(Corrects figure on budget deficit as a percentage of GDP in 27th paragraph. For more news on the shutdown, see EXT2.)
Oct. 3 (Bloomberg) -- A bipartisan group of lawmakers is proposing to House Republican and Democratic leaders a compromise to end the government shutdown by repealing a medical device tax and maintaining across-the-board spending cuts.
Representatives Charlie Dent, a Pennsylvania Republican, and Ron Kind, a Wisconsin Democrat, are leading a group of 20 lawmakers who sent House Speaker John Boehner and Minority Leader Nancy Pelosi a letter today offering the compromise.
“It is time that we break this impasse,” the lawmakers said in the letter.
While the medical device proposal has drawn support from Democrats in both chambers, Charles Schumer, the Senate’s No. 3 Democrat, said his party won’t accept a bill to fund the government that contains measures related to President Barack Obama’s health-care law.
The offer comes as more than a dozen House Republicans who want to drop attempts to undermine the health-care law and reopen the government are meeting among themselves and with Boehner.
For the past few weeks, Boehner’s hand has been guided by Tea Party-aligned Republican House members who’ve urged little compromise in their three-year drive to undo the 2010 Affordable Care Act, also known as Obamacare.
Now, the agitation is coming from the other side of the caucus. A bipartisan group of about 40 House lawmakers is holding private talks to find a compromise to end the shutdown, said Representative Reid Ribble, a Wisconsin Republican.
The number of Republicans, including Representatives Dent and Peter King of New York, pressing Boehner to call a vote on a Senate-passed spending bill free of Obamacare-related measures had grown to 20 by today, enough to pass a clean bill if all Democrats joined in. Five of them met with Boehner before he and other congressional leaders met with Obama at the White House.
“There’s a group of us -- Charlie Dent, myself and other pragmatists -- that are just spit-balling some ideas” to “help leadership bring an end to this,” said New York Representative Michael Grimm, who attended the meeting.
Boehner said after the White House session that, while “a polite conversation” took place, Obama refused to negotiate over the shutdown, signaling no movement to resolve the impasse.
According to two lawmakers who participated in the earlier gathering with Boehner, the speaker told them he wants to shift the focus to a long-term agreement to address the nation’s debt that would also avoid a clash over raising the U.S. borrowing limit later this month. The lawmakers requested anonymity when discussing the meeting.
Representative Michael Fitzpatrick, a Pennsylvania Republican who’s also part of the group, said Boehner “very clearly wants a long-term resolution that puts the country on a more solid economic and financial footing.”
Michael Steel, the speaker’s spokesman, didn’t comment on specific meetings with members, saying his boss “constantly listens to members from every part of our conference.”
The anti-shutdown wing of the party is growing, including Virginia Representatives Frank Wolf and Scott Rigell.
Their judgment is that the party is being hurt by pursuing a strategy first championed by Republican Senator Ted Cruz of Texas, a freshman lawmaker aligned with the small-government Tea Party movement who attacked Obamacare on Sept. 24 in a 21-hour speech on the Senate floor.
The Republicans pushing Boehner to work out an end to the government shutdown also oppose Obamacare. Many of them have served in Congress longer than most Tea Party members and fought against the health-care measure before it became law in 2010 and since then have sought to roll it back. Now they say that in the face of united opposition to such efforts by the Senate’s Democratic majority, Republicans must move on.
“It’s clear that you aren’t going to be successful,” said Wolf, who is serving his 17th term in the House. “You can argue about Obamacare, it’s a bad, bad bill. But you fight that in a different way, you don’t shut the government down when we are at war,” said Wolf, whose Northern Virginia district is home to many idled federal workers and contractors.
Ribble said he is among the 40 House Republicans and Democrats who, during a meeting yesterday, discussed the compromise involving repealing the medical device tax as part of a stopgap spending bill to reopen the government. Grimm confirmed this was among the options pitched to Boehner.
Repealing the 2.3 percent tax on medical equipment mandated under Obamacare won the support of 34 Senate Democrats and every Republican in March as part of a budget blueprint.
That measure shouldn’t be attached to a stopgap spending bill, Schumer said. “If we were to give in while the government is shut down to a demand, what do you think happens on the debt ceiling?” he said. “If they open the government first, we talk about it.”
Lawmakers frustrated with the Tea Party’s influence have been working behind the scenes for weeks. Ribble has spoken out during his party’s past five conference meetings to implore Boehner to redirect his party’s priorities to the entitlement programs -- Medicare and Social Security -- that pose the greatest threat to the nation’s fiscal future.
“There are a lot of sidebar conversations going on between regular House members,” Ribble said.
As Boehner is now engaging these members, their ideas may be overtaken if he and Obama broaden negotiations to the debt ceiling. The president, saying he is “exasperated,” yesterday stressed that he won’t negotiate with Republicans on the budget until they reopen the government and raise the debt ceiling without conditions.
Even so, Representative Paul Ryan, a Wisconsin Republican and chairman of the Budget Committee, said House leaders see talks “converging” over a spending deal and the debt ceiling. “From the get-go, we’ve wanted to get a budget agreement to grow this economy and get this debt under control,” he said.
Michigan Representative Dave Camp, chairman of the House Ways and Means Committee, also said “we’re at a point where we need a broader solution here.”
Camp said Treasury Secretary Jacob J. Lew called him the night of Oct. 1 to remind him that the U.S. has used “all of the extraordinary measures” to extend the nation’s borrowing power, slated to be exhausted on Oct. 17.
Unlike past fiscal feuds, this dispute is more about the health law and less about the amount of government spending. The U.S. budget deficit in June was 4.2 percent of gross domestic product, down from 10.1 percent in February 2010 and the narrowest since November 2008, when Obama was elected to his first term, according to data compiled by Bloomberg from the Treasury Department and the Bureau of Economic Analysis.
Rigell said some Republicans opposed to the strategy pursued by their House leaders remained mum until now because “there was a chance we could have gotten some movement.”
Still others have kept silent, he said, because of the threat of a primary challenge from Tea Party-backed candidates who may accuse them of breaching conservative principles.
After the 2010 census, Republicans who control the majority of state legislatures redrew many House districts to shore up vulnerable lawmakers by boosting the concentration of friendly partisan voters in their districts and packing Democrats into urban pockets. The process is called gerrymandering and both parties are adept at it.
According to David Wasserman, who analyzes House races for the nonpartisan Cook Political Report, 79 of the 236 House Republicans serving during the last partial government shutdown in 1995-96 resided in districts that Bill Clinton won in the 1992 presidential election. Today, just 17 of the 232 House Republicans are in districts that Obama won in 2012.
The redrawn lines mean the greater risks to incumbents often come from within their own party, which discourages working across the aisle, said Jim Nussle, a former Republican representative and budget director under President George W. Bush.
He also cited rapid turnover during the past two election cycles that has led to “a lot of very green people who’ve never even passed an amendment” in a subcommittee and don’t understand the legislative process.
“They’re not experienced legislators; they’re worried about primaries at home, and the new media is making it difficult for them to stake out any other position than the extreme position,” Nussle said.
He recalled the last government shutdown, when Republicans controlled both chambers of Congress and had unified policy positions with goals for a revision of the welfare system, changes in Medicare, and a balanced budget.
“I look at this and I just shake my head,” said Nussle. “This is nothing like last time,” he said. “It’s a very naïve and ignorant understanding of how to govern.”
Rigell said the party’s current predicament isn’t surprising. “We’ve essentially gerrymandered ourselves into this,” he said.
To contact the reporter on this story: Heidi Przybyla in Washington at email@example.com