First U.S. shutdown in 17 years unavoidable with no talks

The U.S. government stands poised for its first partial shutdown in 17 years at midnight tonight, after a weekend with no signs of negotiations or compromise from either the House or Senate to avert it.

Republicans and Democrats in Congress say they don’t want to close the government, though neither side is budging from their positions to avoid it. House Republicans, led by Speaker John Boehner of Ohio, want to delay President Barack Obama’s Affordable Care Act for a year and make other changes to the health-care law. Democrats vow not to let that happen.

Hanging in the balance are 800,000 federal workers who would be sent home tomorrow if Congress fails to pass a stopgap spending bill before funding expires tonight. Standard & Poor’s 500 Index futures (CME:SPZ13) slid and Asian stocks retreated on concern of a shutdown, while Treasuries advanced.

“I’m afraid, based on what Speaker Boehner has said so far, that we are going to look at a shutdown,” Representative Chris Van Hollen of Maryland, the top Democrat on the House Budget Committee, said today on Bloomberg Television.

The fallout would be far-reaching: national parks and Internal Revenue Service call centers probably would close. Those wanting to renew passports would have to wait and the backlog of veterans’ disability claims could increase.

Political Blame

The political implications are much less clear. Democrats are painting Republicans as obstructionists who are trying to undo a law passed by Congress and upheld by the Supreme Court. Republicans say they are trying to save Americans from the effects of Obamacare and that Democrats won’t negotiate.

A Bloomberg National poll conducted Sept. 20-23 shows Americans narrowly blame Republicans for what’s gone wrong in Washington, just as they did when the government closed in 1995 and 1996 -- two of the 17 times U.S. funding stopped since 1977. A CNN/ORC International poll conducted Sept. 27-29 and released today said that 46% of respondents would blame congressional Republicans for a shutdown, while 36% would say the president was responsible.

The Senate convenes at 2 p.m. today and is set to reject the House’s latest plan to delay Obamacare and repeal a tax on medical devices, and send back a temporary spending measure.

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