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Budget, debt unresolved by end of Day 3

Published: Friday, Oct. 4, 2013 1:15 a.m. CDT

WASHINGTON (AP) – Three days into a government shutdown, President Barack Obama pointedly blamed House Speaker John Boehner on Thursday for keeping federal agencies closed while the bitter budget dispute moved closer to a more critical showdown over the nation’s line of credit. The Treasury warned of calamitous results if Congress fails to raise the debt limit.

Answering Obama, Boehner complained that the president was “steamrolling ahead” with the implementation of the nation’s new health care law. As the government operated sporadically, the stock market sank to its lowest level in nearly a month.

The shutdown was clearly leaving its mark. The National Transportation Safety Board wasn’t sending investigators to Tennessee to probe a deadly church bus crash that killed eight people and sent 14 others to the hospital. The Labor Department said it wouldn’t release the highly anticipated September jobs report on Friday because the government remains shuttered.

Despite the heated political rhetoric, some signs of a possible way out of the shutdown emerged. But the state of play remained in flux.

Two House Republicans said Boehner told them he would allow a House vote on re-starting the entire government – but only if conservative GOP lawmakers assured him they would not attack it for failing to contain curbs on the health care law. So far they have been unwilling to give that commitment. The two spoke on condition of anonymity to reveal details of private discussions.

The shutdown and the approaching debt ceiling were merging into one confrontation, raising the stakes for the president and Congress as well as for the economy.

Obama and his Treasury Department said that failure to raise the nation’s borrowing limit, expected to hit its $16.7 trillion cap in mid-October, could precipitate an economic nosedive worse than the Great Recession. A default could cause the nation’s credit markets to freeze, the value of the dollar to plummet and U.S. interest rates to skyrocket, according to the Treasury report.

The speaker’s office reiterated Boehner’s past assertion that he would not let the United States default on its debt.

Conservatives have insisted that either reopening the government or an increase of the debt ceiling must be accompanied by a measure that either delays or defunds the nation’s new health care law.

Obama, for his part, firmly restated his opposition to a negotiation.

“You don’t get to demand some ransom in exchange for keeping the government running,” he said tartly. “You don’t get to demand ransom in exchange for keeping the economy running.”

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
 

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