Washington Wakes Up From A National Nightmare

By MICHAEL FALCONE ( @michaelpfalcone )


  • 'A LOT OF WORK AHEAD': President Obama signed a bill shortly after midnight that ended a 16-day government shutdown after the Senate and House approved budget legislation and extend the debt limit, ABC's ABBY PHILLIP reports. With the president's signature, federal employees are expected to return to work today, Office of Management and Budget Director Sylvia Mathews Burwell said in a statement Wednesday night. "There's a lot of work ahead of us, including the need to earn back the trust of the American people that has been lost of the last few weeks," Obama said in the White House briefing room just minutes after the Senate voted to approve the compromise legislation. The president did not take questions, but slipped a brief answer to one shouted at him by a reporter about whether the country would face another standoff over funding the government and raising the debt limit in a few months. "No," Obama said as he walked back into the West Wing. http://abcn.ws/H2xjh3
  • HAPPENING TODAY: At 10:35 a.m. President Obama plans to deliver a statement on the agreement to re-open government and avert default from the State Dining Room.
  • THE VOTE: Last night the Senate approved the compromise proposal to fund the government until Jan. 15 and extend the debt limit until Feb. 7 with 81 senators voting in favor of the measure and 18 - all Republican Senators - voting against it. The House followed suit shortly afterward, voting 285 to 144 to approve the bill. One hundred and forty-four Republicans opposed it. Eighty-seven other Republicans joined all 198 Democrats casting votes in favor of the measure. The compromise was completed by Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., after a House effort to offer a counter-proposal nearly derailed Senate negotiations on Tuesday. http://abcn.ws/H2xjh3
  • THE DETAILS: The final agreement makes only minor changes to President Obama's health care law by requiring income verification for people receiving health care subsidies from the government. It also authorizes a bipartisan committee of negotiators to hammer out a long-term budget deal by Dec. 13, before government funding runs out again in January.


ABC's JEFF ZELENY: For all the changes to the old order of Washington, for all the defiance from a new wave of Republicans carrying the spirit of Tea Party activists, one thing hasn't changed in the Capitol: The Senate still gets its way. House Republicans got rolled, so does that mean Speaker John Boehner is heading home to Ohio this weekend as a deeply wounded man? Not quite. While he won't be listed high atop the roster of winners in this Washington debacle, he's also far from the biggest loser. He has the support of some House Republicans who didn't much like him less than a year ago. When I asked Rep. Michele Bachmann yesterday about the speaker, she beamed and said she was "very proud of John Boehner for his wonderful job holding us together." A similar sentiment from Rep. Raul Labrador, who has been a Boehner critic: "I think he has done a terrific job over the last two and a half weeks." And that's just fine with the White House and the both sides of Senate leaders, who prefer Boehner far more than any alternative.

ABC's RICK KLEIN: In the inevitable lists of winners and losers that grew out of this fight, House Speaker John Boehner is a pretty consistent loser. But should he be? Consider the fact that he was warning from the start that this fight wasn't worth it. Consider that he had to manage a tea party group that insisted on 'no' give, and a moderate bunch that wanted to end it on Democrats' terms within days of the shutdown's start. And consider, most astonishingly, that he emerged from this with no serious calls for his head. Rep. Raul Labrador says he's "proud" of Boehner; Rep. Mick Mulvaney says he's "100 percent stronger" now; Rep. Michele Bachmann at one point said he's done an "incredible job." It's not fair to compare Boehner to strong speakers of bygone eras. Here's a guy who played a losing hand the way his conference wanted it played. Republicans have just about nothing to show for this fight, but at least they had a touch of voting unity for most of the fight - and that's thanks to Boehner.

ABC's DEVIN DWYER: Now that an exhausting, and disgusting, round of political brinkmanship has passed, here's today's burning question: Are we going to go through this all over again in just a few months? Our political leaders are sounding hopeful notes that it won't. But the grim reality is that there's virtually no concrete evidence that the underlying causes of the latest crisis have been resolved. On Wednesday night, President Obama answered a confident but curt, "no," when asked by reporters whether we're bound for a repeat in mid-January and early February. Then again, he also predicted in 2012 that the "fever" of GOP obstructionism would be "broken" by his re-election. So much for that.

ABC's SHUSHANNAH WALSHE: Sarah Palin may have lost two fights last night, but she is telling her supporters to "be energized" and "we've only just begun to fight." She backed Steve Lonegan in the New Jersey special senate election yesterday, but Newark mayor Cory Booker prevailed, as well as the efforts to defund Obamacare that led to the government shutdown and debt ceiling standoff. But, what's most interesting about a Facebook message she released late night is that she seems to be suggesting she may be backing conservative challengers in high profile primary races next year. "Friends, do not be discouraged by the shenanigans of D.C.'s permanent political class today," Palin wrote. "Be energized. We're going to shake things up in 2014. Rest well tonight, for soon we must focus on important House and Senate races. Let's start with Kentucky - which happens to be awfully close to South Carolina, Tennessee, and Mississippi - from sea to shining sea we will not give up. We've only just begun to fight." In Kentucky, Senate Minority Leader Mitch McConnell is being challenged by businessman and tea partier Matt Bevin. In South Carolina, Sen. Lindsey Graham has two tea party challengers. She also mentions Mississippi and Tennessee, where there also lesser known challengers. Sen. Thad Cochran gets a conservative challenger in Mississippi today. Mississippi state Sen. Chris McDaniel will announce in Ellisville, MS while Sen. Lamar Alexander got a challenger, state Rep. Joe Carr, earlier this month. It's a clear sign that no matter what the former Alaska governor meant, the 16 day standoff and last night's vote will mean 2014 challengers from both sides of the aisle.




1. Federal Government Back in Business on Thursday: With President Obama's signature now on the bill, the wheels of government will begin turning again, albeit slowly. Roughly 450,000 presently furloughed federal workers will be expected back on the job Thursday, or their next regularly scheduled work day. "Employees should expect to return to work in the morning," OMB director Sylvia Mathews Burwell said in a statement late Wednesday night. Notice to federal workers was expected to be posted online, sent out by email and, in some cases, delivered by robo-call. The Office of Personnel Management says some leeway may be given to employees who might not be ready to get back on the job so abruptly.

2. Back Pay on the Way: The deal sets into motion re-payment of all "essential" federal workers - from the White House cook to Capitol Police officers and CDC scientists - who have been working the past 16 days without any income. It will also send forgone wages to the 800,000 furloughed federal workers who spent time sitting at home.

3. Start a New Countdown Clock! Shutdown, Default Still on Horizon: The deal does nothing to resolve the bitter, underlying partisan differences on Obamacare, entitlements, taxes or spending that precipitated this mess in the first place. The House and Senate are required to appoint budget negotiators and come up with a sweeping agreement by Dec. 13 - but nothing happens if they don't get there. If the track record of past "super-committees" is any indication, there's not a lot of reason for hope that this will be successful. The party differences could easily lead to another impasse, government shutdown and countdown to default in just a matter of weeks. Government funding will run out on Jan. 15, 2014, under this deal. The debt ceiling is extended to Feb. 7, 2014.

4. Affordable Care Act Largely Unscathed: Not Defunded, Delayed or Substantively Changed: Republicans failed to extract any major concessions from Democrats and President Obama on changes to the Affordable Care Act. Attempts to strip the law of all funding, to delay the entire law, to delay just the individual mandate or to delay the medical device tax, among other changes, all fizzled. The one thing the deal would change about the Affordable Care Act is that it would nominally strengthen anti-fraud protection for government subsidies in the new health insurance marketplace. Republicans have been concerned that existing protections are insufficient, relying on a consumer's self-reported income and randomizing compliance checks to enforce a limit on subsidies to only those earning more than 400 times the federal poverty level. Under the deal, the HHS secretary reportedly would be required to personally certify that proper income verification tools were in place and mandate an independent audit from the inspector general.


ANALYSIS: WHAT JUST HAPPENED IN WASHINGTON? It has been called the shutdown about nothing. In bringing it to an end, lawmakers managed to accomplish even less than that, ABC's RICK KLEIN writes. There's a temptation, after Washington moves away from the latest in its seemingly endless lines of confrontations, to celebrate the moment. Words like "bipartisan" and "compromise" are bandied about. Senate Majority Leader Harry Reid quickly labeled the agreement "historic." There's a reflexive desire to declare that, for all the sausage-making, the system worked. Except that it didn't, not even a little bit. This was a moment when Washington simply broke, or, at the very least, showed the world how hopelessly and totally broken it has become. As a result of the agreement reached Wednesday, nearly three weeks of sheer madness have come to an end. That's about it. A government that nobody wanted to shut down is poised to reopen after 16 days of personal hardship, disappointed tourists and vast amounts of wasted productivity. The United States was on the brink of defaulting on its debts because of simple legislative paralysis; the best that can be said of a higher debt limit is that this won't happen, at least for now. Beyond that, not a single law or government policy is changing in even a small way. If you're looking for vast changes to the new Obama health care law, keep looking and, eventually, you'll find that if you qualify for a health care subsidy, the government will now seek to verify your income. Actually, the compromise reached Wednesday seems likely to make future confrontations - and they'll be back soon enough - even worse. The long-term budget challenges surrounding entitlement spending and an aging population are again being pushed toward a future, nebulous time, while they only grow more acute. http://abcn.ws/1aO5WQ2

HOW MUCH THE GOVERNMENT SHUTDOWN COST US. The 16-day government shutdown is over, but the country has taken at least a $24 billion hit along the way, according to the financial ratings agency Standard & Poor's. That equals about $1.5 billion dollars a day and Standard & Poor's estimated the shutdown also "shaved at least 0.6 percent off annualized fourth-quarter 2013 GDP growth," ABC's SHUSHANNAH WALSHE reports. These estimates are for the overall economy, taking into account not just federal wages and productivity, but all the ripple effects and costs as well. "The bottom line is the government shutdown has hurt the U.S. economy," Standard & Poor's said in a statement. "In September, we expected 3 percent annualized growth in the fourth quarter because we thought politicians would have learned from 2011 and taken steps to avoid things like a government shutdown and the possibility of a sovereign default. Since our forecast didn't hold, we now have to lower our fourth-quarter growth estimate to closer to 2 percent." Moody's Analytics reported a similar number Wednesday, saying by the end of the day the shutdown will cause a $23 billion hit to U.S. GDP or $1.4375 billion per day. And that's not all. Here's ABC's look at the costs of the shutdown: http://abcn.ws/18nKAuc

THE CURIOUS CASE OF THE HOUSE STENOGRAPHER. A House stenographer was pulled out of the House chamber while shouting into the microphone during Wednesday's vote on a compromise bill to end the government shutdown and raise the debt limit, ABC's ABBY PHILLIP and JOHN PARKINSON note. The woman was Dianne Reidy, an official reporter with the Office of the Clerk, two sources told ABC News. She was heard shouting "the House is divided," according to one source. She was pulled off the rostrum by chamber security staff. "He will not be mocked," the woman said, according to an audio recording of the incident posted online by Public Radio International reporter Todd Zwillich. "This is not one nation under God. It never was." "The greatest deception here is this is not one nation under god! It never was. Had it been, it would not have been! The Constitution would not have been written by Freemasons!" she added. The incident caused a moment of chaos in the chamber as the presiding member, Rep. Ileana Ros Lehtinen, R-Fla., repeatedly banged the gavel, trying to restore order. http://abcn.ws/19T7jk6

$174,000 TO A SENATOR'S WIDOW AND OTHER SURPRISES IN THE FISCAL COMPROMISE BILL. There are some interesting nuggets inserted into the bill that re-opened the government and averted a default, ABC's RICK KLEIN, MICHAEL FALCONE, ARLETTE SAENZ and DEVIN DWYER note. As pork goes, these are low-level on the outrage scale, such as a death benefit for Sen. Frank Lautenberg's widow - a line item buried on page 20 of the 35-page bill: "Notwithstanding any other provision of this joint resolution, there is appropriated for payment to Bonnie Englebardt Lautenberg, widow of Frank R. Lautenberg, late a Senator from New Jersey, $174,000." That provision approves money for a death benefit accorded to senators and its common practice. Another section of the bill hikes funding for projects along the Ohio River, portions of which flow through Illinois and Kentucky, states represented by Sen. Dick Durbin, D-Ill., and Senate Minority Leader Mitch McConnell, R-Ky. The bill boosts money for the projects by $2.1 billion, from an original $775 million to $2.9 billion. Senate Majority Leader Harry Reid, D-Nev., defended the Ohio River dam project, saying the project will actually save taxpayers money. "This is not an earmark. It saves the taxpayers lots of money and enables the Corps of Engineers to continue a project," Reid told reporters at a news conference Wednesday night. These items were tucked into the all-important piece of legislation with just about no chance for public review. http://abcn.ws/18ns8lr

CAROLINE KENNEDY QUIETLY CONFIRMED AS AMBASSADOR TO JAPAN. Shortly after the Senate voted in favor of a bipartisan fiscal deal to reopen the government and avert a default, Caroline Kennedy was confirmed as the next U.S. ambassador to Japan, according to ABC's ARLETTE SAENZ. The Senate confirmed Kennedy by unanimous consent, making her the first female U.S. ambassador to Japan in U.S. history. President Obama nominated Kennedy, a 55-year-old author and attorney, to the diplomatic post in July. Kennedy gave Obama's presidential campaign a major boost when she endorsed the Illinois senator in the 2008 presidential campaign. Kennedy was once considered a leading contender for Hillary Clinton's Senate seat when Clinton became secretary of state. Kennedy ultimately withdrew from consideration, citing a "private family matter." http://abcn.ws/1hXN3Nn

DEMOCRATS ACCUSE REPUBLICANS OF 'MCCARTHY-ERA' TACTICS IN NATIONAL PARKS INQUIRY. The government shutdown hand't even ended yet, but a group of Congressional Republicans, who polls show have received the lion's share of the blame for the two-week fiscal standoff, spent part of Wednesday accusing the Obama administration and National Park Service officials of "decision making based on politics rather than prudence." As lawmakers prepared to vote on a deal to end the government shutdown and raise the debt ceiling in order to prevent a U.S. default, members of both the House Oversight and Natural Resources Committee, led by Reps. Darrell Issa (R-Calif.) and Doc Hastings (R-Wash.), held a joint hearing to investigate the closing of national parks and memorials, which quickly became some of the most visible symbols of the shutdown, ABC's ALEX LAZAR reports. Sparks flew at the contentious hearing in which Republicans blamed the National Park Service for unnecessarily using additional personnel to close down notable landmarks, including the World War II Memorial. Democrats on the committees, including Oversight Committee ranking member Elijah Cummings (D-Md.), expressed exasperation that their Republican colleagues decided to hold the hearing in the first place. "Do you know what really honors our nation's heroes for their service and for their sacrifice?" Cummings asked. "Providing them with the benefits they earned after suffering injuries in combat. Paying them the pensions they need to cover their rent, their utility bills, their food and guaranteeing the assistance they rely on to stay off the streets and, in some cases, to simply stay alive." http://abcn.ws/19RjI6a

HILLARY AND BILL CLINTON RAKE IN CASH FOR TERRY MCAULLIFE AT FEVERISH PACE. If she sticks to her schedule, by the end of October Hillary Clinton will have appeared at five separate events for Virginia gubernatorial candidate Terry McAuliffe over the course of a month, and former President Bill Clinton is not far behind her, ABC's ANNETA KONSTANTINIDES notes. McAuliffe is a former Democratic National Committee chairman who served as chairman of Bill Clinton's 1996 presidential campaign, and of Hillary Clinton's unsuccessful 2008 White House bid. Clinton kicked off fundraising efforts for her longtime pal Tuesday night in New York with a $25,000 per couple private reception, according to a report in Politico. This Saturday, she plans to publicly endorse McAuliffe, who is running against Republican State Attorney General Ken Cuccinelli, at a "Women for Terry" event followed by a fundraising reception the same night in the well-to-do enclave of McLean, Va. And the former secretary of state is taking her fundraising prowess on the road: She caps off the month as the marquee name at a Hollywood luncheon on McAuliffe's behalf hosted by media tycoon Haim Saban and wife Cheryl, on Oct. 30. According to the Los Angeles Times, which obtained a copy of the invitation, individual tickets cost $15,000 and for couples, $25,000. Director Steven Spielberg and DreamWorks Animation CEO Jeffrey Katzenberg are co-hosts. http://abcn.ws/1cW1L9T


CORY BOOKER WINS RACE FOR US SENATE SEAT IN NEW JERSEY. After a sped-up race for U.S. Senate, Newark Mayor Cory Booker, a Democrat, beat Republican Steve Lonegan, a tea party conservative and former mayor of Bogota, N.J., last night. With 99.3 percent of precincts reporting, Booker beat Lonegan 54 percent to 44 percent. Booker prevailed after an unusual four-month race to fill the Senate seat vacated by the death of Sen. Frank Lautenberg, a fellow Democrat, in June, ABC's SHUSHANNAH WALSHE writes. Booker, 44, will serve out the last 15 months of Lautenberg's term, and will need to run in 2014 for a chance at serving a full six-year term beyond that. Booker led Lonegan, 57, by more than 30 points as recently as September, but a Monmouth University poll released this week showed a gap narrowed to 10 points. John Weingart, the associate director of the Eagleton Institute of Politics at Rutgers University, told ABC News, "Cory Booker has followed a very unlikely path to be a national celebrity and rising political star." Booker is not only the first African-American U.S. senator from New Jersey, he is the first African-American to be nominated by a major party for a statewide office in New Jersey. http://abcn.ws/17uQLZQ


@daveweigel: What the GOP should have figured out earlier: Safely-reelected Obama had no reason to cave and fully expected to break them.

@DanaPerino: The RNC set to announce the location of the next GOP convention…abandoned phone booth. Should be plenty of meeting space in there.

@TonyFratto: So the most likely outcome of fiscal talks is to not move - CRs forever.

@SusanPage: In Washington, the federal government reopens-but it still lives in the District of Dysfunction. Winners/losers: http://usat.ly/1glfzwJ

@joshtpm: There r so many comical little gems in this NYT piece by Jenn Steinhauer abt the end of the shutdown debacle http://www.nytimes.com/2013/10/17/us/hands-empty-but-spirit-unbowed-house-republicans-take-stock.html?hp&_r=0 …

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