House GOP unveils counter to Senate debt plan

WASHINGTON (AP) — House GOP leaders unveiled their own plan Tuesday to counter an emerging Senate deal to reopen the government and forestall an economy-rattling default on U.S. obligations.

Top Republicans unveiled a plan that would suspend a new tax on medical devices for two years and take away the federal government's contributions to lawmakers' health care and top administration officials in addition to funding the government through Jan. 15 and giving Treasury the ability to borrow normally through Feb. 7.

The move came as a partial shutdown entered its third week and less than two days before the Treasury Department says it will be unable to borrow and will rely on a this cash cushion to pay the country's bills.

Rep. Darrell Issa, R-Calif., said Republicans plan to pass the measure later Tuesday. It could prove tricky because Democrats probably won't support it. The House GOP plan wouldn't win nearly as many concessions from President Barack Obama as Republicans had sought but it would set up another battle with the White House early next year.

"The jury is still out," said Rep. Michael Burgess, R-Texas.

Rep. Walter Jones, R-N.C., said he was not sure he could vote for the plan because it did not address the debt. "I have to know a lot more than I know now," he said.

The House move comes after conservative lawmakers rebelled at the outlines of an emerging Senate plan by Majority Leader Harry Reid, D-Nev., and GOP leader Mitch McConnell of Kentucky. Those two hoped to seal an agreement on Tuesday, just two days before the Treasury Department says it will run out of borrowing capacity.

The White House and Democrats quickly came out against the Republican plan.

"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," said White House spokeswoman Amy Brundage. "Democrats and Republicans in the Senate have been working in a bipartisan, good-faith effort …. With only a couple days remaining until the United States exhausts its borrowing authority, it's time for the House to do the same."

"GOP's latest plan is designed to torpedo the bipartisan Sen solution," tweeted Rep. Chris Van Hollen, D-Md. "Plan is not only reckless, it's tantamount to default."

Political pressure is building on Republicans to reopen the government and GOP leaders are clearly fearful of failing to act to avert a default on U.S. obligations.

Republicans are in a difficult spot, relinquishing many of their core demands as they take a beating in the polls. Rep. Steve Southerland, R-Fla., led GOP lawmakers in several verses of "Amazing Grace."

Like the House GOP bill, the emerging Senate measure — though not finalized — would reopen the government through Jan. 15 and permit the Treasury to borrow normally until early to mid-February, easing dual crises that have sapped confidence in the economy and taken a sledgehammer to the GOP's poll numbers.

"There are productive negotiations going on with the Republican leader," Reid said as he opened the Senate Tuesday. "I'm confident we'll be able to reach a comprehensive agreement this week in time to avert a catastrophic default."

On Wall Street, stocks were mixed early Tuesday, with investors somewhat optimistic over a potential deal.

"We're willing to get the government open. We want to get the government open," Scalise said. "Hopefully they get something done that addresses the spending issue."

The competing House and Senate plans are a far cry from the assault on "Obamacare" that tea party Republicans originally demanded as a condition for a short-term funding bill to keep the government fully operational. It lacks the budget cuts demanded by Republicans in exchange for increasing the government's $16.7 trillion borrowing cap.

Nor do either the House or Senate frameworks contain any of a secondary set of House GOP demands, like a one-year delay in the health law's mandate that individuals buy insurance.

Another difference between the Democrats and Republicans involves a Democratic move to repeal a $63 fee that companies must pay for each person they cover under the big health care overhaul beginning in 2014. Unions oppose the fee and Senate Democrats are pressing to repeal it, but House Republicans are positioning to block them and Senate Republicans are adamantly opposed as well.

Democrats were standing against a GOP-backed proposal to suspend a medical device tax that was enacted as part of the health care law, but might not be able to win a floor vote since many Democrats oppose the tax too.

Democratic and Republican aides described the outlines of the potential agreement on condition of anonymity because the discussions were ongoing.

But with GOP poll numbers plummeting and the country growing weary of a shutdown entering its third week, Senate Republicans in particular were eager to end the shutdown — and avoid an even greater crisis if the government were to default later this month.

Any legislation backed by both Reid and McConnell can be expected to sail through the Senate, though any individual senators could delay it.

But it's another story in the House, where it wasn't winning a lot of fans among conservatives.

Rep. Joe Barton, R-Texas, signaled that conservative members of the House were deeply skeptical. He said any bill had to have serious spending cuts for him to vote to raise the debt ceiling and said he thought Obama and Treasury Secretary Jack Lew had more flexibility than they had said publicly.

"No deal is better than a bad deal," Barton said.

Asked whether the emerging package contained any victories for Republicans, Rep. James Lankford, R-Okla., a member of the House GOP leadership, said, "Not that I've seen so far, no."

In addition to approving legislation to fund the government until late this year and avert a possible debt crisis later this week or month, the potential pact would set up broader budget negotiations between the GOP-controlled House and Democratic-led Senate. One goal of those talks would be to ease automatic spending cuts that began in March and could deepen in January, when about $20 billion in further cuts are set to slam the Pentagon.

Democrats also were seeking to preserve the Treasury Department's ability to use extraordinary accounting measures to buy additional time after the government reaches any extended debt ceiling. Such measures have permitted Treasury to avert a default for almost five months since the government officially hit the debt limit in mid-May, but wouldn't buy anywhere near that kind of time next year, experts said.

The House GOP plan would repeal the extraordinary measures, which would make the Feb 7 date a hard deadline to revisit the fight.

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Associated Press writers Donna Cassata, David Espo, Henry C. Jackson, Julie Pace and Alan Fram contributed to this report.