Optimism but no deal in US fiscal showdown - Page 2 of 3 - Capital Business
Connect with us

Hi, what are you looking for?

US President Barack Obama speaks during a meeting with small business owners in the White House in Washington/AFP

Top Story

Optimism but no deal in US fiscal showdown

Such a solution would be somewhat of a face saver for Republicans who entered the showdown determined to leverage the need to raise the debt ceiling as a way to defund or delay so-called Obamacare.

Republicans from the lower house have offered to talk to Obama about a short-term resolution to fund the government, and then to move to long-term budget and fiscal talks.

But the president insists he will not negotiate until both the debt ceiling is raised and the government is reopened.

Republican senators emerged from the White House talks into a rainstorm, and told reporters they were optimistic.

Arizona Senator Jeff Flake said there had been a “good talk” but no deal was reached.

Senator Lindsey Graham said he was “confident that in the next 24 to 48 hours the House will produce a continuing resolution that will allow the government to be open in total.”

Senator Mike Johanns added: “everybody is talking to everybody now, and I’m encouraged by that.”

But Senate Majority Leader Harry Reid signaled that Democrats were driving a hard bargain.

The Senate will vote Saturday on a 15-month extension of the debt ceiling, to take the issue off the table until after the mid-term congressional elections next year.

Advertisement. Scroll to continue reading.

While the measure is unlikely to become law because it needs House support, it could provide a template for an eventual solution in the event of a longer term fiscal deal between Obama and Republicans.

Hopes for a deal spurred a rally in Asian stocks overnight and Wall Street followed the trend into positive territory.

The Dow Jones Industrial Average finished up 111.04 (0.73 percent) to 15,237.11.

If the US debt ceiling is not raised by October 17, the Treasury would run out of money and could begin defaulting on US obligations for the first time in history, with likely dire consequences for the world economy.

Pages: 1 2 3

Advertisement

More on Capital Business