Still no deal.
A late-night meeting with House and Senate leaders Thursday failed to break the budget deadlock with hours to go before a midnight deadline on a partial government shutdown.
President Obama huddled with Democratic Senate Majority Leader Harry Reid and Republican House of Representatives Speaker John Boehner at the White House twice Thursday and said he hoped to be able to announce a deal Friday but "there's no certainty yet."
The president told Boehner and Reid that he expected an answer in the morning.
With the economy just beginning to create jobs in large numbers, Obama said, a shutdown would damage the recovery by putting government employees out of work. "For us to go backward because Washington couldn't get its act together is just unacceptable," he said.
Jeff Zients of the Office of Management and Budget, who is overseeing preparations for a possible shutdown, said both the economy and public confidence in the federal government could suffer — even if a shutdown only lasted through the weekend.
"When I think about the scale of the number of operations that will be shut down and then would have to be reopened, I think the impact on the economy even for a short period of time could be relatively significant," Zients told reporters Thursday.
Federal Workers Weigh In
NPR's Brian Naylor talked about the potential shutdown with federal employees in Washington, D.C.
"This is politics, this isn't real life. This is whomever flexing their muscles, showing how powerful they are. This has nothing to do with my government service." — Carol Davison, Commerce Department
"It's like two opposing forces, almost like two dogs fighting over one bone, and you're trying to see who is going to win, you know? Compromise just doesn't seem to be on the agenda. ... I'm pretty sure every federal employee is the bone in the fight right now." — Mark Burton, Department of Energy
"I don't have leave time or anything like that, so I'll go without a paycheck. You think that ... the politicians have our best interests in their minds, but when you look at them, I find it hard to believe when they'll get their paycheck, and we won't." — Tom Cronin, Federal Aviation Administration contractor
"I just feel for those who are barely making it, so to speak. That's the hardest part, because some people are just barely getting by when they are getting a paycheck. So, one week, two weeks? That's how I look at it. It's tough." — Teddy Watson, Housing and Urban Development contractor
"There's no point to this. Of course, you've got some people elected to Congress who don't know how the government works. They really don't understand how much money is going to be lost by this." — Harold Dorwin, Smithsonian Institution
He said essential government personnel would continue doing jobs that protect safety and national security but that about 800,000 employees would stop work until the parties reach a budget deal.
Since taking control of the House in January, Republicans have vowed to slash spending and curb the deficit. Democrats say they are willing to make some cuts, but say the Republicans would cut vital government services and are pushing a social agenda. Republicans have accused the Democrats of using gimmicks instead of making real spending cuts.
The House passed legislation Thursday to fund federal agency operations for yet another week — but also includes $12 billion in additional cuts.
The Republican bill would fund the Defense Department for the rest of the year and, in the event of a shutdown, would ensure that the troops are paid on time. It also contains a so-called policy rider that would deny money for family planning services in Washington, D.C.
House Majority Leader Eric Cantor of Virginia, who led contentious debate on the measure, said that "we will not leave town until we fulfilled our obligation to cut spending to begin getting our fiscal house in order."
But Democrats like Chris Van Hollen, ranking member of the House Budget Committee, objected to the package.
"They are saying unless you yield to our demands on our very radical social agenda, which is what they are trying to impose through this, we are not going to move forward in helping our troops," Van Hollen said. "That is a cynical ploy — the American people will see right through that."
Although the original budget bill approved by the House in February contained dozens of riders — including provisions defunding Planned Parenthood, environmental regulations and financial industry regulations — Republicans argued that conservatives should continue to fight for the additional riders.
"It seems like liberals in the Senate would rather shut the government down than accept a 2 percent cut in the federal budget," said Rep. Mike Pence (R-IN). "It seems like liberals in the Senate would rather shut the government down so they can continue to borrow money from China to fund the largest abortion provider in America.
Obama has vowed to veto the measure and it is unlikely to reach a vote in the Democratic-controlled Senate.
Obama and the Senate have already acted on two such temporary funding laws, but the White House said it would not go for another stopgap measure because that was "a distraction from the real work" of agreeing on legislation to cover the six months left in the current fiscal year.
The impasse, thought to have been mostly fueled by Republican Tea Party members in the House, is over the conservatives' demand that $61 billion be slashed from what the government needs to stay in operation through Sept. 30. The fight is over what amounts to about 12 percent of all government spending and does not deal with the lion's share — defense, old-age pensions and health care for the elderly and the poor.
While Congressional Democrats and the White House have indicated a willingness to accept spending cuts of nearly $35 billion, they have balked at other Republican demands. Republicans want to strip funding from Planned Parenthood, which provides family planning and medical assistance to women, and money the Environmental Protection Agency uses to regulate greenhouse gases and other pollutants.
"We don't have the time to fight over the Tea Party's extreme social agenda," Reid said.
At the White House, a senior budget official said the impact of a shutdown "will be immediately felt on the economy."
It was unclear whether the day's maneuvering marked attempts by negotiators to gain final concessions before reaching agreement, or represented a significant setback.
Either way, Boehner said this fight was just the first of many likely to come as the conservative majority in the House pursues its goals of reducing the size and scope of government.
"All of us want to get on with the heavy lifting that is going to come right behind it, dealing with the federal debt and putting in place a budget for next year," he said.
House passage of the stopgap measure Thursday angered Boehner's Democratic negotiating counterparts and prompted Obama to call for Republicans to display more urgency on long-term funding.
The Republican measure combines a full-year Pentagon budget with the $12 billion in cuts as the price to keep the government running for yet another week. The vote was seen as a clear moved aimed at shifting political blame to the Democrats if a shutdown occurs.
Last year, when Democrats were in charge of both houses of Congress, they failed to complete the must-pass spending bills. That set the stage for Republicans to pass a measure with $61 billion in cuts that even some Republican appropriators saw as unworkable. It was rejected in the Democratic-controlled Senate.
Two government shutdowns in the mid-1990s damaged Republicans, then new to power in Congress, and helped President Bill Clinton win re-election in 1996.
NPR's Ari Shapiro and Audie Cornish reported from Washington, D.C., for this story, which contains material from The Associated Press.
