Bipartisan meet at White House fails to reach consensus

As the shutdown of the U.S. government entered its third straight day on Thursday, Republicans in the House of Representatives and President Barack Obama appeared unwilling to budge on their stances and the prospects of Congress reaching a compromise solution to defuse the crisis of governance grew dimmer.

Speaking at an event in nearby Rockville, Maryland, on Thursday Mr. Obama suggested that the U.S. economy was taking a hit “not because of some financial crisis, [but] because of a reckless Republican shutdown in Washington.”

The shutdown kicked in on Tuesday after lawmakers on Capitol Hill were paralysed by stalemate owing to House Republicans’ demand that the individual mandate and other provisions of Mr. Obama’s landmark healthcare reform policy be defunded before they gave government finances a new lease of life.

Coming out of a closed-door bipartisan meeting on Wednesday evening at the White House Senate Minority Leader Mitch McConnell described the discussion 90-minute meeting as “cordial but unproductive.”

The White House however firmly pushed the ball back into the House’s court, with Spokesperson Jay Carney saying at a briefing that House Speaker John Boehner ought to put it to a vote on the floor, adding, “See if a majority votes yes, be surprised and delighted by the fact that a number of your own Republicans would vote yes... Take that as a win, and move on.”

Meanwhile fears mounted that in the absence of the debt ceiling being raised an adverse event such as a credit ratings downgrade could lead to government default on loans with serious consequences for future economic growth.

Yet according to the latest estimates 19 Republican Congressmen support having a “clean continuing resolution” that would raise the debt ceiling for the federal government without any strings attached on Obamacare, and four Republican Congressmen were “leaning yes” on the vote.

Combined with the 200 votes of House Democrats a clean bill could in theory pass in the House, although most reports concurred that Mr. Boehner was unlikely to allow such a vote fearing the risk of a potential conservative backlash, including from Tea Party groups, which could cost him his office.

Meanwhile close to 800,000 public sector workers in “non-essential services” were furloughed, national parks, monuments, museums remained closed to visitors, and ordinary Americans appeared to be increasingly feeling the pinch of the shutdown.

Among the more important services affected the Environmental Protection Agency and Department of Education were said to have furloughed more than 90 per cent of their employees and Director of National Intelligence James Clapper, who has been in the eye of the storm surrounding the National Security Agency’s surveillance activities, appeared before lawmakers to complain that 70 per cent of intelligence staff had been furloughed with a knock-on effect on national security.

Welfare services targeting vulnerable groups were also impacted by staff furloughs, including the Supplemental Nutrition Program for Women, Infants & Children providing low-income mothers with vouchers for baby formula.

In some cases life-or-death situations were exacerbated after the National Institutes of Health started turning away cancer patients, including children, from clinical trials following the furloughing of 75 per cent of its employees.