Congress Hits Budget Impasse As Deadline Nears

Just a week away from a possible government shutdown, lawmakers boxed themselves into a new budget impasse Friday.

With Congress' approval ratings already at an all-time low, a tit-for-tat over disaster aid left Republicans and Democrats - and the House and Senate - in a faceoff that's all too familiar to millions of Americans. Deep partisan disputes pushed the government to the edge of a partial shutdown in April, and to the brink of a debt ceiling crisis in late July.

On Friday, the Democratic-controlled Senate blocked a Republican House bill that would provide stopgap federal spending, plus aid for people battered by hurricanes, tornadoes and other natural disasters. The legislation also calls for $1.6 billion in spending cuts to help defray the disaster costs.

Democrats say it's unprecedented and unfair to require spending cuts to accompany badly needed emergency aid. They are especially unhappy that the GOP measure would tap clean-energy programs credited with creating jobs.

Republicans say that with a $14 trillion-plus national debt, business-as-usual spending is no longer acceptable.

With elections coming, congressional Republicans suggest voters will find it outrageous that Democrats wouldn't accept a mere $1.6 billion in spending cuts. Democrats are betting voters will find it petty and manipulative to let tornado and hurricane victims wonder if federal aid will be denied because lawmakers want to cut aid to automakers.

The parties' feuding earlier this year prompted a rating agency to downgrade the government's credit-worthiness, which sent shock waves through financial markets. Legislation finally did make it to passage to raise the debt limit and stave off potential default.

This time, it's possible that Congress will find a last-minute way to avoid a shutdown of many federal agencies when the fiscal year ends next Friday. The Senate plans to vote Monday on a Democratic bill that would not require spending offsets to release new money for the Federal Emergency Management Agency. FEMA, drained by several severe storms, could run by next week, officials said.

In the Senate, however, GOP leader Mitch McConnell of Kentucky is confident Republicans will block the Democrats' counter-move with a filibuster. It takes 41 votes to sustain a filibuster in the 100-member Senate, and the Republicans hold 47 seats.

If the GOP succeeds, the Senate could accept the House Republican bill it rejected on Friday. Or legislative leaders could try to negotiate their way past the logjam. Congress was not scheduled to be in session next week, and House leaders said they don't plan to call their members back to Washington.

The governors of four hurricane-damaged East Coast states - including the Republican governors of New Jersey and Pennsylvania - said in a statement that "federal assistance for the victims of storms and floods should be beyond politics."

If the disaster relief agency runs out of money, the most immediate hardships could be felt by storm victims who need assistance checks to continue stays in motels and other temporary housing. Disaster victims could also face delayed aid for crucial repairs of house and structural damage, said FEMA spokeswoman Rachel Racusen.

She said the disaster relief fund contained no more than $175 million, which is already committed to aiding victims of Hurricanes Irene and Lee and the heavy flooding across the Eastern seaboard.

Lawmakers are quarreling over deeply held principles but a minuscule amount of money in an annual discretionary budget of more than $1.3 trillion.

Early Friday, the House voted mostly along party lines for a spending bill to keep the government operating through Nov. 18. It provided $3.7 billion in new disaster assistance, partly offset with cuts in two loan programs that finance technological development.

House Democrats balked because the cuts included $1.5 billion for an Energy Department program that subsidizes low-interest loans to help car companies and parts manufacturers retool factories to meet new fuel economy standards. Democrats said it would cost up to 10,000 jobs.

The Senate bill scheduled for a vote on Monday is nearly identical to that House bill, with the major exception that it doesn't require spending cuts to offset the FEMA aid.

Democrats said Republicans are cynical in their new-found insistence on offsetting new programs with spending cuts elsewhere. They noted that less than a decade ago, a Republican-controlled White House and Congress enacted two big tax cuts, new wars in Afghanistan and Iraq, and a prescription drug benefit for Medicare without paying for them.

Senate Majority Leader Harry Reid, D-Nev., said he would not "capitulate to the job-destroying bill" from the House.

But GOP leaders said Democrats have not absorbed the lessons of the 2010 elections, when tea party-backed conservatives won a string of victories and put Republicans in control of the House.

House Appropriations Committee Chairman Hal Rogers, R-Ky., said Senate Democrats have chosen "to engage in a political stare-down match that will bring us one step closer to a government shutdown, cause even more instability in our struggling marketplace and cast aside the cries of families and communities across the country that are struggling to get back on their feet after terrible blows from Mother Nature."

White House spokesman Jay Carney faulted House Republicans for the deadlock. He said they passed legislation certain to die in the Senate, just as they did during last summer's fight over extending the federal debt limit.

"The fever hasn't broken," Carney said. "The behavior that we saw this summer that really repelled Americans continues."

With the House and Senate so close in their overall spending targets, it might seem easy for either chamber to yield and avert a crisis.

But House Speaker John Boehner of Ohio has struggled to control a caucus in which several members put spending cuts above all other priorities. And liberal activists have pilloried congressional Democrats and President Barack Obama for yielding too often to GOP demands.

Boehner might find it hard to reconvene the House next week even if he wants to. House Rules Committee Chairman David Dreier, R-Calif., said he was leading a five-member delegation on an overseas trip and won't return until Oct. 3.

The Rules Committee would probably have to sign off on a bill to keep the government running after Oct. 1 before the full House could vote. Dreier said he has no intention of giving someone else the gavel. "We've done our job," he said, referring to the House-passed measure.