Obama Hosts House Dems As GOP Debt And Spending Plan Falls Apart

The president hosted Democratic congressional leaders Tuesday afternoon to discuss the ongoing government shut down and threat that the U.S. could breach the debt ceiling. Earlier in the day, a House GOP plan to end the dual crisis fell apart.

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ROBERT SIEGEL, HOST:

From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.

The nation's fiscal crisis is back in the hands of the Senate. The top Democrat and Republican there reopened talks this evening - talks aimed at ending a 15-day old government shutdown and at preventing a costly federal default. Those bipartisan talks in the Senate had been on hold for most of the day, while Republicans in the House tried to craft their own plan. That effort collapsed late in the say when it became clear that conservatives in the House would not go along.

NPR's Scott Horsley joins us now from the White House. Scott, welcome, toward the end of what has been an awfully confusing day. Twenty four hours ago, it looked as if the Senate was close to a deal. What happened?

SCOTT HORSLEY, BYLINE: Well, those House Republicans reared their head. They had been on the sideline since the weekend, when the House Speaker John Boehner threw up his hands - not for the first time - and said he couldn't come to a deal with President Obama. And so that left it to the senators, Harry Reid and Mitch McConnell, to try to negotiate an agreement. And they seemed to be making a lot of headway towards that.

But the deal they were fashioning was pretty much free of the kinds of partisan strings that the most conservative House Republicans were demanding, and so those House Republicans said, hold on, wait a minute. The problem is we don't have that many minutes left to wait. We're now less than two days from the federal government running out of borrowing capacity, and maybe a few days after that before we're staring at a government default.

So this 11th-hour delay by the House Republicans was very frustrating to Democrats. Steny Hoyer, the number two Democrat in the House, accused Republicans of undermining Americans' confidence.

REPRESENTATIVE STENY HOYER: In effect, what they've done is to snatch confrontation from the jaws of reasonable agreement.

HORSLEY: And President Obama, who met with House Democrats this afternoon, shares that frustration.

SIEGEL: Well, if the House Republicans were playing such an important role today, what is it that they're asking for?

HORSLEY: Well, part of the problem is they don't seem to be sure themselves. We saw a couple of drafts from the House speaker today that include some modest changes to the President's health care law, but it was a moving target.

And twice today John Boehner appeared close to putting out a plan, only to pull it back when he couldn't get enough support from his own members, and that drew an angry retort from the leader of House Democrats, Nancy Pelosi.

REPRESENTATIVE NANCY PELOSI: What you saw here was a speaker who did not have the votes for his proposal. So why are they doing this to the American people, sabotaging a good-faith bipartisan effort coming out of the Senate, wasting the public's time? And in this case, time is money.

HORSLEY: Time is money here. The stock market tumbled more than 130 points on this delay today. And this evening, the Fitch bond rating service put out a warning, which is really just a statement of the obvious. It said while it still expects Congress to raise the debt limit, the delay could increase the risk of a government default.

SIEGEL: Okay, so the House Republicans could not come up with a plan that they would agree on and so there's no vote tonight in the House. What happens now?

HORSLEY: As you say, we're back to the Senate. Harry Reid and Mitch McConnell have restarted their talks, which they suspended all day to give the Republican House speaker a chance. And they seem to have picked up right where they left off. The two leaders say they're confident they can make a deal in time to prevent a default, even if precious hours have now been wasted.

Even as she was criticizing Speaker Boehner this afternoon, Nancy Pelosi suggested maybe there's a method to all this. Maybe he's just trying to give his members a chance to sow their oats. But oats or no oats, the House Republicans show no signs of settling down and we're running short on time here.

SIEGEL: Okay, let's say that Harry Reid and Mitch McConnell manage to arrive at a deal that has a majority and is approved, therefore, by the Senate. It would go to the House. Is it clear that it would pass?

HORSLEY: Well, at that point, we'd be back to John Boehner trying to win passage with mostly Democratic support, which would be a bitter pill to swallow, but perhaps a bit easier if we're right up against the buzzer on the Thursday debt limit.

SIEGEL: OK. That's NPR's Scott Horsley at the White House. Thank you, Scott.

HORSLEY: My pleasure.

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