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US no closer to deals on debt and shutdown

Republicans and Democrats fail to reach compromise on government shutdown and raising country's debt ceiling.

Last Modified: 13 Oct 2013 00:38
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US House Democrats line up to march to the House floor to address the government shutdown [Reuters]

Talks among United States politicians have failed to agree to end a partial government shutdown and raise the country's debt ceiling as a deadline looms ever closer.

A Saturday meeting between the Senate Majority Leader, Harry Reid, a Democrat, and the Senate Republican leader, Mitch McConnell, failed to agree measures to raise the country's debt ceiling, which means the country could default on its debts after current legislation runs out on Thursday, sending the world economy into turmoil.

The Senate is due to meet on Sunday, but the House of Representatives is not, meaning Congress will have very little time to reach agreement

"Economists say it won't be long before financial markets react negatively to this continued uncertainty," Reid said on the Senate floor. "The life savings of ordinary Americans are at risk."

Among the unresolved issues is the duration of the debt ceiling increase.

Time limits

House Republicans were pushing for a law that would cover only six weeks, producing another potential showdown in the middle of the Christmas period. Democrats want to push the next debt ceiling deadline at least well into the new year.

There is also still no agreement on law for a new budget, which would end a partial shutdown of government and the temporary layoffs of about 800,000 state workers.

The other issue, the government shutdown, was sparked after the Republican-led house refused to agree a new budget law, insisting it should be tied to the defunding of President Barack Obama's signature healthcare plan.

Dick Durbin, the second-ranking Democrat in the Senate, said the goal was to reach a bipartisan deal in the Senate before financial markets reopen on Monday.

With every passing day, according to opinion polls, Americans' patience has worn thin with Republican tactics that led to the government shutdown, enhancing prospects of a deal.

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Source:
Reuters
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