House rejects US debt limit Bill
Published 29/07/2011 | 23:52
The Republican-led House of Representatives has rejected a Senate Democratic Bill to raise America's debt limit just three days before the deadline to avert a first-ever default on US financial obligations.
With tensions high at a rare weekend session, the legislation failed on a 246-173 House vote that was largely symbolic. The Senate has yet to vote on the Bill.
Saturday's result, however, could pave the way for negotiations on a compromise with Tuesday's deadline on the government's ability to pay its bills fast approaching.
Shortly after the House vote, President Barack Obama stepped back into the debt ceiling talks, calling Congress's top two Democrats, Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi, to the White House for a meeting.
Top congressional leaders and the White House now have little time to work out a deal that can pass both chambers of Congress and be signed by President Obama before a Tuesday deadline to avoid default.
Tuesday is when the government says it will run out of money to meet its financial obligations. It needs Congress to approve an increase in its borrowing authority, known as the debt ceiling. Past increases have been routine, but Republicans, citing the giant US deficit, have demanded huge spending cuts as a condition for approving the increase.
"There is very little time," Mr Obama said on Saturday in his weekly radio and internet address. He called for an end to political gamesmanship, saying "the time for compromise on behalf of the American people is now".
Setting the stage for the high-stakes weekend, late on Friday Senate Democrats killed a House-passed debt-limit increase and budget-cutting Bill less than two hours after it squeaked through the House of Representatives. Senate Majority Leader Harry Reid set up a test procedural vote for the small hours of Sunday morning on his own legislation.
Mr Reid's task was made more difficult after 43 Senate Republicans declared they would oppose his Bill - enough to block it from coming to a final vote. Mr Reid's measure would raise the debt limit by 2.4 trillion US dollars while cutting spending by 2.2 trillion dollars.
Republican leaders in Congress later said they were confident that the impasse will end soon. Mr Boehner and Senate Republican leader Mitch McConnell made the prediction after the Republican-led House rejected the Senate Democrats' rival plan.