Deal Still Possible Before Government Shuts Down on Tuesday

BRADENTON – It remains unclear whether there will be a government shutdown on Tuesday, as leaders in Washington remain at an impasse regarding a deal to authorize raising in the U.S. debt limit in order for the U.S. Treasury to make good on spending previously authorized by Congress. As the deadline approaches, however, Washington began to express increased confidence Sunday that a 12th-hour deal would be struck.

Failing to increase the debt limit would ultimately cause the U.S. government to default on its legal debt obligations for the first time in American history. The last time Washington played chicken with the debt ceiling in 2011, the Government Accountability Office (GAO) estimated that the delay in raising the ceiling increased government borrowing costs by $1.3 billion that year.

House Republican leaders said late Sunday afternoon that they still believed a shutdown could be avoided if Democrats would accept at least some of their demands to scale back President Obama’s health care law.

The House passed legislation Sunday to delay the implementation of the Affordable Care act for one year and rescind a tax on medical devices that helps to fund it. That bill does not have enough support to pass in the Senate, and the President has said he would veto it, should it reach his desk.

House leaders then suggested that delaying the so-called individual mandate portion and rescinding the medical device tax might be enough. Removing the mandate would, however, all but eviscerate the exchanges set to open Tuesday – a key component of the reforms, as the increased participation is what lowers premium costs and allows insurers to enroll even those with serious pre-existing conditions, without higher costs or exclusionary coverage.

The President has said in no uncertain terms that he will not dismantle health care reform in order to raise the debt limit, pointing out that the law has passed and withstood a Supreme Court challenge.