Congress Braces for Looming Fiscal Fight

Congress will once again address two of its most elusive and daunting fiscal challenges in the coming weeks: funding the government and increasing the debt limit.

The top four leaders of the House and Senate met today behind closed doors to initiate discussions on each debate, both of which will indisputably require a bipartisan agreement from the bitterly divided Congress.

First up is the continuing resolution. The federal government is funded through Sept. 30 but because neither the House nor Senate has passed all 12 of their appropriations bills, the government would shut down without a stop-gap measure from Congress.

House Republicans floated a proposal earlier this week that would have funded the government through mid-December, but their most conservative members opposed a plan leadership had devised that aimed to force the Senate to hold a vote to defund the Affordable Care Act. Instead, those Republicans demand that the House Republican leadership put forward legislation that completely defunds Obamacare within the underlying legislation, separate from any gimmicks or parliamentary tricks.

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Without the votes to pass the leadership's gambit, House Speaker John Boehner pulled the legislation from the House floor Wednesday. He said today he might still work to find the votes for that scheme, but he conceded that "there are a million options that are being discussed" for a continuing resolution.

"There's all this speculation about these deadlines that are coming up. I'm well aware of the deadlines. So are my colleagues," Boehner, R-Ohio, said. "We're working with our colleagues to work our way through these issues. I think there is a way to get there. I'm going to be continuing to work with my fellow leaders and our members to address those concerns."

About an hour earlier, Boehner had hosted Senate Majority Leader Harry Reid, Senate Republican Leader Mitch McConnell and House Democratic Leader Nancy Pelosi for a 45-minute meeting in the Speaker's office at the Capitol.

Afterwards, Democrats claimed they were candid with Republicans, telling Boehner and McConnell to forget red-meat proposals that are unlikely to draw much Democratic support.

"They know that what they're proposing is not going to pass the Senate or be signed by the president, so why don't we just save time, be constructive?" Pelosi, D-Calif., said during a news conference this afternoon. "Just because you're an anti-government ideologue who has landed in Congress doesn't mean that you should be shutting down government."

Reid said he was also direct with Boehner, urging him to focus on crafting an agreeable continuing resolution instead of caving to demands by conservatives to defund Obamacare.

"As we all know, the Speaker has a problem: how to get the government funded," Reid, D-Nev., said. "I told him very directly that all these things they're trying to do on the 'Obamacare' is just a waste of their time."

Reid also contended that a faction of House Republicans is intent on shutting down the government if their effort to defund the president's health care plan fails to gain traction.

"Shutting down the government obviously is what a majority of the Republican caucus wants to in the House," Reid said. "Those in touch with reality, and most everyone is in touch with reality, should understand that passing a clean CR is the right thing to do.

"Let's stop these really juvenile political games," he added

On top of the continuing resolution, the Treasury Department has notified Congress that the debt limit, which works like the nation's credit card, will need to be increased sometime in October.

Boehner told reporters that he had the same message for Reid and Pelosi as he did for Treasury Secretary Jack Lew in a meeting Wednesday: Presidents Reagan, Bush, Clinton and Obama "have used the debt limit to find bipartisan solutions on the deficit and the debt."

"President Obama is going to have to deal with this as well. It's really no different," Boehner said. "You can't talk about increasing the debt limit unless you're willing to make changes and reforms that begin to solve the spending problem that Washington has.

"We're all living a longer, drawing more Medicare, more Social Security. The system has to be addressed," he added. "These programs are important to tens of millions of Americans. They're not going to be there if we don't begin to solve these problems."

Pelosi, on the other hand, told reporters she prefers a Democratic proposal to replace next year's sequestration cuts, totaling about $100 billion, with new tax revenue achieved by cutting farm subsidies and slashing tax breaks for big oil and gas companies.

"It reduces the deficit in a balanced way," she said. "You have to make judgments, and when you make a judgment that you're going to, for example, throw kids out of Head Start, you're not saving any money."

McConnell reiterated his "long-held position" that tax increases are not an option for dealing with the country's spending problem, according to a senior GOP leadership aide. The aide said McConnell reminded Reid and Pelosi of the $16 trillion national debt and pointed out an annual federal deficit that grows by hundreds of billions of dollars a year.

"We need to start by keeping the cuts we've already agreed to," McConnell, R-Ky., wrote in a statement after the meeting. "It's time to get serious about the challenges we face and reposition America for growth and prosperity in the 21st century."