Government Shutdown, Spending Cuts | featured news

President Obama signed a spending bill Tuesday that headed off a government shutdown.

After their fifth budget battle in the past two years and after the sequester cuts went into effect on Friday, both sides seemed to wave the white flag and declare a political truce -- for now. President Obama, during his press conference on Friday, suggested little appetite for a showdown over government operations, which will expire later this month. “If the bill that arrives on my desk is reflective of the commitments that we’ve previously made, then obviously I would sign it because I want to make sure that we keep on doing what we need to do for the American people.”

This is what a smaller government will look like: There will be less money for local cops, but more money for FBI agents. Less to repair public-housing complexes. More to feed hungry children. There will be less to fix polluted rivers. But more to fix crowded prisons.

The House of Representatives on Tuesday passed a bill that puts the government on stable financial footing for six weeks but does nothing to resolve a battle over spending that is likely to flare again.

A last-minute deal reached by Democratic and Republican leaders in the Senate diminished the chances of a government shutdown by week's end.

The U.S. House of Representatives unexpectedly defeated a bill that would fund the federal government past September 30 on Wednesday as dozens of Republicans broke with their party to push for deeper spending cuts.

Rival Democratic and Republican plans to raise the government's borrowing ability have thrust Congress into a standoff just one week away from a potentially devastating debt crisis.

House of Representatives Speaker John Boehner broke off talks with President Barack Obama on Friday and said he will begin negotiations with Senate leaders aimed at meeting an August 2 deadline to avert an unprecedented U.S. debt default.

The government will lose about $200 million a week in airline ticket taxes if the Federal Aviation Administration is forced to shut down.

Top Republican lawmakers and the Obama administration’s budget director both predicted Sunday that an agreement would be reached before the federal government defaults on its debt in early August, but both sides continued to squabble over the details of competing proposals, offering little evidence that a deal was at hand.