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Congress lumbers while threatened default looms

WASHINGTON (AP) – Republicans and Democrats in Congress lumbered through a day
of political maneuvering Saturday while a threatened default by the Treasury
crept uncomfortably closer and a partial government shutdown neared the end of
its second week.

“We haven’t done anything yet” by way of compromise, Majority Leader Harry
Reid, D-Nev., said after Senate leaders took control of efforts to end the
impasse, although he and other Democrats said repeatedly there was reason for
optimism.

Across the Capitol, tea party caucus Republican Rep. John Fleming of Louisiana
said there was “definitely a chance that we’re going to go past the deadline”
that Treasury Secretary Jack Lew has set for Congress to raise the $16.7
trillion debt limit.

Lawmakers in both parties said they were watching for the reaction to the
political uncertainty by the financial markets when they reopen after the
weekend.

President Barack Obama met with Senate Democratic leaders at the White House
after accusing Republicans of practicing the politics of extortion.
“Manufacturing crises to extract massive concessions isn’t how our democracy
works, and we have to stop it,” he said in his weekly radio and Internet
address.

Ironically, though, House Republicans who triggered the shutdown with tea
party-driven demands to eradicate Obama’s health law conceded that they had
temporarily been reduced to virtual bystander status.

“The Senate needs to hold tough,” Rep. Greg Walden, R-Ore., quoted Speaker
John Boehner, R-Ohio, as telling the GOP rank and file in a private meeting.
“The president now isn’t negotiating with us.”

The effects of the partial government shutdown varied widely, and in some
cases, states and outsiders were stepping in.

Officials said the Statue of Liberty would reopen on Sunday after New York
agreed to pick up the $61,600 daily tab for running the site. South Dakota and
corporate donors did the same for Mount Rushmore, beginning on Monday at a cost
of $15,200 a day. Arizona reopened the Grand Canyon on Saturday for at least one week, at a cost of $651,000.

One day after talks between the White House and House Republicans fizzled, the
focus turned to the Senate.

There, a meeting of Reid, GOP leader Mitch McConnell of Kentucky and two other
lawmakers produced no immediate sign of progress. Later, Reid and his top
lieutenants – Sens. Chuck Schumer, Patty Murray and Richard Durbin – spent more
than an hour at the White House with Obama and senior White House aides,
including Obama’s chief of staff, Denis McDonough. The leaders left without
speaking and the White House offered no summary of the meeting.

The president’s party rejected a stab at compromise led by GOP Maine Sen. Susan
Collins, while Republicans blocked the advance of a no-strings attached measure
the Democrats drafted to let the Treasury resume normal borrowing. The party
line vote was 53-45, seven short of the 60 required.

In disagreement was a pair of issues, both important and also emblematic of a
broader, unyielding dispute between the political parties over spending, taxes
and deficits.

Lew has said that without legislation to raise the nation’s $16.7 trillion debt
limit, default was possible any day, and with it, a calamitous impact on the
economy.

A separate measure was needed to reopen the government fully after 12 days of a
partial shutdown that has resulted in furloughs for 350,000 federal workers and
that administration officials warn could spread hardship if it remains in
effect.

Politicians agreed passage of both was essential.

But Republicans demanded concessions that Democrats were unwilling to give –
unless they could get something in return.

Officials in both parties said that Democrats had raised the possibility with
Republicans of a long-term spending bill that included deficit savings that
could replace some or all of the across-the-board spending cuts that began
taking effect at the beginning of the year.

The political calculations were evident. Polls show all portions of the
electorate except tea party supporters are increasingly displeased, and
Republicans are bearing the brunt of their unhappiness.

“Perhaps he sees this as the best opportunity for him to win the House in
2014,” Fleming said of the president. “It’s very clear to us he does not now,
and never had, any intentions of negotiating.”

Reid was savage.

Republicans had begun seeking concessions on health care, he said, and now
their No. 1 issue is “to divert attention from the fools they’ve made of
themselves on Obamacare.”

House Democrats lined up en masse to sign a legislative petition calling on
Boehner to allow a vote on a bill to reopen the government, a step he has
repeatedly refused to take.

In his Saturday address, Obama said, “Politics is a battle of ideas, but you
advance those ideas through elections and legislation – not extortion.”

Collins’ suggested compromise had gained traction in recent days, before Reid
told McConnell it was a nonstarter.

In a statement, the Maine Republican called the response unfortunate, and said
talks on the plan involving senators of both parties “were constructive and
give me hope that a bipartisan solution to reopen government and prevent default
is within our reach.”

It could have raised the debt limit through Jan. 31 and reopened the government
for six months.

At the same time, it would have granted federal agencies flexibility in
adjusting to the across the board cuts, and made two changes in the health care
law.

One would have set new income verification conditions on individuals applying
for federal subsidies for coverage; the other would have suspended a medical
device tax for two years.

Associated Press writer Jim Kuhnhenn contributed to this report.

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