Shutdown over: Obama signs bill to avoid default, reopen government

GOP backs down and House passes Senate deal ending 16-day standoff

Speaker John Boehner, R-Ohio, conceded defeat Wednesday, as the House of Representatives fell in line with the Senate in voting for a bill to avert a national debt default and end the 16-day government shutdown largely on terms laid down by President Barack Obama. 

"We fought the good fight. We just didn't win," said Boehner earlier in the day before the House voted 285 - 144 for a bill — drafted by the Senate — that made no concessions to the demands on which Republicans had gone to the mat, including the delay or scaling back of the Affordable Care Act, otherwise known as Obamacare.

The president signed the legislation at 12:30 a.m. Thursday.

Furloughed government employees should expect to return to work Thursday morning, Sylvia Mathews Burwell, director of the White House's Office of Management and Budget said in a release. The White House issued a similar statement shortly after the budget bill was signed into law.

Hours before the House vote, the Senate passed the same bill 81-18, after which Obama held a press conference praising the deal, but also expressing a hope that this political drama would not soon be repeated.

"We've got to get out of the habit of governing by crisis," the president said.

The new legislation will permit the Treasury to borrow normally through Feb. 7 or perhaps a month longer, and fund the government through Jan. 15. More than 2 million federal workers will also be paid — including those who had remained on the job and those who had been furloughed.

Click for news and analysis on the government shutdown

The stock market surged higher at the prospect of an end to the crisis that also had threatened to shake confidence in the U.S. economy overseas.

The White House embraced the bill, worked out by the Senate's two party leaders, saying in a statement it would "protect the full faith and credit of the United States and end the government shutdown."

Obama said that he hoped the budget deal showed a way forward on other seemingly intractable issues, such as the farm bill and immigration reform. "We could get all these things done, even this year," the president said, "if everybody comes together in a spirit of, how are we going to move this country forward and put the last three weeks behind us?"

"The compromise we reached will provide our economy with the stability it desperately needs," said Senate Majority Leader Harry Reid, D-Nev., declaring that the nation "came to the brink of disaster" before sealing an agreement.

Senate Republican Leader Mitch McConnell, who negotiated the deal with Reid, emphasized that it preserved a round of spending cuts negotiated two years ago with Obama and Democrats. As a result, he said, "government spending has declined for two years in a row" for the first time since the Korean War. "And we're not going back on this agreement," he added.

Only a temporary truce, the measure set a timeframe of early next winter for the next likely clash between Obama and the Republicans over spending and borrowing.

Republican 'sell out'

After weeks of gridlock, the measure had support from the White House, most if not all Democrats in Congress and many Republicans fearful of the economic impact of a default.

Republicans were demanding deficit reduction and spending cuts in exchange for reopening the government and extending its borrowing authority. But in the end, there was next to nothing in the agreement beyond authorization for the Treasury to resume borrowing and funding for the government to reopen.

Obama had insisted repeatedly he would not pay "ransom" by yielding to Republican demands for significant changes to the health care overhaul in exchange for their compliance.

Earlier Wednesday, Boehner and the rest of the top GOP leadership told their rank and file they would vote for the measure, and there was little or no doubt it would pass both houses and reach the White House in time for Obama's signature before the administration's 11:59 p.m. Oct. 17 deadline.

That was when Treasury Secretary Jacob Lew said the government would reach the current $16.7 trillion debt limit and could no longer borrow to meet its obligations.

Tea party-aligned lawmakers who triggered the shutdown that began on Oct. 1 said they would vote against the legislation. Significantly, though, Sen. Ted Cruz, R-Texas, and others agreed not to use the Senate's cumbersome 18th century rules to slow the bill's progress.

In remarks on the Senate floor, Cruz said the measure was "a terrible deal" and criticized fellow Republicans for lining up behind it.

Sen. McConnell made no mention of the polls showing that the shutdown and flirtation with default have sent Republicans' public approval plummeting and have left the party badly split nationally as well as in his home state of Kentucky. He received a prompt reminder, though.

"When the stakes are highest Mitch McConnell can always be counted on to sell out conservatives," said Matt Bevin, who is challenging the party leader from the right in a 2014 election primary.

More broadly, national tea party groups and their allies underscored the internal divide. The Club for Growth urged lawmakers to vote against the congressional measure, and said it would factor in the organization's decision when it decides which candidates to support in midterm elections next year.

"There are no significant changes to Obamacare, nothing on the other major entitlements that are racked with trillions in unfunded liabilities, and no meaningful spending cuts either. If this bill passes, Congress will kick the can down the road, yet again," the group said.

Even so, support for Boehner appeared solid inside his fractious rank and file. "There are no plots, plans or rumblings that I know of. And I was part of one in January, so I'd probably be on the whip list for that," said Rep. Thomas Massie of Kentucky.

Al Jazeera and The Associated Press

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