The threat of a government shutdown loomed Tuesday as a meeting involving President Barack Obama and congressional leaders fell apart without agreement and the two sides appeared to be further apart than ever.
The potential shutdown comes on the heels of a Treasury Department report showing the country is spending at an alarming rate, and Erskine Bowles, the co-chairman of Obama’s budget committee, describing the nation’s deficit as a “cancer” that could “destroy this country” if nothing is done.
After Tuesday’s meeting with Obama, House Speaker John Boehner declared that no deal had been reached. He also warned House Republicans “will not be put in a box” by being forced to accept a deal that they do not believe is right for the American people.
With Republicans up against their self-imposed, 72-hour advance notice requirement before they will vote on any legislation, the time for a compromise is running short. The current resolution to fund government operations ends Friday.
Bowles recently told the Senate Budget Committee that he is “really concerned” the nation’s grave fiscal woes are being ignored. One sign of the growing deficit problem: The Treasury Department reported that, in March, the federal government spent eight times the amount of tax revenue it collected.
“This debt and these deficits that we are incurring on an annual basis are like a cancer and they are truly going to destroy this country from within unless we have the common sense to do something about it,” Bowles warned.
Sources say the latest impasse stems from Democrat’s demands that their cuts would be strictly temporary.
On Monday night, House Republicans introduced a third stopgap funding bill that would kick the funding can one more week down the road in return for another $12 billion in cuts. But the White House and Democrats indicated Tuesday that they have no interest in that proposal.
Analysts say President Obama’s meeting Tuesday with top Republicans appears partially designed to head off the growing impression that he has simply voted “present” as far as his leadership on resolving the budget impasse.
White House press spokesman Jay Carney on Tuesday pushed back against what he called a “great misperception” that Obama has been passive in response to the budget crisis. He told reporters that Obama has been “engaged daily” on the issue with Vice President Joe Biden and budget director Jack Lew.
Federal agencies, meanwhile, are continuing their planning in case a shutdown occurs. Primarily, this involves distinguishing between employees who would be furloughed and those deemed essential to vital government operations.
That after OMB deputy director Jeffrey Zients encouraged agency chiefs to update their contingency plans should an interruption of federal operations occur.
In an exclusive interview with Newsmax.TV on Tuesday, Sen. Charles Grassley, R-Iowa, said that “the most important thing” right now is avoiding a federal shutdown.
“I know it’s probably counterintuitive, but you don’t save money by shutting down the government because there are certain contractual obligations that have to be met regardless, Grassley tells Newsmax.
“But I can assure you that I think that saving the $100 billion, that has been the goal of the last election, and now the goal of Republicans in the Congress because that was a promise that was made, I think that we want the voters to know that we get the message from that election. And if there isn’t anything they remember that we said, we get it,” Grassley adds.
By some estimates, the last government shutdown in 1995 actually cost the federal government $1.5 billion. Visa and passport applications would go unprocessed, parks and monuments could close temporarily, and operations of less essential departments, such as the research functions in the Fish & Wildlife Department, would temporarily cease. No disruption is anticipated in Social Security mailings, however.
In the past 24 hours, it appears the two sides have moved further apart. On Monday evening, Boehner complained the administration is "just not serious" about reducing federal spending, and complained the White House proposals "are full of smoke and mirrors."
This stood in sharp contrast to the administration’s claims late last week that the two sides had agreed on $33 billion in cuts and were close to reaching a deal. Republican leaders have denied that report.
"I look forward to continuing these discussions, but for those discussions to be meaningful, it will require the White House and Senate Democrats to bring a serious proposal to carry out the people’s will of cutting spending," said Boehner on Monday.
And lest anyone think Boehner is bluffing, he ordered House Administration Committee Chairman Dan Lungren to provide instructions to all House members, specifying how the House will function in the event of a shutdown.
Republicans on Tuesday continued to complain that the Democratic-controlled Senate has yet to put forward its own proposals for how to trim federal spending to promote a deal on a continuing resolution to fund federal operations.
“We’re simply waiting for the Democrats,” Louisiana GOP Rep. John Fleming, a member of the tea party caucus, told MSNBC on Tuesday. “They’ve offered absolutely nothing in return, so the ball is in their court.”
While most Republicans join Grassley in urging that both sides find a way to avoid letting the funding lapse for normal government operations, Rep. Mike Pence, R-Ind., continues to push his GOP colleagues to shut down the government if Democrats refuse to budge.
"There’s a lot of talk about . . . whether Republicans win or Democrats win and how it plays politically. I think the American people need to win one,” Pence said Tuesday on MSNBC's Morning Joe program.
"I’ve been out here in Washington for 10 years and I’ve seen this parlor game in Washington, D.C., again. It’s always, 'Don’t cut him, don’t cut me, cut the program behind the tree.'
"This is not 1995," Pence said."The American people know that we have to take a decisive step to change the fiscal direction of our national government. Republicans said we would find $100 billion in savings off the president’s budget in this year. That would take $61 billion in cuts.
"I think the American people need to win that fight,” he said. "House Republicans I think need to dig in and demand that $61 billion number, he said. "And I think we need to dig in now.”
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