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US House and Senate divided over debt ceiling issue 30 July 2011 Last updaated at 02:03 GMT

Saturday, 30 July 2011

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The US Congress has split along party lines as it seeks a solution to an ongoing deadlock over raising the nation's debt limit. The House of Representatives passed a Republican bill proposed by Speaker John Boehner, but that was quickly killed by the Democratic-led Senate.
Senate leader Harry Reid is now seeking a vote on a rival plan he proposed.
The US risks defaulting on its financial obligations if a federal budget deal is not struck by 2 August.
Continued disagreements
Harry Reid: ''It's time to come to together and compromise''
The Boehner plan includes some $900bn of spending cuts and would raise the debt ceiling by a similar amount.
However it would require another vote during mid-2012 and includes language in support of a so-called "balanced budget amendment" to the US constitution - both rejected by the White House and the Senate leadership.
The House vote was delayed from Thursday after Mr Boehner struggled to win over a number of staunchly conservative Republicans, including newly elected representatives who back the Tea Party.
The plan eventually passed the House by 218-210, with 22 Republicans and every Democrat voting against.
Before the vote, Mr Boehner said the plan advanced the "great cause" of a balanced budget amendment.
Mr Boehner appeared heated in front of his colleagues in the House, slamming his fist on a podium on Friday evening and calling for lawmakers to pass his proposal.
Mr Boehner said Republicans had tried their "level best" to reach a deal.
"I stuck my neck out a mile to get an agreement with the president of the United States," Mr Boehner said, referring to negotiations with President Barack Obama that twice broke down.
"My colleagues, I can tell you I have worked with the president and the administration since the beginning of this year to avoid being in this spot," he added.
"Amend the constitution or default is a highly dangerous game to play," White House spokesman Jay Carney said. Meanwhile, Mr Obama accused House Republicans of pursuing a partisan bill that would force Washington into another debt limit fight within months.
"There are plenty of ways out of this mess, but we are almost out of time," Mr Obama said.
"The time for putting party first is over," he added. "The time for compromise on behalf of the American people is now."
Analysts predict a last-minute scramble for a compromise and razor-edge votes in both chambers, with the high-stakes game of legislative brinkmanship expected to continue all weekend.
The president backs Mr Reid's proposal, which would cut $2.2tn from deficits and raise the debt ceiling by $2.7tn.
The Boehner and Reid plans overlap in key ways, such as trimming spending over 10 years and shunning President Obama's call for tax increases on the wealthy and corporations.
Analysts have said international markets would be shaken if the US defaults and runs out of money to pay its bills.


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