WASHINGTON -- Just hours before the October 1 deadline passed for Republican and Democratic lawmakers to approve continued funding for U.S. government operations, U.S. President Barack Obama warned that a government shutdown and a looming fight over the government’s borrowing limit threatened the world economy.
"We are the foundation of the world economy and the world financial system," Obama said on September 30, hours ahead of a midnight deadline for a bill to continue funding government operations. "Our currency is the reserve currency of the world. We don't mess with that. And we certainly don't allow domestic policy differences on issues that are unrelated to the budget to endanger not only our economy but the world economy."
Here's a closer look at how we got here.
What's the cause of disagreement?
The Republican majority in the House of Representatives opposes the new Health Care Affordability Act, which takes effect on October 1. Also known as "Obamacare," the 2010 law makes it mandatory for all citizens to have health insurance and establishes low-cost plans to make it easier to participate.
Republicans first tried to stop Obamacare by cutting off its funding; they attached a provision to defund it to what is usually a routine spending bill to continue funding the government.
But the Senate, which is controlled by Obama’s Democratic Party, wouldn’t accept any modifications to the new health-care act. So it rejected the entire spending bill.
Last week, sensing a looming impasse, Republicans modified their request to a one-year delay of Obamacare, plus some additional measures to weaken its effect. They passed that bill over the weekend.
But Senate Democrats still considered it a poison bill and wouldn’t pass it. Without Senate approval by midnight in Washington on September 30-October1, the White House budget office directed federal agencies to start an orderly shutdown.
No passage by the Senate means no funding for the government. Thus the standoff.
Has this ever happened before?
Yes, for 28 days in 1995 and 1996. Then-President Bill Clinton vetoed a spending bill that landed on his desk from the Republican-controlled Congress because he didn’t agree with its funding levels for education, environmental protections, and pensioner health care.
So what happens with a partial government shutdown?
People who work for the federal government will be hardest hit. Around 1.2 million of 2 million government employees will be told to stay home and will stop receiving paychecks.
Workers the government deems essential -- including prison guards, air-traffic controllers, border-patrol officers, and food inspectors -- will be kept on the job but without pay.
In a video message to U.S. troops released as the deadline passed, Obama said he had signed a law to ensure that U.S. soldiers get paid on time. Obama said American operations will continue in Afghanistan and elsewhere.
"Ongoing military operations, like our efforts in Afghanistan, will continue," the president said. "If you're serving in harm's way, we're going to make sure you have what you need to succeed in your missions. Congress has passed, and I'm signing into law, legislation to make sure you get your paychecks on time, and we'll continue working to address any impact this shutdown has on you and your families."
Veterans, people who are disabled, pensioners, and the poor will continue receiving government assistance checks.
With no workers to staff them, national parks will close. Federal agencies like the Environmental Protection Agency (EPA) will shut down. Passport, visa, and immigration services will be delayed.
And in a blow to panda lovers everywhere, the National Zoo's live "PandaCam" is going dark.
Does the political showdown between Republican and Democratic lawmakers have anything to do with the government running out of money on October 17 and that looming fight over raising the borrowing limit?
Somewhat, because many of the same Republican lawmakers who oppose the Affordable Health Care Act oppose raising the government’s $16.7 trillion debt limit for the same reason: They think the government spends too much money.
Some Republicans have already said they plan to attach controversial amendments to the debt-ceiling bill, which would prevent a "clean vote."
If the debt ceiling isn't raised, the U.S. government could struggle to pay its creditors and fund the government.
A U.S. default would be unprecedented. Sliding financial markets are already reflecting the uncertainty, and analysts say if the crisis continues they could react violently and trigger worldwide consequences.
"We are the foundation of the world economy and the world financial system," Obama said on September 30, hours ahead of a midnight deadline for a bill to continue funding government operations. "Our currency is the reserve currency of the world. We don't mess with that. And we certainly don't allow domestic policy differences on issues that are unrelated to the budget to endanger not only our economy but the world economy."
Here's a closer look at how we got here.
What's the cause of disagreement?
The Republican majority in the House of Representatives opposes the new Health Care Affordability Act, which takes effect on October 1. Also known as "Obamacare," the 2010 law makes it mandatory for all citizens to have health insurance and establishes low-cost plans to make it easier to participate.
Republicans first tried to stop Obamacare by cutting off its funding; they attached a provision to defund it to what is usually a routine spending bill to continue funding the government.
But the Senate, which is controlled by Obama’s Democratic Party, wouldn’t accept any modifications to the new health-care act. So it rejected the entire spending bill.
Last week, sensing a looming impasse, Republicans modified their request to a one-year delay of Obamacare, plus some additional measures to weaken its effect. They passed that bill over the weekend.
But Senate Democrats still considered it a poison bill and wouldn’t pass it. Without Senate approval by midnight in Washington on September 30-October1, the White House budget office directed federal agencies to start an orderly shutdown.
No passage by the Senate means no funding for the government. Thus the standoff.
Has this ever happened before?
Yes, for 28 days in 1995 and 1996. Then-President Bill Clinton vetoed a spending bill that landed on his desk from the Republican-controlled Congress because he didn’t agree with its funding levels for education, environmental protections, and pensioner health care.
So what happens with a partial government shutdown?
People who work for the federal government will be hardest hit. Around 1.2 million of 2 million government employees will be told to stay home and will stop receiving paychecks.
Workers the government deems essential -- including prison guards, air-traffic controllers, border-patrol officers, and food inspectors -- will be kept on the job but without pay.
In a video message to U.S. troops released as the deadline passed, Obama said he had signed a law to ensure that U.S. soldiers get paid on time. Obama said American operations will continue in Afghanistan and elsewhere.
"Ongoing military operations, like our efforts in Afghanistan, will continue," the president said. "If you're serving in harm's way, we're going to make sure you have what you need to succeed in your missions. Congress has passed, and I'm signing into law, legislation to make sure you get your paychecks on time, and we'll continue working to address any impact this shutdown has on you and your families."
Veterans, people who are disabled, pensioners, and the poor will continue receiving government assistance checks.
With no workers to staff them, national parks will close. Federal agencies like the Environmental Protection Agency (EPA) will shut down. Passport, visa, and immigration services will be delayed.
And in a blow to panda lovers everywhere, the National Zoo's live "PandaCam" is going dark.
Does the political showdown between Republican and Democratic lawmakers have anything to do with the government running out of money on October 17 and that looming fight over raising the borrowing limit?
Somewhat, because many of the same Republican lawmakers who oppose the Affordable Health Care Act oppose raising the government’s $16.7 trillion debt limit for the same reason: They think the government spends too much money.
Some Republicans have already said they plan to attach controversial amendments to the debt-ceiling bill, which would prevent a "clean vote."
If the debt ceiling isn't raised, the U.S. government could struggle to pay its creditors and fund the government.
A U.S. default would be unprecedented. Sliding financial markets are already reflecting the uncertainty, and analysts say if the crisis continues they could react violently and trigger worldwide consequences.