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US budget rivals produce two plans

US politicians in both houses of Congress have been trying to agree separate plans to reopen the government and avoid a federal financial default that could tip the global economy back into recession.

The Senate moved first, taking the country halfway toward solving a fight between Republicans and president Barack Obama's Democrats over government spending.

In the House of Representatives, Republican leaders began moving toward a similar deal, apparently viewing a shift in tactics as inevitable. Many conservatives, however, still were standing fast against the plan that would fund the government up to January 15 and allow the Treasury to borrow money to pay bills until February.

The White House quickly dismissed the House plan. "The President has said repeatedly that members of Congress don't get to demand ransom for fulfilling their basic responsibilities to pass a budget and pay the nation's bills," said a White House spokeswoman.

"Unfortunately, the latest proposal from House Republicans does just that in a partisan attempt to appease a small group of Tea Party Republicans who forced the government shutdown in the first place."

House Speaker John Boehner and other Republican leaders had outlined their own bill that also would keep the government running into the New Year and raise the debt limit.

But they indicated that it was linked to concessions on Obamacare, the president's hard-fought healthcare reforms.

With just two days left before the Treasury Department says it will run out of borrowing capacity, congressional aides predicted Democratic Senate Majority Leader Harry Reid and Republican leader Mitch McConnell could seal an agreement, easing dual crises that have sapped confidence in the world's dominant economy and badly shaken support for Republicans.

The partial government shutdown, which has laid off 350,000 federal workers, began on October 1 after Congress failed to pass a bill to temporarily fund the government. Separately, if Congress does not approve a measure increasing the amount of money the government is allowed to borrow, the Obama administration says it will not be able to pay America's bills on time, risking a default that analysts say could prove catastrophic for the economy. Both legislative measures are normally routine.

With Republican popularity plummeting and Americans growing weary of a shutdown entering its third week, Senate Republicans in particular were eager to end the impasse - and avoid an even greater crisis if the government were to default later this month.

-AP

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