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Democrats reject proposed US House fiscal plan Democrats reject proposed US House fiscal plan
(about 3 hours later)
US Democrats have rejected a proposal from House of Representatives Republicans to extend the debt limit and reopen the federal government.US Democrats have rejected a proposal from House of Representatives Republicans to extend the debt limit and reopen the federal government.
The White House criticised what it called an attempt to appease a small group of conservatives, but praised a parallel bipartisan Senate plan.The White House criticised what it called an attempt to appease a small group of conservatives, but praised a parallel bipartisan Senate plan.
The White House objected to the House's proposed alterations to President Barack Obama's "Obamacare" health law. The White House balked at the House's proposed amendments to President Barack Obama's signature healthcare law.
The US must raise its $16.7tn (£10.5tn) debt limit by Thursday or risk default.The US must raise its $16.7tn (£10.5tn) debt limit by Thursday or risk default.
Parallel proposals It remains unclear whether Congress can agree a deal in time to avert the economic calamity in the US and across the world that economists say could result.
It remains unclear whether Congress can agree a deal in time to avert widely feared economic calamity in the US and across the world. 'Ransom' demand
Both the Senate plan, outlined on Monday evening, and the House Republicans' plan, revealed on Tuesday, would fund the government through mid-January and raise the debt ceiling until February, creating room for negotiators to agree a longer-term budget.Both the Senate plan, outlined on Monday evening, and the House Republicans' plan, revealed on Tuesday, would fund the government through mid-January and raise the debt ceiling until February, creating room for negotiators to agree a longer-term budget.
The Senate proposal would delay for two years a per-employee tax paid by companies and labour unions on workers' healthcare plans.The Senate proposal would delay for two years a per-employee tax paid by companies and labour unions on workers' healthcare plans.
The House plan, meanwhile, would delay a medical device tax used to pay for healthcare subsidies under the law and eliminate healthcare subsidies for the president, vice-president, members of the president's cabinet, and members of Congress.The House plan, meanwhile, would delay a medical device tax used to pay for healthcare subsidies under the law and eliminate healthcare subsidies for the president, vice-president, members of the president's cabinet, and members of Congress.
Both proposals would include income verification requirements for Americans seeking public subsidies to purchase health insurance.Both proposals would include income verification requirements for Americans seeking public subsidies to purchase health insurance.
The health law passed in 2010, was subsequently validated by the Supreme Court, and was a central issue in the 2012 presidential election, which Mr Obama won handily. Many key provisions have already taken effect, and more begin next year.The health law passed in 2010, was subsequently validated by the Supreme Court, and was a central issue in the 2012 presidential election, which Mr Obama won handily. Many key provisions have already taken effect, and more begin next year.
On Tuesday, Mr Obama rejected what an aide described as Republicans' attempt to extort "ransom" while the government remained shut and the threat of a debt default loomed.On Tuesday, Mr Obama rejected what an aide described as Republicans' attempt to extort "ransom" while the government remained shut and the threat of a debt default loomed.
Call for 'fairness'
"Unfortunately, the latest proposal from House Republicans does just that in a partisan attempt to appease a small group of Tea Party Republicans who forced the government shutdown in the first place," said White House spokeswoman Amy Brundage, referring to a faction of hardline conservatives who hold significant sway in the House."Unfortunately, the latest proposal from House Republicans does just that in a partisan attempt to appease a small group of Tea Party Republicans who forced the government shutdown in the first place," said White House spokeswoman Amy Brundage, referring to a faction of hardline conservatives who hold significant sway in the House.
"Democrats and Republicans in the Senate have been working in a bipartisan, good-faith effort to end the manufactured crises that have already harmed American families and business owners. With only a couple days remaining until the United States exhausts its borrowing authority, it's time for the House to do the same."
Later, Republican House Speaker John Boehner said that both parties were trying to find a way forward and that the House plan was focused on "fairness for the American people under Obamacare".Later, Republican House Speaker John Boehner said that both parties were trying to find a way forward and that the House plan was focused on "fairness for the American people under Obamacare".
"There have been no decisions about exactly what we will do," he told reporters on Tuesday. "There are a lot of opinions about what direction to go.""There have been no decisions about exactly what we will do," he told reporters on Tuesday. "There are a lot of opinions about what direction to go."
House and Senate Democrats immediately joined Mr Obama is denouncing the House Republican plan. But following a meeting with Mr Boehner and GOP moderates on Tuesday Republican representative Charlie Dent told the media his "best estimate is that there aren't the votes to pass it".
Senate Majority Leader Harry Reid said the plan was "an extreme piece of legislation and it's nothing more than a blatant attack on bipartisanship." He said it would never pass the Democratic-controlled Senate. House and Senate Democrats immediately joined Mr Obama in denouncing the House Republican proposal.
Democratic House Minority Leader Nancy Pelosi, meanwhile, suggested Mr Boehner's plan failed even to attract sufficient votes from his fellow Republicans to pass. Senate Majority Leader Harry Reid said the plan was "an extreme piece of legislation and it's nothing more than a blatant attack on bipartisanship". He said it would never pass the Democratic-controlled Senate.
She said the "great progress" made on the proposed Senate bill "struck fear in the hearts of House Republicans" and led them to "sabotage the bipartisan effort" in the Senate. Mr Obama is scheduled to meet House Democrats on Tuesday afternoon as the clock ticks to Thursday's debt ceiling deadline.
Mr Obama is scheduled to meet House Democrats on Tuesday afternoon as Thursday's debt ceiling deadline inches ever closer.
'Surrender caucus''Surrender caucus'
Even if a deal is reached in the Senate, it is unclear whether Congress could act in time to pass legislation that would avert the 17 October default deadline.Even if a deal is reached in the Senate, it is unclear whether Congress could act in time to pass legislation that would avert the 17 October default deadline.
Hardline conservatives such as Texas Republican Ted Cruz could use Senate rules to stonewall a vote.Hardline conservatives such as Texas Republican Ted Cruz could use Senate rules to stonewall a vote.
In the House of Representatives, the Senate deal could meet fierce resistance from the Tea Party-aligned Republicans.In the House of Representatives, the Senate deal could meet fierce resistance from the Tea Party-aligned Republicans.
One of those conservative hardliners, Kansas Representative Tim Huelskamp, was quoted by the New York Times as labelling his upper chamber colleagues "the Senate surrender caucus".One of those conservative hardliners, Kansas Representative Tim Huelskamp, was quoted by the New York Times as labelling his upper chamber colleagues "the Senate surrender caucus".
"Anybody who would vote for that [Senate deal] in the House as Republican would virtually guarantee a primary challenger," he said."Anybody who would vote for that [Senate deal] in the House as Republican would virtually guarantee a primary challenger," he said.
Republicans have taken the brunt of blame for the latest fiscal cliffhanger to cripple Capitol Hill, according to opinion polls.Republicans have taken the brunt of blame for the latest fiscal cliffhanger to cripple Capitol Hill, according to opinion polls.
A Washington Post/ABC News survey on Monday found 74% of voters were unhappy with congressional Republicans' handling of the standoff, compared with a 53% disapproval rating for President Obama.A Washington Post/ABC News survey on Monday found 74% of voters were unhappy with congressional Republicans' handling of the standoff, compared with a 53% disapproval rating for President Obama.
Some in the party have voiced concern that the affair could damage its prospects in next year's midterm elections.Some in the party have voiced concern that the affair could damage its prospects in next year's midterm elections.
Economists and bankers have warned for weeks of dire consequences should Congress fail to reach an agreement on raising the nation's debt ceiling. The US Treasury has been using what are known as "extraordinary measures" to pay its bills since the nation reached its current debt limit in May. Those methods will be exhausted by 17 October, it has said.
The US Treasury has been using what are known as "extraordinary measures" to pay its bills since the nation reached its current debt limit in May.
Those methods will be exhausted by 17 October, US Treasury Secretary Jack Lew has said.
Meanwhile, the government remains partially shut down because Congress failed to agree on funding by a 1 October deadline.Meanwhile, the government remains partially shut down because Congress failed to agree on funding by a 1 October deadline.
The impasse has closed a swathe of federal services and left hundreds of thousands of employees out of work.The impasse has closed a swathe of federal services and left hundreds of thousands of employees out of work.