BUSINESS

Obama cancels Asia trip, blames Republicans for government shutdown he says is hurting trade

10/04/2013 01:35 EDT | Updated 01/23/2014 06:58 EST
WASHINGTON - President Barack Obama is cancelling a trip to Asia to stay in Washington and push for an elusive funding bill to get the federal government back up and running after days of a shutdown, with no end in sight.

The White House, in a statement late Thursday, blamed Republicans, saying the "completely avoidable" government shutdown was hurting the president's efforts to promote trade and U.S. influence in emerging world markets. Secretary of State John Kerry flew to Bali, Indonesia, on Friday and will head the U.S. delegation to the summits.

Obama's decision to skip the summits in Indonesia and Brunei was an indication of how entrenched the stand-off appeared to be as it entered its fourth day. Funding for much of the government has been cut off since Tuesday, when a Republican effort to thwart President Barack Obama's new health care law stalled a normally routine spending bill that would have kept the government going.

Obama had been set to leave Saturday night for the Pacific island getaway of Bali for a meeting of the Asia Pacific Economic Cooperation. It originally was scheduled as one of four Asian stops, and the White House announced earlier in the week that the final legs of Malaysia and the Philippines were being cut because of staffing problems due to the shutdown. Obama had held out hope that a budget deal would allow the visit to Bali and Brunei, where more economic summits were planned, but decided the cancel the entire trip Thursday.

"The cancellation of this trip is another consequence of the House Republicans forcing a shutdown of the government," White House press secretary Jay Carney said in a statement. "This completely avoidable shutdown is setting back our ability to create jobs through promotion of U.S. exports and advance U.S. leadership and interests in the largest emerging region in the world."

The Labor Department, meanwhile, did not issue the monthly employment report for September that was due Friday because of the shutdown.

Democrats pointed to disagreements within the Republican Party, where reluctant congressional leaders were prodded into a showdown over government funding and Obama's health care law by rowdier conservatives, such as Texas Sen. Ted Cruz.

To get the government working again, "it will take some coming together on the Republican side," said the House's lead Democrat, Rep. Nancy Pelosi of California.

"It's very hard to negotiate with the Republicans when they can't negotiate with themselves," Pelosi told CBS "This Morning" on Friday.

John Boehner, the Republican speaker of the House of Representatives, demanded Friday that the White House and congressional Democrats negotiate with Republicans about ways to re-open the government and address criticisms of the president's health care law.

Boehner told reporters Friday: "This isn't some damn game."

The Republican-controlled House planned a vote Friday to fund a popular program providing food aid to pregnant women and their children, as well as ongoing disaster relief. The White House and Democratic allies in Congress reject the strategy of passing piecemeal efforts to finance essential and popular programs and want a vote on a straightforward measure to fund the entire government through mid-November or mid-December.

Boehner and other Republicans originally had tried to engineer such an outcome but were forced to change course after protests from a small group of very conservative lawmakers seeking to defund the president's health care law.

Furloughed federal workers were expected to get some relief with legislation authorizing back pay due for a vote on Friday or Saturday.

Obama has turned more personal in his criticism of Republicans for seeking to use a temporary funding bill to extract concessions on his health care law, calling out Boehner as standing in the way of a vote for a bill with no strings attached.

Boehner and other Republicans put the blame on Obama. They say he should recognize the flaws of "Obamacare" and negotiate solutions as part of a deal to end the shutdown that forced the furlough of some 800,000 workers, more than a third of federal civilian employees.

Boehner said Obama was being "irresponsible."

Lawmakers said the battle over the government shutdown seemed to be quickly merging with a more critical showdown over the nation's expiring line of credit, raising the stakes for the still-fragile economy. The U.S. Treasury warned that failure to raise the debt ceiling could spark a new recession even worse than the one Americans are still recovering from.

Obama and his Treasury Department said failure to raise the nation's borrowing limit, expected to hit its $16.7 trillion cap in mid-October, could precipitate an economic nosedive worse than the recent Great Recession. A default could cause the nation's credit markets to freeze, the value of the dollar to plummet and U.S. interest rates to skyrocket, according to a Treasury report Thursday.

Obama is pushing hard against expectations that he needs to give concessions in exchange for a normally routine stopgap funding bill. And on the separate debt limit increase, needed to make sure that the U.S. can pay all of its bills on time and in full, Democrats pointed to the debt ceiling increases they gave to former President George W. Bush without any strings attached.

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Associated Press writers Andrew Taylor and Nedra Pickler contributed to this report. Follow Taylor on Twitter at https://twitter.com/apandrewtaylor and Nedra Pickler at https://twitter.com/nedrapickler