For US it's traction and truculence

Republicans want a one-year delay in healthcare reforms. Photo / AP
Republicans want a one-year delay in healthcare reforms. Photo / AP

As US Government diplomacy is grinding into gear abroad over Iran and Syria, the wheels are about to fall off at home.

In Washington, the Government will face its first shutdown in nearly 20 years today unless the White House and Republicans can broker a deal to avert a closure that is predicted to cost the economy up to US$2 billion ($2.4 billion).

The prospect of a shutdown increased sharply at the weekend when Republicans in the House of Representatives agreed to fund the US Government but only if Democrats agreed to a one-year delay to President Barack Obama's signature healthcare reforms. Leaders in the Democrat-controlled Senate promised to reject it.

Both sides have accused the other of intransigence and recklessness, as the divisions between Republicans and Democrats that have crippled the working of Washington in recent years were again laid bare.

In contrast to the standoff and inability to negotiate at home, US Secretary of State John Kerry spoke positively yesterday of progress with Tehran, saying a deal could be brokered within months if Iran proves that its nuclear programme is not being used to build atomic weapons.

In an interview with CBS, Kerry said the stated desire by Iranian President Hassan Rouhani for an agreement within three to six months could be met sooner if Iran satisfied certain conditions.

"If it is a peaceful programme, and we can all see that - the whole world sees that - the relationship with Iran can change dramatically for the better and it can change fast."

With the White House cautiously optimistic about its dialogue with Iran, today's meeting between Israeli Prime Minister Benjamin Netanyahu and Obama in the US could be tense. Mortified that the world may be warming to Iran, Netanyahu is taking an unpopular message to the White House and the United Nations this week.

Netanyahu contends that Iran is using conciliatory gestures as a smokescreen to conceal an unabated march towards a nuclear bomb.

He will try to persuade the US to maintain tough economic sanctions and not allow the Islamic republic to move closer to becoming a nuclear threshold state. "I will tell the truth in the face of the sweet talk and the onslaught of smiles," Netanyahu said.

Meanwhile, as an initial group of 20 chemical weapons inspectors left for Damascus, Syria's President vowed to abide by the UN resolution calling for the country's chemical weapons stockpile to be destroyed. Speaking to Italy's RAI News 24 TV, President Bashar al-Assad said his Government approved of the UN Security Council plan to eliminate Syria's chemical weapons and also agreed to join the international convention that outlaws such arms.

US government funding impasse

Why might the US government shut down?

Political divisions have made it impossible to pass a budget through Congress. Instead, a stop-gap funding measure called a "Continuing Resolution" has been passed to keep the government funded. The current CR runs out at midnight local time (this afternoon), with no sign of agreement.

Is the "Continuing Resolution" the same as the debt ceiling?

No. The debt ceiling is potentially far more serious. Set by Congress, this is the upper limit the government can borrow. The US Treasury estimates it will be exhausted on October 17.

Why won't Congress pass a new CR, or vote to raise the debt ceiling?

A minority of Republicans are refusing unless they get major concessions: most notably de-funding or delaying "Obamacare". The President is refusing to negotiate on health care.

Will the Republicans really go through with this? Don't they always reach a deal in the end?

Don't bet on it. A shutdown happened in 1995 and 1996, and for Tea Party Republicans in the House of Representatives a shutdown would be a badge of honour, and prove their commitment to fiscal responsibility.

What happens if the US government shuts down?

About half of government workers get unpaid leave. Non-essential services stop. The last shutdowns cost more than US$1 billion. Now it could cost twice as much.

Breaching the debt ceiling would be more serious and would have global ramifications since the government would be unable to meet about 40 per cent of its obligations.


- Daily Telegraph UK

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