Obama Summons Leaders to White House and then postpones as Impasse Persists

Monday, October 14, 2013

Obama Summons Leaders to White House and then postpones as Impasse Persists

Bloomberg.com

News

Obama Summons Leaders to White House as Impasse Persists

By Richard Rubin, Kathleen Hunter & Chris Strohm - Oct 14, 2013 11:19 AM CT

Julia Schmalz/Bloomberg

U.S. President Barack Obama will meet at 3 p.m. with House Speaker John Boehner, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell, according to a White House statement.

President Barack Obama summoned the top four congressional leaders to the White House as lawmakers remain deadlocked over how to end a partial government shutdown and prevent U.S. borrowing authority from lapsing in three days.
Obama will meet at 3 p.m. with House Speaker John Boehner, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell, according to a White House statement.
“We’re making progress,” Collins told reporters today after the meeting. “We’re going to continue to meet throughout the day and the conversations have been very constructive.”
Little evidence emerged so far to support that optimism as the government’s partial shutdown entered its 14th day and the markets weighed the time left to avert a U.S. default when the debt ceiling is reached on Oct. 17.
U.S. stocks pared losses as the Obama administration announced the meeting with the congressional leaders.
The Standard & Poor’s 500 Index slipped 0.2 percent to 1,700.03 at 12:14 p.m. in New York while the Stoxx Europe 600 Index reversed earlier declines and added 0.2 percent at the close.

Senate, House

The U.S. cash bond market is closed for Columbus Day. Gold gained 0.9 percent and natural gas jumped to the highest level in almost four months.
The Senate convenes at 2 p.m. in Washington with votes unrelated to fiscal issues planned for 5:30 p.m.
The House starts its session at noon and Republican leaders are weighing whether to bring up their plans for a short-term debt limit increase, said two aides who spoke on condition of anonymity to discuss strategy.
House Republicans will meet at 9 a.m. tomorrow to discuss the details of that proposal and whether it will include policy conditions, which Obama says he can’t accept.
“Things are back in the middle of the road on the Senate side,” Senator Bob Corker, a Tennessee Republican, told reporters in Washington. “There’s an opportunity today to bring that to a conclusion and to begin moving something off the Senate floor in a bipartisan way.”

Time Short

The congressional deadlock over increasing the U.S. debt ceiling from $16.7 trillion is threatening the U.S. and world economies, International Monetary Fund Managing Director Christine Lagarde said yesterday in Washington.
Time is running short for the Senate to pass an agreement to increase the borrowing authority and for the House to act on it before Oct. 17. The federal government would start missing payments sometime between Oct. 22 and Oct. 31, according to the Congressional Budget Office.
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CBC News

Obama postpones meeting with congressional leaders

Says Senate needs more time to resolve standoff over debt ceiling, government shutdown

The Associated Press Posted: Oct 14, 2013 1:49 PM ET Last Updated: Oct 14, 2013 3:29 PM ET

U.S. President Barack Obama speaks to reporters as he visits Martha's Table, which assists the poor and where furloughed federal employees are volunteering, in Washington Monday. Obama said that if Republicans can't resolve the standoff over the debt ceiling and the partial government shutdown, the U.S. stands 'a good chance' of defaulting on its debt. (Charles Dharapak/Associated Press)

U.S. President Barack Obama has postponed a meeting with congressional leaders to give the Senate more time to resolve a standoff over the raising of the nation's debt ceiling and the partial government shutdown, the White House announced Monday.
Obama was scheduled to meet Monday afternoon at the White House with Senate and House of Representatives leaders from the Democratic and Republican parties. A new time for the meeting wasn't announced.

The delay comes as both sides in the dispute are expressing optimism that they are getting closer to an agreement to end the two-week partial shutdown and avert a potential default on the U.S. debt.
The last meeting between Obama and the congressional leaders was Oct. 2.
Prior to the delay, both Obama and the top Democrat in Congress reported progress Monday.
"We're getting closer," Democratic Senate Majority Leader Harry Reid told reporters after he met privately with his Republican counterpart, Senator Mitch McConnell.

Default still a threat

Under discussion is an increase in the debt limit so the government can continue paying its bills well into next year, a short-term funding measure that would re-open the government and the start of overall budget negotiations.
Visiting a Washington charity that has retained furloughed government workers as volunteers, Obama said there is an increasing awareness that the current stalemate is not tenable.
"There has been some progress on the Senate side, with Republicans recognizing it's not tenable, it's not smart, it's not good for the American people to let America default," he said.

U.S. has stiffed creditors before

Despite claims that the United States has never defaulted, the record's not that clean. America has stiffed creditors on at least two occasions.
Once, the young nation had a dramatic excuse: The Treasury was empty, the White House and Capitol were charred ruins, even the troops fighting the War of 1812 weren't getting paid. A second time, in 1979, was a back-office glitch that ended up costing taxpayers billions of dollars. The Treasury Department blamed it on a crush of paperwork partly caused by lawmakers who — this will sound familiar — bickered too long before raising the nation's debt limit.
These lapses, little noted outside financial circles in their day, are nearly forgotten now.

Otherwise, he warned, the threat of default was legitimate.
"If we don't start making some real progress both in the House and the Senate, and if Republicans aren't willing to set aside some of their partisan concerns in order to do what's right for the country, we stand a good chance of defaulting," he said.
At issue are two normally routine pieces of legislation that have become entangled in disputes over Obama's health care overhaul and government spending. Congress's failure to pass a bill temporarily funding the government led to the partial shutdown on Oct. 1, the first in 17 years.
And if Congress doesn't approve a separate measure increasing the debt ceiling — the amount of money the government is allowed to borrow — the Obama administration says it will not be able to pay its bills, risking default.

Senate leaders failed to agree Sunday

The two Senate leaders, Reid and McConnell, had spoken by phone Sunday but failed to agree on a deal to raise the nation's borrowing authority above the $16.7 trillion US debt limit or reopen the government. Congress is racing the clock with Treasury Secretary Jack Lew warning that the U.S. will quickly exhaust its ability to pay the bills on Thursday.

'We're getting closer,' Democratic Senate Majority Leader Harry Reid told reporters after he met privately with his Republican counterpart Mitch McConnell Monday. (Evan Vucci/Associated Press)

Reid and McConnell — veteran senators hardened by several budget disputes and years of negotiations — are at an impasse over yet another source of fiscal fighting: the automatic, across-the-board spending cuts known as sequestration and whether to undo or change them as part of a budget deal.

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Monday, October 14, 2013