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US shutdown: Congress, Obama reach compromise

October 17, 2013

Sixteen days into a US Government shutdown – and just hours away from the witching hour of unprecedented debt default – Washington came to its senses late Wednesday, lurching away from the brink with a last-minute accord to end both crises.
The deal was sealed in a final tic-tac-toe sequence of votes in the Senate and the rebel-laced House of Representatives, putting President Barack Obama within signing distance of ending one of the most humiliating displays of Congressional discord in modern American history.
Obama vowed to “sign it immediately” — a move that eased global economic fears, signalling the formal lifting of the U.S. debt ceiling and ensuring the country’s ability to continue paying its bills.
“We’ll begin reopening our government immediately, and we can begin to lift this cloud of uncertainty and unease from our businesses and from the American people,” Obama told reporters at the White House.
The deal leaves the Affordable Care Act, or Obamacare, largely intact, codifying a withering defeat that was days in the making for Republicans, and their raucous Tea Party caucus.
And it means an end to furloughs for some 800,000 federal workers — those deemed “non-essential” to agencies ranging from NASA to national parks.
But the agreement merely buys time, punting the larger political war over the country’s almost $17-trillion national debt to the new year, when hardcore fiscal conservatives in Washington are expected to launch their battle anew.
As negotiations came to a boil in the Senate, the slow-motion defeat took hold among Congressional Republicans, where bitterness and recriminatory finger-pointing reigned supreme.
The most visible target: Canadian-born Texas Sen. Ted Cruz, who lost even the support of his home state’s largest newspaper, the Houston Chronicle, which withdrew its endorsement over Cruz’s role in fomenting the crisis.
The roasting of Cruz came from all corners. But none so contemptuously as New York Rep. Peter King, who encouraged fellow Republicans to effectively shun Cruz forever.
“He’s the guy that caused this, he’s the guy that caused us defeat, he’s the guy who was a fraud because he never had a strategy to begin with,” King told Roll Call. “If we were to let him do it again, it’s our fault.”
The first trickling of global reaction suggested the United States is unlikely to emerge wholly unscathed by so flagrantly displaying its political dysfunction on the world stage. Most fixed on the question of what can be done to quarantine the continuing Tea Party threats within the United States in such a way that international trade is not also held hostage to purely domestic U.S. concerns.
“It was irresponsible for a country with the world reserve currency to act in this manner, so it’s a relief that this is over in the immediate,” said Stephany Griffiths-Jones, a financial markets expert at Columbia University.
“But such a crisis gives impetus for reforms like a global currency that typically have in the past seemed a bit utopian but now sound more realistic.”
The International Monetary Fund has advanced the concept of SDR (special drawing rights), in which a global currency based on a basket of currencies eventually dislodges the U.S. dollar as the international norm.
On Tuesday, China, one of America’s largest creditors, urged an accelerated shift toward a global reserve currency, saying the current U.S. crisis is “a good time for the befuddled world to start considering building a de-Americanized world.”
But as this, the fourth major shambolic fiscal showdown of the Obama era winds down, few expect the lull to last much beyond the winter holiday season.
Yet the context of the next battle remains unclear, as a crucial element of Obama’s health care reforms — the launch of online insurance exchanges — continues to stumble through weeks of crippling software glitches.
A continuing Republican war on Obamacare may not be music to Democratic ears. But if the alternative is more Tea Party brinksmanship with the global economy, the world is unlikely to take offence.

Posted from WordPress for BlackBerry.

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