The impending Government Shutdown

It was an alert to seniors, military families, medical service providers and others who will be in dire straights without advanced warning of a possible shutdown

The bankers are the Chinese, Japanese, Brits et all....who look upon failures of the American political system as threats to their investment. At the moment rates are moving down because of Mid East instability, but American political leaders should take no comfort in that. The 90's shut down happened with the world believing in America and with a generally sound economy. We got away with it last time, but we are unlikely to repeat that free pass for failure now.

I do not think any foreign governments will be able to sway the Republican House at all.

WITH ONE WEEK TO GO BEFORE THE SHUTDOWN DEADLINE.... Policymakers in Washington have exactly one week to steer clear of the government-shutdown iceberg, and as of yesterday, some of the relevant players weren't even trying to work on this.

Not only are the halls of Congress empty, but House Speaker John Boehner (R-Ohio) spent the day playing golf in Florida. (In 1995, as a government shutdown loomed, Boehner blasted then-President Bill Clinton for playing a round while Congress continued its work. "Now is the time, not to play golf as the president did yesterday, now is the time to act," Boehner said at the time.)

In the upper chamber, though, Senate Democrats were tackling a new proposal to keep the lights on. For much of the week, the discussion has centered on how to shape a temporary extension that would give lawmakers time for additional negotiations. That's proved far more difficult than it should -- for Democrats, the line is, "Let's give ourselves more time to discuss budget cuts." For Republicans, the line is, "Give us budget cuts first, and then we'll discuss budget cuts."

So, yesterday, the Senate majority began work on a new tack.

With a political standoff over spending threatening to trigger a federal shutdown next week, Senate Democrats began drafting a plan Thursday to slice billions of dollars from domestic agency budgets over the next seven months, yielding to Republican demands to reduce the size of government this year.

The plan will involve accelerating some of the $33 billion in program terminations and reductions included in President Obama's proposed budget for next year, a senior Senate Democratic aide said Thursday. Democrats are also looking at cuts that have been adopted by the Republican-controlled House, such as a plan to strip $8.5 billion for pet projects known as earmarks out of a measure aimed at keeping the government running through Sept. 30.

"This would be a compromise," the aide said, "accepting something that they've already asked for."

This approach appears intended to simply wrap up the work for the rest of the fiscal year, bypassing the need for a temporary extension. To accommodate Republican demands, Senate Democrats would include extensive budget cuts, effectively taking cuts the White House proposed for next year's budget, and incorporating them into the remainder of this year's.

It's unclear exactly how deep these cuts would be -- they won't be $61 billion -- and House Republicans have not said whether they'd consider such a plan.

The strategy is not without risk. Democrats continue to move closer to the Republican position, in the hopes of appearing reasonable and open to compromise. This, in turn, would make the GOP even more responsible for a shutdown, should it occur next week. At the same time, if House Republican leaders see Dems already making concessions -- something the GOP has refused to do -- it wouldn't be surprising if Boehner & Co. continued to hold out and see how much further Democrats would be willing to go.

Once again, the inflexible deadline hasn't changed, and time is running short. Yesterday, I said there's an 85% chance of a shutdown. As of this morning, I'd put it at 87%.
—Steve Benen 8:00 AM Permalink | Trackbacks | Comments (25)

wandeljw - I'm not a gov employee. I'm a contractor still. That said, it wouldn't make a difference. On my site, the government employees will have to show up for work even if the government shuts down. That's how things go in defense. Same goes for my roommate. He works for the NRC. He'll have to work and won't get paid. Furlow isn't a option for some jobs. Republican or Democrat, this will raise hell in Washington.

I'd say about a quarter of my friends here are Federal employees. Most of them are pretty much watching the minute hand waiting for this to happen.

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The post office will still be up and running. They say they're 'self-funding'.

Stop laughing!

The Republican insiders think a shutdown will be a disaster (for them). They remember the last one.

http://hotlineoncall.nationaljournal.com/archives/2011/02/gop-insiders-du.php

WASHINGTON — House Republicans on Friday urged Senate Democrats to accept $4 billion in cuts as a compromise to keep the government running for two weeks past a March 4 deadline.

"A government shutdown is not an acceptable or responsible option for Republicans," House Majority Leader Eric Cantor of Virginia said in a conference call where he and other Republicans promoted their plan for avoiding the first government shutdown since 1996.

They said failure to work out a deal would put the responsibility for a disruption of government services on the Democrats.
Story: Sources: Senate Dems consider spending cuts

With only a week left before federal spending authority runs out, both parties have sought to preemptively blame the other if a shutdown does occur. Democrats who control the Senate have rejected as draconian a bill passed by the House last week that would fund the government through the end of the fiscal year on Sept. 30 while carrying out $61 billion in spending cuts.
The cost of keeping the government's lights off

They have called for a short-term extension of federal spending so the parties can negotiate, but at current spending levels.

'Common sense cuts'
Cantor said the $4 billion they want to trim from the current budget over a two-week period would come from eliminating some of the earmarks or special projects already in the budget and accelerating spending cuts that President Barack Obama has proposed for fiscal year 2012 starting in October.

If Senate Democrats walk away from that offer, said Illinois Republican Peter Roskam, "they are then actively engineering a government shutdown." More

wandeljw - I'm not a gov employee. I'm a contractor still. That said, it wouldn't make a difference. On my site, the government employees will have to show up for work even if the government shuts down. That's how things go in defense. Same goes for my roommate. He works for the NRC. He'll have to work and won't get paid. Furlow isn't a option for some jobs. Republican or Democrat, this will raise hell in Washington.

I'd say about a quarter of my friends here are Federal employees. Most of them are pretty much watching the minute hand waiting for this to happen.

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