Obama reaches out to Republicans on ending fiscal logjam

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Obama reaches out to Republicans on ending fiscal logjam

(Xinhua) 13:25, October 11, 2013

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WASHINGTON, Oct. 10 -- As the fiscal wrangle over U.S. federal government's budget and debt ceiling drags on and has attracted criticism from experts across a broad spectrum, U.S. President Barack Obama on Thursday reached out to Republican leaders in an effort to end the fiscal deadlock.

A Thursday White House meeting between Obama and 20 House Republicans led by U.S. House Speaker John Boehner and House Majority Leader Eric Cantor ended with no decision made on how to end the government shutdown or raise the nation's debt limit.

However, this is the first serious talk between Obama and his Republican foes during this fiscal tug-of-war. Both sides kept negotiating to seek a way out of the impasse.

"The President had a good meeting with members of the House Republican Leadership this evening; the meeting lasted approximately an hour and a half. After a discussion about potential paths forward, no specific determination was made. The President looks forward to making continued progress with members on both sides of the aisle," the White House said in a readout after the meeting.

"The President's goal remains to ensure we pay the bills we've incurred, reopen the government and get back to the business of growing the economy, creating jobs and strengthening the middle class," noted the readout.

"The President is happy that cooler heads at least seem to be prevailing in the House, that there at least seems to be a recognition that default is not an option," White House spokesman Jay Carney told reporters during the daily briefing on Thursday.

"We had a very useful meeting," Cantor told reporters after returning from the White House Thursday evening. "Our teams are going to be talking further tonight. We'll have more discussion. We'll come back to have more discussion. The President said that he would go and consult with the administration folks and hopefully we can see a way forward after that."

As the partial government shutdown is in its 10th day, Washington faces another fiscal deadline. Treasury Secretary Jacob Lew has told Congress that the federal government will reach its debt ceiling of 16.7 trillion U.S. dollars by Oct. 17, and failure to raise it would lead to a catastrophic default.

Earlier Thursday, House Republicans floated the idea of approving a six-week debt ceiling increase to avert a debt default crisis. However, the plan did not touch upon ending the government shutdown, a policy priority for Obama.

Both sides are also mulling over different options to reopen the government. The discussion is moving on, but there is no consensus yet.

Obama wanted to "have the shutdown stopped," Hal Rogers, chairman of the House Appropriations Committee, told reporters after returning to Congress following the White House meeting.

Obama did not intend to accept significant reductions in entitlement programs including Medicare and Medicaid in exchange for raising the debt ceiling proposed by Republicans. Lew and Federal Reserve Chairman Ben Bernanke told their counterparts of the Group of 20 (G20) on Thursday that they believed the stalemate over the U.S. debt limit will be resolved by Oct. 17, local media reported.

As Lew and Bernanke are set to set to attend the annual meetings of the International Monetary Fund and World Bank scheduled to start Friday in Washington, many have voiced their concerns about the U.S. fiscal deadlock.

Failure to raise the U.S. debt ceiling could have harsh economic consequences worldwide, Angel Gurria, secretary general of the Organization for Economic Cooperation and Development (OECD), warned here on Thursday.

"This is serious. It's not just about the United States...You would have an impact everywhere," the OECD chief told reporters in Washington.

The fiscal uncertainties in the United States has global implications, and will undermine the efforts of ending poverty in developing countries, Sri Mulyani Indrawati, Managing Director and Chief Operating Officer of the World Bank Group, cautioned on Thursday.

"Being the biggest economic power in the world, whatever happens here is going to affect all the developing countries," she told reporters.