement reforms. They could add in a provision to also reopen government but that is not clear yet. Meanwhile, a plan by Senator Susan Collins (R-ME) would do both and also repeal or delay the health care law’s medical device tax and give federal agencies flexibility to deal with the decade-long automatic spending cuts under sequestration during the next two years. In addition to that proposal, Senate Majority Leader Harry Reid (D-NV) will bring up a bill that would just raise the debt limit, possibly requiring vote on Saturday.

Shutdown: Day Ten

Posted on October 10, 2013

Lawmakers made no visible progress Wednesday on a stopgap spending bill to reopen federal government with the Senate once again rejecting piecemeal funding bills favored by the House. The funding impasse has kept the government shut down since the new federal fiscal year began October 1^st.

The focus today is on a White House meeting between President Obama and House Republican leaders aimed at trying to find an opening for ending the shutdown. One proposal from House Budget Chairman Paul Ryan (R-WI) will certainly be part of the discussion. Ryan’s plan calls for a six-week, $118 billion debt limit increase with dollar-for-dollar budget cuts. Before the increase is approved, however, both the House and Senate would have to agree to overhaul the tax code and entitlement programs during those six weeks and pass them, along with a long-term debt limit increase, when the six-week period expires. Finally, it would have some enforcing trigger, although the specifics were not announced, nor were the specifics of the cuts Ryan is seeking. It appears to be a similar proposal to previous ones that the Democrats have already rejected and it doesn’t specifically address the government shutdown. But it does signal that the GOP has finally shifted away from defunding the health reform law to broader fiscal issues.

The Ryan proposal seems to a starting point for discussions that will take place with President Obama today, but the ultimate outcome is still uncertain. Even if everyone comes to some agreement to this short-term debt limit increase in exchange for reopening government, it seems unlikely that lawmakers can resolved their differences on tax and entitlement issues in just six weeks. And if the “enforcing trigger” is anything like what happened with sequestration, then we may be facing more pain before this is all over.

Shutdown: One-Week Anniversary and Nothing to Celebrate

Posted on October 8, 2013

There is no new progress on Capitol Hill to end the week old government shutdown. Instead of the usual update, I thought you might enjoy reading what we’re reading. The following articles provide some insights into possible paths forward and the impacts of the shutdown outside the beltway.

On Capitol Hill

House Republicans Unlikely to Pass Debt Ceiling Bill this Week – House Republicans have no plans to try to pass a bill to hike the nation’s borrowing limit this week, according to Republican aides. Instead, Speaker John Boehner’s (R-OH) chamber will use the week to continue to pass targeted spending bills in an attempt to reopen parts of the currently shuttered government. Those bills have been rejected by Senate Democrats and President Barack Obama.

GOP Senators Weigh Blocking Democrats on Debt Ceiling – Senate Democrats are getting to work on a long-term debt ceiling hike with no strings attached, and Senate Republicans must decide whether or not to block it.

GOP Proposes New Supercommittee to Resolve Impasse – House Republicans will bring to the floor a bill to create a bipartisan, bicameral committee to address the current fiscal impasse that has shut down much of the government and threatens a debt default.

Will a Sidecar Help Avert Debt Limit Disaster? – With both Speaker John A. Boehner and President Barack Obama stuck in their corners on reopening the government, the dispute over the debt ceiling has taken center stage.

Senate Republicans Hesitate On Back Pay For Furloughed Workers – A bill the House passed to guarantee that furloughed federal workers receive back pay after the partial government shutdown is resolved seems to have hit a snag in the Senate. The measure passed the House unanimously on Saturday and has the backing of the White House, so eventual passage through the Senate seems assured. Federal workers have received back pay in previous shutdowns, even as they’re left with unscheduled days off. Unless a worker is deemed essential under agency guidelines, it is illegal for them to work or receive pay during a lapse in federal funding.

Shutdown: ‘A pox on everybody’s house’ – Democrats have the advantage in the government shutdown debate, but it’s not the rout that many anticipated. While polls show that more people blame Republicans than Democrats, the margin is not so lopsided that GOP leaders feel compelled to back down.

One-Story Town Gives a Furlough to Nonessential Legislation – And on the seventh day, Congress did not rest. Instead, lawmakers decided for the first time since the shutdown began to take votes on something wholly unrelated to their own budgetary wheel-spinning.

Impacts of Shutdown

Northeastern University President Urges Military to Resume Tuition Aid – Tuition assistance, money for active-duty military to pursue an education, has been suspended in the shutdown and won’t be retroactively issued for classes that began after October 1st. Northeastern University President Joseph Aoun, whose institution is covering the costs for affected students, urged Hagel to restore those benefits, too.

Billionaire Philanthropists Keep Head Start Afloat During Shutdown – Head Start doors will remain open through the end of October after philanthropists offered up to $10 million to the embattled institution.

This cancer patient’s treatment is on hold because of the government shutdown

Despite Government Cutbacks, Student Interest in Public Sector Careers Grows – Hundreds of thousands of government workers remain furloughed this week as politicians fight another round of the seemingly never-ending battle over the federal budget. At the state and local level, many agencies hit with steep funding cuts in the aftermath of the recession still haven’t recovered, either.  But despite the bleak employment outlook and negative rhetoric, younger Americans don’t appear deterred from pursuing careers in public service.