Boehner Plan on Debt Limit Collapses Amid Shutdown Fight

House Speaker John Boehner’s plan to avert a shutdown by shifting to a debt-ceiling fight ran into opposition from some Republicans today -- another setback in efforts to keep the government operating after Sept. 30.

As the U.S. Senate plans to vote tomorrow on a $986.3 billion stopgap spending bill and send it back to the House, it’s uncertain if both chambers can strike a deal before funding authority expires.

The options are complicated after the Senate strips out the House’s plan to defund Obamacare. Boehner and House Republicans say they will offer other proposals before sending the measure back to the Senate, which could require another series of votes -- as time runs out before an Oct. 1 shutdown.

Boehner said today the House wouldn’t pass a “clean” spending bill after the Senate acts and then said he has “no interest in seeing a government shutdown.”

“There will be options available to us, there’s not going to be any speculation about what we’re going to do or not do, until the Senate passes their bill,” he said.

Boehner today had outlined for members a plan that would pair spending cuts, looser regulations and a delay in Obamacare with an increase in U.S. borrowing authority. Representatives Paul Broun of Georgia, Louie Gohmert of Texas, Tim Huelskamp of Kansas and Mo Brooks of Alabama said today were opposed.

“It looks like a $1 trillion increase and it doesn’t meet the Boehner one-for-one rule,” Huelskamp, who opposed Boehner as speaker, said today in an interview. He said the debt-limit bill also doesn’t balance the U.S. budget in 10 years.

Republican Opposition

At this point, Huelskamp said “at least 18” members would oppose the plan. Starting tomorrow, Republicans will hold a 232-200 House majority, and can lose only 15 members on a party-line vote.

In 2011, Boehner had supported a dollar-for-dollar match between spending cuts and the debt ceiling increase. Now he’s pairing “reforms and cuts” with the debt-limit increase and counting the expected revenue that would stem from faster growth caused by lighter regulation.

“This debt-ceiling package does not fix the underlying cause of the problem, which are the deficits,” Brooks told reporters at the Capitol today. “We need to significantly cut government spending.”

In the Senate today, Majority Leader Harry Reid’s effort to move up a vote on the spending measure to tonight was thwarted by the objection of Republican Mike Lee of Utah. Instead, the Senate will hold several votes tomorrow on the stopgap bill, which party leaders said will exclude Republican language denying funds for the health-care law.

Lee, Cruz

After Lee and Ted Cruz, the Texas Republican who opposed Obamacare in a 21-hour Senate floor speech this week, voiced their objections, Senator Bob Corker said he was confused that both men wanted to delay the vote.

“It’s not the Republican side that’s asking to stall,” said Corker, a Tennessee Republican. “We only have two Republican senators who are asking to put this off” and most party members ’’would actually like to give the House time to respond in an adequate way.’’

Reid has said the Senate will remove the defunding language before sending the spending measure back to the House. The Senate also will shorten by a month to Nov. 15 the period for the stopgap funding.

Republicans said they think they can force President Barack Obama to accept concessions in a debt-limit fight, although he has said repeatedly that he won’t negotiate. According to a Bloomberg National Poll conducted Sept. 20-23, 61 percent of respondents say that it’s “right to require spending cuts when the debt ceiling is raised even if it risks default,” because Congress lacks spending discipline.

Means Testing

The Republican debt-limit bill would seek to increase means-testing for Medicare, reduce the Medicaid provider tax, revise medical malpractice law and eliminate a public-health fund as part of the 2010 law. Republicans also want to eliminate a tax on medical devices and require a Social Security number in order to receive a child tax credit, according to the proposal.

U.S. stocks rose, ending the longest slump this year for the Standard & Poor’s 500 Index, after an unexpected drop in jobless claims overshadowed growing concern that a budget impasse could hurt the economic recovery.

Obama said Republicans are becoming increasingly “irresponsible” in their attempts to thwart the health-care law and are trying to “blackmail” him.

No Negotiations

“I will not negotiate on anything when it comes to the full faith and credit of the United States,” Obama said in a speech today to promote his health-care law at Prince George’s Community College in Largo, Maryland, a suburb of Washington. “Congress needs to put an end to governing crisis-to-crisis.”

Without congressional action on the debt limit, the government will run out of borrowing authority on Oct. 17, Treasury Secretary Jacob J. Lew told lawmakers yesterday.

After that, the government would have to operate on a cash basis and would be unable to pay its bills sometime from Oct. 22 to Oct. 31, the Congressional Budget Office said.

Representative John Fleming, a Louisiana Republican, said House Republicans would “continue to fight” for limits on the health-care law in the spending bill. Fleming said leaders also discussed contingency plans for a shutdown.

“There is always a possibility, that is not the goal at all, we don’t want to shut down government but we can’t control what the Senate does,” Fleming said.

‘Adult Approach’

Senator Richard Durbin of Illinois, the chamber’s second ranking Democrat, said it wouldn’t be responsible for the Senate to take longer than necessary to return send the proposal back to the House.

“What we’re trying to do is a responsible, adult approach: Do it in a timely fashion so that agencies of government are not sweating bullets about Tuesday morning,” Durbin said. “We’re not playing games here and waiting until the last minute. We’re trying to get this done as quickly as we can.”

The divided Congress is still in the early stages of a dispute that will play out over the next few weeks as the U.S. nears the end of its fiscal 2013 spending authority and reaches the $16.7 trillion cap on borrowing.

With a few exceptions, Democrats are steadfast as they fend off major policy changes in the health law, particularly if attached to what they see as a routine bill to keep the government running or legislation to prevent a first-ever U.S. default.

Playing ‘Poker’

Republicans are “playing high-stakes poker with other people’s money,” Durbin said. “The next step is to threaten the debt ceiling. The victims will include not just federal employees but employees all across America.”

Senator Joe Manchin, a West Virginia Democrat, said today at a Bloomberg Government breakfast that he would support a one-year delay in the individual mandate to buy health insurance, which begins in 2014, breaking with his party. He called a delay “very reasonable and sensible.”

Republicans are considering a one-year delay in the implementation of the health law’s individual mandate and postponing the federal data hub connecting state health exchanges with agencies including the Internal Revenue Service.

The spending bill is H.J. Res 59. The device tax repeal is H.R. 523.

To contact the reporters on this story: Richard Rubin in Washington at rrubin12@bloomberg.net; Roxana Tiron in Washington at rtiron@bloomberg.net; Kathleen Hunter in Washington at khunter9@bloomberg.net

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

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