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GOP debt plan faces close vote in Congress

China Daily | Updated: 2011-07-29 07:50

WASHINGTON - 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 on 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.

Associated Press

(China Daily 07/29/2011 page12)

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