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US shutdown looms amid stalemate

Source BBC News@ tienganhvui.com


The US Capitol dome in Washington. Photo: September 2013The US Congress remains deadlocked over the funding bill


Last-minute negotiations are expected to take place in Washington between Democrat and Republican lawmakers to try to agree a new budget.


If they fail to reach a deal by midnight (04:00 GMT Tuesday), the US government will be forced to close all non-essential federal services.


More than 700,000 staff could be sent home on unpaid leave, with no guarantee of back pay once the deadlock is over.


The shutdown would be the first in the US for 17 years.


One of the key reasons for the political stalemate has been President Barack Obama's healthcare law, popularly known as Obamacare.



Impact of shutdown



  • State dept will be able to operate for limited time

  • Dept of defence would continue military operations

  • Dept of education would still distribute $22bn (£13.6bn) to public schools, but staffing would be severely hit

  • Department of energy - 12,700 staff would be sent home, 1,113 to oversee nuclear arsenal

  • Department of health and human services to send home more than half of staff

  • The Federal Reserve, dept of homeland security, justice

  • US Postal Services would continue as normal

  • Smithsonian institutions, museums, zoos and many national parks would be closed



Early on Sunday, the Republican-run House of Representatives passed an amended version of the Senate spending bill that removed funding from the healthcare law, raising the chances of a shutdown.


US Senate Majority leader Harry Reid has vowed that his Democrat-led chamber will reject the Republican bill.


"Tomorrow, the Senate will do exactly what we said we would do and reject these measures," said Adam Jentleson, a spokesman for Mr Reid.


"At that point, Republicans will be faced with the same choice they have always faced: put the Senate's clean funding bill on the floor and let it pass with bipartisan votes, or force a Republican government shutdown."


Speaking for the president, White House spokesman Jay Carney said: "Any member of the Republican Party who votes for this bill is voting for a shutdown." The president, he said, would also veto the Republican bill.


If the government does shut down on 1 October, national parks and Washington's Smithsonian museums would close, pension and veterans' benefit cheques would be delayed, and visa and passport applications would go unprocessed.


Programmes deemed essential, such as air traffic control and food inspections, would continue.



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The shenanigans in Congress are more twisted than a sack of snakes, but the basics are easy to get straight”



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The defence department has advised employees that uniformed members of the military will continue on normal duty, but that large numbers of civilian workers will be told to stay home.


Borrowing crisis

The looming shutdown is not the only crisis the US government is facing.


The US government and Republicans are also at loggerheads over extending the government's borrowing limit.


US Treasury Secretary Jack Lew has warned that the US will hit its debt ceiling by 17 October, leaving the government with half the money needed to pay its bills.





AAA-rating


The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is minuscule.




Earlier this month, Mr Lew said that unless the US was allowed to extend its borrowing limit, the country would be left with about $30bn (£18.5bn) to meet its commitments, which on certain days can be as high as $60bn.


A failure to raise the limit could also result in the US government defaulting on its debt payments.


President Obama has warned that "failure to meet this responsibility would be far more dangerous than a government shutdown".


Washington faced a similar impasse over its debt ceiling in 2011. Republicans and the Democrats only reached a compromise on the day the government's ability to borrow money was due to run out.


That fight was resolved just hours before the country could have defaulted on its debt, but nevertheless led to ratings agency Standard & Poor's downgrading the US for the first time ever.


The 2011 compromise included a series of automatic budget cuts known as the "sequester" which came into effect earlier this year.





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