WASHINGTON (AP) — House Republicans are pressing ahead with a vote on a quickly revised plan to stave off an unprecedented government default next week even though the legislation has been stymied by conservative dissent, a White House veto threat and unanimous opposition among Senate Democrats.
As the House prepared to vote on raising the debt limit Thursday, investors worried that a dysfunctional Congress might remain gridlocked sent stocks plunging. The Dow Jones industrial average fell nearly 200 points and appeared headed for its worst week in nearly a year.
Without legislation in place by Aug. 2, administration officials say the Treasury will not be able to pay all the nation's bills, possibly triggering a default that could prove catastrophic for an economy still recovering from the worst recession since the Depression.
Deciding whether to support Speaker John Boehner's plan to raise the debt ceiling in exchange for trillions of dollars in federal spending cuts has vexed newly empowered House Republicans more than any other question in the seven months since they assumed control of the lower chamber and promised to change the way Washington works.
Some in the conservative tea party movement that helped propel the Republican gains in the 2010 elections concluded that Boehner already had betrayed them by negotiating with President Barack Obama on possibly increasing government revenues — meaning taxes — as part of a debt deal. Others said he deserved more time to put things right.
The split is less about conservative ideology than whether a deal that can pass into law hurts the Republicans' deficit-slashing brand and chances for victory in the 2012 elections, when Obama faces re-election.
Boehner appeared to make headway with conservatives who were angry that the bill didn't cut spending enough.
"We're getting there," he said, ahead of Thursday's scheduled vote on his Republican bill before the government's ability to borrow expires on Tuesday. The bill was hastily rewritten to show deeper spending cuts.
The White House disparaged the bill Republicans were working so hard to pass, and Senate Majority Leader Harry Reid in the Democratic-controlled upper chamber was even more emphatic. "A big wet kiss for the right wing," he called it.
The White House has threatened a veto, saying the bill does not meet Obama's demand for an increase in the debt limit large enough to prevent a rerun of the current crisis next year, in the heat of the 2012 election campaign.
Instead, Obama supports an alternative drafted by Reid that also cuts spending yet provides enough additional borrowing authority to tide the government over through 2012. The Senate measure does not include an increase in tax revenue, which had been a key Obama requirement until now.
While Boehner holds out hope that the Senate will pass his measure, a more likely outcome is a last-ditch effort to find a compromise.
In fact, Boehner's plan has enough in common with Reid's — including the establishment of a special congressional panel to recommend additional spending cuts this fall — that Reid hinted a compromise could be easy to snap together.
"Magic things can happen here in Congress in a very short period of time under the right circumstances," Reid told reporters.
While the bills differed in key details, they also shared similarities that underscored the concessions made by the two sides in recent days. Reid's bill does not envision a tax increase to reduce deficits, a bow to Republicans. But the House measure also doesn't require passage of a constitutional balanced budget amendment for state ratification, a step in the direction of Obama and the Democrats.
Boehner was blunt in the meeting with rank-and-file Republican lawmakers on Wednesday. "Get your ass in line," he told them. "I can't do this job unless you're behind me."
If House conservatives torpedo the bill, any follow-up legislation would probably require Democratic votes to pass. That, in turn, would mean smaller spending cuts than Republicans are seeking in exchange for raising the nation's $14.3 trillion debt limit.
As Thursday's vote approached, some Republicans seemed to be swinging behind the legislation, however reluctantly. Strong opposition remained from some lawmakers, though.
"I don't know where the votes are today," said Rep. Jim Jordan, a leader of the Republican Study Committee, an organization of conservative Republican lawmakers who often have disagreed with the leadership. "I just know that I am against the bill."
Associated Press writers David Espo, Alan Fram, Jim Abrams, Laurie Kellman, Stephen Ohlemacher, Donna Cassata, Nancy Benac, Ben Feller, Jim Kuhnhenn and Erica Werner contributed to this report.