10/03/2013 06:13 pm ET Updated Oct 03, 2013

Government Shutdown Heads For Collision With Debt Limit

WASHINGTON -- The resolution of the government shutdown appeared headed for a showdown over the fast-approaching national debt limit Thursday as Democrats linked the two and House Speaker John Boehner reportedly pledged to Republican members he would not let the country default.

The joining of the shutdown and the debt limit -- expected to be reached Oct. 17 -- raised both the stakes and the chances of finding a resolution, because the consequences of a default are far worse than a closed government.

According to at least two reports -- both downplayed by Boehner's spokesman -- the Ohio Republican told moderate members of his caucus who are angry about the shutdown that he will not let the nation default, even if he has to depend on Democratic votes.

That comes as Senate Majority Leader Harry Reid (D-Nev.) and Sen. Chuck Schumer (D-N.Y.) both said the debt limit and shutdown should be dealt with together.

Still, the path forward remained unclear because Democrats were sticking by their vow to talk with the GOP only after Republicans open the shuttered government and take potential default off the table.

"We'll talk about anything," Reid told reporters. "But open the government, get the debt ceiling out of here."

"We'll negotiate on anything they want to talk about," Reid emphasized. "But the government has to be open, we have to get the debt ceiling out of the way."

He was echoed by Schumer.

"We'd like to move them both together," Schumer said. "I think having them together is a good thing, because who wants to go through this again? With debt ceiling, it's 20 times as dangerous." While Democrats refuse to talk unless Republicans stop threatening shutdown and default, Schumer argued that was not the same as the GOP's intransigence.

"If one guy has a gun to your head, and you say please don't shoot, you're saying the two sides are the same?" Schumer told a reporter who asked why it wasn't fair to say Democrats were just as dug-in as Republicans.

However, Republicans have long signaled that they think the debt limit is their strongest bit of leverage to win concessions from the Democrats, either on spending or Obamacare.

Boehner has said repeatedly in public that he would not let the nation default, but many members of his caucus have said they think they can avoid a technical default even if the $16.7 trillion debt limit is breached. They argue that the United States can pay principal and interest on its bonds, even if it doesn't meet its other obligations.

For Boehner to flatly pledge to moderates that he would avoid default in the way that most economists define it -- by raising the limit to pay all the nation's bills -- he would likely have to violate the so-called Hastert rule, an informal practice of the GOP caucus of only moving bills that are supported by the majority of Republicans.

Most of those Republicans believe that the debt limit should only be hiked in return for spending cuts, and Boehner spokesman Michael Steel said that remains the speaker's position.

"Speaker Boehner has always said that the United States will not default on its debt, but if we're going to raise the debt limit, we need to deal with the drivers of our debt and deficits," Steel said in a statement. "That’s why we need a bill with cuts and reforms to get our economy moving again."

At least one moderate Republican, however, said he would be willing to reopen the government and boost the borrowing limit with Democratic votes. "If there's an arrangement or deal, then you don't have to get 218 from one side or the other," said Rep. Tom Cole (R-Okla.), a deputy whip of the GOP conference.

Cole acknowledged that the battle lines were over more than restoring government funding.

"I think we're moving toward something a little bit bigger," Cole said.


2013 Government Shutdown
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