U.S. senators hopeful fiscal deal could pass Wednesday

Tue Oct 15, 2013 10:21am EDT

* Senate Republicans schedule morning meeting

* House Republicans' proposal includes Obamacare measures

By Richard Cowan and Susan Heavey

WASHINGTON, Oct 15 (Reuters) - U.S. senators expressed hope that a bipartisan deal could emerge on Tuesday to end Washington's fiscal crisis even as Republicans in the House of Representatives said they were working on a separate plan.

Even if Democrats and Republicans agree, it could be Wednesday before the U.S. Senate signs off on a plan, senators said, close to a Thursday deadline when the Obama administration says it will reach its borrowing limit and risk default.

Republicans in the House of Representatives were discussing an alternative plan that includes measures that would affect President Barack Obama's healthcare reforms, which have been at the heart of the crisis.

"I think we'll get an agreement today in the Senate," Arkansas Democrat Mark Pryor told CNN's "New Day" program.

"I'm not saying we can pass it today because there's logistics about drafting and getting it to the floor and the procedural things we'll have to do ... but my guess is we'll pass something in the Senate tomorrow."

"There's a lot of work that's going to be done over the next two or three days," Republican Senator Bob Corker also said on CNN. But he cautioned it was too early to be sure of a deal. "I don't think it's time to spike the football yet," he said

Congressional sources said that the two sides in the Senate were still at odds over Democrats' demand for a delay in an insurance fee that is part of the new healthcare reforms, which are known widely as Obamacare.

Thursday is the deadline for raising the debt ceiling to extend the government's borrowing authority. The Obama administration says it will be unable to pay all of its bills if Congress does not raise the $16.7 trillion debt limit by then.

The federal government has been in partial shutdown since Oct. 1 when Congress missed the deadline for funding it.

Conservative Republicans prompted the crisis, which has rattled global markets, by demanding major changes to the healthcare reforms as a condition of passing a government spending bill and raising the debt ceiling.

One senior Senate aide said that under the Senate plan being negotiated, the Treasury Department would maintain its ability to use "extraordinary measures" to manage debt payments if a Feb. 7, 2014 deadline for raising U.S. borrowing authority is missed by Congress.

Senate Republicans were scheduled to meet at 11 a.m. ET (1500 GMT). Meanwhile, House Republicans began meeting in the basement of the Capitol at 9 a.m. (1300 GMT).

Pryor and Corker both said their concerns focused on fellow Republicans in the House, where conservatives who are starting to hear about the terms of the Senate agreement were already expressing skepticism, spurred on by conservative organizations.

Among them was the influential "Redstate" web site which urged House conservatives to "stand up and pledge to vote" against the Senate plan. "It does not defund Obamacare. It does not delay Obamacare," wrote the website's editor, Erick Erickson.

The conservative Heritage Foundation, in a blog posted early Tuesday morning, said that "if Congress does anything less than defund Obamacare, it is turning its back" on Americans.

House Republicans associated with the small-government Tea Party movement had no comment on a report that Texas Republican Ted Cruz, a fellow hard-liner in the Senate, met with a group of about 15 to 20 House Republicans late Monday.

The tentative Senate agreement does not defund or delay Obamacare, but some Senate Republicans are seeking minor changes such as tougher income verification for those seeking insurance subsidies under the law and delay to a so-called reinsurance fee.

In the last few days talks have been led by Senate Majority Leader Harry Reid, a Democrat, and his Republican counterpart, Mitch McConnell. Obama telephoned McConnell on Monday evening but neither the White House nor McConnell's office gave details.

Amy Klobuchar, a Minnesota Democrat who is part of a bipartisan group of senators trying to forge a compromise, said an agreement would buy time for a more thoughtful process to settle longer-term budget issues.

The deal would reopen the federal government, pay U.S. bills and allow the parties to commit to further negotiate, she told MSNBC's "Morning Joe" program. "Those are the bright spots."

Numerous polls show Republicans have taken a hit in opinion polls since the standoff began. A Washington Post/ABC News poll released on Monday found that 74 percent of Americans disapprove of the way congressional Republicans have handled the standoff, compared with a 53 percent disapproval rating for Obama.

A survey released by Gallup on Tuesday showed Americans' confidence in the U.S. economy fell five points last week as the government shutdown continued.

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