COMPILED FROM STAFF REPORTS
WASHINGTON – The political standoff that has gummed up the government for nine days as of the Florida Courier’s press time late Wednesday night showed no sign of ending as Democratic leaders dug deeper into their position that they would not negotiate with Republicans leaders in the House until the government is reopened.
Even as the government is shut down, the nation gets closer to the Oct. 17 deadline set by the Treasury Department for raising the $16.7 trillion debt limit.
After that date, the U.S. will run out of borrowing authority and be dependent on cash on hand and incoming revenues to pay the government’s bills. The Obama administration has warned that the nation will be at risk of default at that point.
An analysis Tuesday by the Bipartisan Policy Center think tank projected that the U.S. would be unable to pay all its bills between Oct. 22 and Nov. 1, when a series of large payments are due.
House Minority Leader Nancy Pelosi, D-Calif., met with Speaker John A. Boehner, R-Ohio, but the 40-minute confab in Boehner’s office showed no signs of untangling the logjam.
Pelosi, in a statement, said Democrats had agreed to lower the budget figure to $986 billion, the Republicans’ baseline spending level, and begin a conference to delve into exactly where government spending would be cut. She said she had 200 House Democrats who would accept the cuts.
However, in exchange, Democrats want the Republicans to drop efforts to derail the Affordable Care Act.
“We were disappointed the speaker did not take ‘yes’ for an answer,” Pelosi said. The No. 2 ranking House members from both parties, Eric Cantor, R-Va., and Steny H. Hoyer, D-Md., also were at the meeting.
President Obama and Vice President Joe Biden were scheduled to meet with House Democrats at the White House on Wednesday evening to talk about the shutdown debate. Some Democrats hope the president will allay concerns that the White House may open up negotiations with Republicans that could include modifying the Affordable Care Act or giving in to Republican demands for Medicare and other entitlement cuts.
Republican House leaders were scheduled to meet with Obama at the White House on Thursday. Obama invited the entire House Republican caucus, but the Republicans decided that their leaders would represent them.
Vets may suffer
Meanwhile, the Veterans Administration chief says millions of the country’s veterans could see their compensation payments halt if the political stalemate over the federal budget keeps parts of the government shuttered into late October.
Testifying at a House Veterans’ Affairs Committee hearing, Veterans Affairs Secretary Eric Shinseki, the head of the Department of Veterans Affairs, told Congress that the department’s backup funds will be depleted by the end of the month, leaving about 5.18 million veterans and their families without checks come November.
“Unless I can provide mandatory funding, to make the account solvent again, (on) Nov. 1 I will not send checks out,” Shinseki told the panel, adding that the checks total more than $6 billion in disability, compensation and pension payments.
Articulating the effects on VA services for the first time since the shutdown, Shinseki said that the department’s supply of backup funds was dwindling with halts in government funding. Staff furloughs have reversed recent progress in processing backlogged disability claims, funds to back G.I. Bill education checks are fast depleting, and the department, Shinseki said, didn’t have time to prepare.
“We looked at all the options,” he said, referring to the shutdown. “This is not one I believed would happen.”
Med centers open
Despite questions over payments, VA hospitals, clinics and centers will remain fully functioning because of appropriations approved in March, save for one joint health services venture with the U.S. Navy in North Chicago. Statements from President Obama in the days leading up to the shutdown had suggested otherwise, when he said a budget standoff in Congress would leave veterans support centers unstaffed.
A resolution continues to be stymied by Capitol Hill’s partisan politics, with several committee members blaming their Senate counterparts for holding onto a House of Representatives bill that would fully fund veterans’ services despite the shutdown.
But Shinseki testified that the bill would be only a temporary solution, as several of the VA’s federal partners would remain hostage to the budget stalemate. The Department of Labor, he said, helps with veteran employment, and the Internal Revenue Service is integral to processing compensation checks.
“I don’t do that independently,” he said.
At the White House, Carney decried the House-passed veterans benefits measure as part of a “piecemeal approach” that he labeled “gimmickry” and “irresponsible.”
“The way to fix all these problems is not to notice one in the press and then fix it, a day, a week, two weeks or a month after people have been suffering the consequences of shutdown,” Carney said. “The way to do it is to open the government.”
“What is best for veterans, and for all of us right now, is a budget for the entire federal government,” Shinseki said. “Let us get back to work. The sooner we do it, the faster we get back to full speed.”
‘Raise debt limit’
The U.S. needs to get “its act together” and raise the debt limit before a default derails the nation’s recovery and damages the world economy, a top International Monetary Fund official said Wednesday.
Short-term interest rates have risen in recent days, reflecting concerns that the fiscal standoff in Washington has not been resolved, said Jose Vinals, the director of the IMF’s monetary and capital markets department.
“This is something that would have very serious consequences through financial markets and the rest of the world,” Vinals told reporters during the annual meeting of the IMF and World Bank.
“So it is completely of the essence that the U.S. political machinery gets its act together and ends this impasse,” he said.
Ali Watkins of the McClatchy Washington Bureau and Jim Puzzanghera of the Los Angeles Times (MCT) contributed to this report.