Republican Clash With Obama Adds Risk of Shutdown

Sept. 20 (Bloomberg) -- The U.S. House voted to finance the federal government through mid-December and choke off funding for President Barack Obama’s health-care law, setting up a showdown with the Senate and the White House. The Republican-controlled House today passed, 230-189, a stopgap measure to fund government operations after current authority expires Sept. 30. The spending measure now will be sent to the Senate it will pass without defunding the health-care law, Majority Leader Harry Reid of Nevada said yesterday. (Source: Bloomberg)

House Speaker John Boehner and Republicans leaders tried to craft a spending bill that would avoid a fiscal showdown on Oct. 1.

With 10 days left before current funding runs out, it’s not at all clear their plan will work, and the risk of a government shutdown is intensifying.

Republicans in the House yesterday voted to choke off funding for President Barack Obama’s health-care law in the stopgap spending bill. Senate Democratic leaders said they won’t pass a bill that takes money away from the 2010 health-care law.

With Republican Ted Cruz vowing to hold a filibuster, the Senate debate could drag out through the week and into next weekend. Once the health measure is stripped out, House Republican leaders could revise the bill and send it back to the Senate as time runs out, raising the risk of a shutdown.

“We have a long way to go,” Representative Tom Cole, an Oklahoma Republican, told reporters yesterday in Washington. “This may send something back, we may send something back.”

Some Senate Republicans, including John McCain of Arizona, have said the chamber won’t pass changes to the health law. McCain, in an interview this week, called efforts to defund the law a political “suicide note.”

Photographer: J. Scott Applewhite/AP Photo

Speaker of the House John Boehner, R-Ohio, right, is cheered as Republican members of the House of Representatives rally after passing a bill that would prevent a government shutdown while crippling the health care law that was the signature accomplishment of President Barack Obama's first term, at the Capitol in Washington, on Sept. 20, 2013. Close

Speaker of the House John Boehner, R-Ohio, right, is cheered as Republican members of... Read More

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Photographer: J. Scott Applewhite/AP Photo

Speaker of the House John Boehner, R-Ohio, right, is cheered as Republican members of the House of Representatives rally after passing a bill that would prevent a government shutdown while crippling the health care law that was the signature accomplishment of President Barack Obama's first term, at the Capitol in Washington, on Sept. 20, 2013.

After passing the bill 230-189 to keep the government open through Dec. 15 and strip health-law funding, party leaders outlined plans for raising the ceiling on government borrowing. Republican leaders said they will offer a bill that will cut billions of dollars in spending, delay the health law and ease regulations in a bid to force concessions from Obama.

Shutdown Looms

The twin fiscal fights are testing the Republicans’ resolve in stopping the health law and Obama’s insistence on implementing it without delay. If Congress doesn’t act, the government will shut Oct. 1 and be unable to borrow to pay all its bills later in the month. Each side is counting on the other to blink first.

Obama today urged lawmakers to meet the deadlines for reaching an agreement on government spending and on raising the nation’s borrowing limit. “I will not allow anyone to harm this country’s reputation, or threaten to inflict economic pain on millions of our own people, just to make an ideological point,” the president said in his weekly address.

House Republicans said they wouldn’t accept Senate Majority Leader Harry Reid’s plan to remove the health-care language from the bill next week and warned of a temporary government shutdown after the fiscal year ends Sept. 30.

Photographer: J. Scott Applewhite/AP Photo

The House spending measure also includes a provision directing the Treasury on how to prioritize payments if the debt ceiling is breached. Close

The House spending measure also includes a provision directing the Treasury on how to... Read More

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Photographer: J. Scott Applewhite/AP Photo

The House spending measure also includes a provision directing the Treasury on how to prioritize payments if the debt ceiling is breached.

‘We’re Serious’

“We’ll add some other things that they hate and make them eat that, and we’ll play this game up until either Sept. 30, Oct. 3, somewhere in between,” said first-term Representative Richard Hudson, a North Carolina Republican. “Harry Reid’s going to realize we’re serious and hopefully at that point, he’ll begin to negotiate with us.”

The spending legislation preserves across-the-board spending cuts at an annual rate of $986.3 billion and permanently defunds the Affordable Care Act.

“The fight to delay Obamacare doesn’t end next week. It keeps going on until we get it,” Representative Paul Ryan, a Wisconsin Republican and his party’s 2012 vice presidential nominee, told reporters yesterday in Washington.

Democratic Representatives Jim Matheson of Utah and Mike McIntyre of North Carolina voted with the Republicans. Representative Scott Rigell, a Virginia Republican, opposed the measure, saying it wouldn’t replace automatic spending cuts or address reliance on short-term funding measures.

Obama Veto

“Republicans are simply postponing for a few days the inevitable choice they must face: pass a clean bill to fund the government, or force a shutdown,” Reid said in a statement. “Republicans here in Washington are using these stunts to raise money and grab headlines.”

Obama administration officials repeatedly have said the president would veto the House bill if sent to him by Congress.

“Congress is not meeting the test of helping middle-class families,” Obama said yesterday at a Ford Motor Co. plant in a suburb of Kansas City, Missouri. “They’re focused on trying to mess with me.”

Obama called Boehner yesterday to tell him he wouldn’t negotiate on the debt ceiling, the White House and the speaker’s office said in separate statements. The president urged Congress against a “self-inflicted wound,” according to the White House, while Boehner was “disappointed” by Obama’s stance against negotiation, the Ohio Republican’s office said.

Health-Law Delay

Should House Republicans eventually remove the health-law provisions from the spending bill and accept Reid’s plan, they will focus even more intently on getting a one-year delay in the health law as part of the debt limit. Obama says he won’t negotiate on this point.

The House is assembling a bill to suspend the borrowing limit until Dec. 31, 2014, according to a proposal distributed by party leaders to Republican members and obtained by Bloomberg News.

The bill, expected to save at least $256 billion, would also include other party priorities, such as approval of the Keystone XL pipeline, increasing means testing for Medicare and cutting government regulations.

The debt-limit bill would encourage offshore energy production, energy production on federal lands and block Environmental Protection Agency greenhouse-gas and coal-ash regulations.

‘Everything Necessary’

Also being considered is a proposal to eliminate a provision in the Dodd-Frank Act that would end regulators’ authority to seize and dismantle financial firms if their failure could damage the stability of the U.S. financial system.

Another proposal would gut mandatory spending for the Consumer Financial Protection Board and revise the federal employees’ retirement system.

Cruz, a Texas Republican and chief Senate opponent of the health law, said he’s willing to do “everything necessary and anything possible,” including holding a filibuster, to thwart action on the spending measure as a way to end funding for the health-care law. He called yesterday for party unity.

“Senate Republicans should stand side-by-side with courageous House Republicans,” Cruz said in a statement.

The Senate probably will start considering the legislation on Sept. 23 with goal of finishing by Sept. 26.

Democratic leaders are considering a procedural tactic that would put Cruz and his allies in an awkward spot and upend their efforts. Under Senate rules, they could have a simple majority vote that would strip the health-care defunding language once they end debate on the House measure.

‘Reckless Plan’

The Democratic Senatorial Campaign Committee, the party’s campaign arm, is targeting House members who voted for the spending bill and are seeking Senate seats in Arkansas, Georgia, Louisiana, Montana and West Virginia. All are states carried by Republican presidential nominee Mitt Romney in 2012.

“Democrats will hold Republicans accountable for their reckless plan to shut down the government and ignore the danger their actions pose to the country,” the Democratic committee said in a statement.

When asked about Republican leaders’ plans for dealing with the bill sent back from the Senate, Representative Peter Roskam of Illinois said that there are “all sorts of things being discussed” to “get rid of Obamacare.” Roskam is the House Republicans’ chief deputy whip.

If Boehner allows the Senate bill to go forward, he would need enough Democratic votes to join Republicans to pass it and avoid a government shutdown.

That’s the probable path, said Hudson and Representative Charles Boustany, a Louisiana Republican.

“We can ultimately prevail on this if we stand tough,” Hudson said. “We’re willing to give up quite a bit in negotiations, but we’ve got to get to the point where they believe they need to negotiate with us.”

To contact the reporters on this story: Roxana Tiron in Washington at rtiron@bloomberg.net; Richard Rubin in Washington at rrubin12@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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