Boehner seeking Democrats’ help on fiscal talks
With Congress momentarily freed from the Syrian crisis, lawmakers plunged back into their bitter fiscal standoff on Thursday as Speaker John A. Boehner appealed to the Obama administration and Democratic leaders to help him resolve divisions in the Republican ranks that could lead to a government shutdown by month's end.
In meetings with Democratic and Republican Congressional leaders on Thursday after a session with Treasury Secretary Jacob J. Lew on Wednesday, Mr. Boehner sought a resumption of negotiations that could keep the government running and yield a deficit-reduction deal that would persuade recalcitrant conservatives to raise the government's borrowing limit.
Much of the federal government will shut down as of Oct. 1 unless Congress approves new spending bills to replace expiring ones, and by mid-October, the Treasury Department will lose the borrowing authority to finance the government and pay its debts.
"It's time for the president's party to show the courage to work with us to solve this problem," said Mr. Boehner, who argued that budget deals have been part of past agreements to raise the debt limit
(Read more: 43% of households pay no income tax: Study)
But a bloc of 43 House Republicans undercut the speaker's deficit-reduction focus, introducing yearlong funding legislation that would increase Pentagon and veterans spending and delay President Obama's health care law for a year — most likely adding to the budget deficit. That bloc is large enough to thwart any compromise that does not attract Democratic support.
"Obamacare is the most dangerous piece of legislation ever passed in Congress," said Representative John Fleming, Republican of Louisiana. "It is the most existential threat to our economy" that the country has seen "since the Great Depression, so I think a little bit of additional deficit is nothing," he added.
Just five scheduled legislative days stand between the House and a government shutdown that has loomed for months. As of now, Republican leaders appear to have no idea how to stop it. House members are preparing for the worst. Representative Scott Rigell, Republican of Virginia, began circulating a 14-page fact sheet on the impact of a government shutdown.
Mr. Lew and Congressional Democrats held firm that they would no longer negotiate on raising the debt ceiling, which they see as the duty of the party in power in the House. And they made it clear to the speaker that they would never accept Republican demands to repeal, defund or delay Mr. Obama's signature health care law. White House officials dismissed it as "a nonstarter."
"I had to be very candid with him and I told him directly, all these things they're doing on Obamacare are just a waste of their time," said Senator Harry Reid, Democrat of Nevada and the Senate majority leader. "Their direction is the direction toward shutting down the government."
"I like John Boehner," Mr. Reid added. "I do feel sorry for him."
Earlier this week, Representative Eric Cantor of Virginia, the No. 2 House Republican, proposed a two-step resolution to the fiscal impasse that was temporarily pushed into the background by Mr. Obama's request for approval to initiate a military strike on Syria, since delayed.
Under Mr. Cantor's plan, the House would have voted this week on a stopgap spending bill to keep the government operating through mid-December at the current level, which reflects the sharp across-the-board cuts known as sequestration. That bill would have a companion resolution to withhold all money for the health care law, but the Senate could simply ignore that resolution and approve the short-term spending bill.
(Read more: Debt talks could get ugly, but sequestration?)
Then the House would vote to raise the debt ceiling enough for a year of borrowing, but demand a year's delay in carrying out the health care law.
Within 24 hours, the House's most ardent conservatives revolted, declaring the defunding resolution a gimmick that fell well short of their drive to undo the health care law. House Democrats said they would oppose not only stripping the health care law of money but also a spending level that maintains sequestration.
"The continued operation of the sequester is inimical to the interest of the United States, to the government, to the people and to international security," said Representative Steny H. Hoyer of Maryland, the Democratic whip, who promised to hold his members against the Cantor plan.
It was delayed indefinitely as House Republicans resumed their search for a measure that could unite them. One group of conservatives on Thursday pressed what they called a compromise: a one-year stopgap spending bill that would raise the debt ceiling for a year, delay all aspects of the health care law for a year, and give back some of the Pentagon cuts as a sweetener.
Backers insisted on Thursday that it was a package Mr. Obama should be able to accept. Representative Phil Gingrey, Republican of Georgia, said seven Democratic senators facing re-election fights next year in Republican-leaning states would provide a beachhead of Democratic support, and noted the president had already agreed to some delays for his health law.
(Read more: US Treasury to hit debt limit by mid-October)
Democrats scoffed at the Republican plans, and even some Republican leadership aides questioned how any could get to the president's desk. Mr. Reid called the succession of proposals "juvenile political games" and suggested that many Republicans had lost touch with reality.
Senator Richard J. Durbin of Illinois, the second ranking Democrat, said, "Sometimes I sympathize with Speaker Boehner, but the fact of the matter is, if he wants to lead for the good of the nation, he has to step beyond the Tea Party faction of his caucus."
Republican divisions were manifest not only in the tactics they have proposed but also in the strategic aims of those tactics. Mr. Boehner continued to emphasize taming the budget deficit as the price for a debt-ceiling increase.
But the urgency of that mission was undercut by government financing figures released Thursday by the Treasury, which showed the smallest annual shortfall since 2008. In the first 11 months of the current fiscal year, the deficit reached $755.8 billion, with tax revenues rising and spending falling. The deficit in fiscal 2012 was $1.1 trillion.
With no resolution in sight, Republican leaders said decisions would have to be made next week on a way forward—with Democratic votes, or Republican unity. But Mr. Boehner gave no indication he knew which way to turn.
"There are a million options that are being discussed by a lot of people," he said. "When we have something to report, we'll let you know."
—By Jonathan Weisman of The New York Times