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Wednesday
Feb162011

Government Forecast: Chance of Shutdown

Photo Courtesy - Getty Images(WASHINGTON) -- There is a three-pronged budget war between President Obama and Republicans in Washington and it has politicians uttering a word they haven't used since 1994: shutdown.

On one front: the fight over what programs to cut next year.  On another: whether to extend the ever-rising debt ceiling again.  And then there is the confrontation that could have the most immediate impact: whether the federal government will be shut down next month.

Government funding is due to run out March 4 when the latest continuing resolution expires.  If Congress fails to act, then the government would shut down.

In recent days Democrats have repeatedly called for Republicans to take the prospect of a shutdown off the table, a call that Jack Lew, the Office of Management and Budget director, reiterated Wednesday.

"We all want to avoid a situation like that.  It's not the right way to run the government and I think we have a broad agreement that we need to keep essential services going," Lew said.

But the chairman of the House Budget Committee, Rep. Paul Ryan (R-Wis.), had a different view.  "It is not our desire to see the government shutdown, but equally we don't want to rubber-stamp these elevated spending levels."

Even if the shutdown is avoided, at some point later this spring the national debt is set to hit its current $14.3 trillion limit.  If Congress fails to act on the administration's request to raise the debt limit, then the government would have trouble refinancing its debt, taking in money to continue operations, and even default would be a possibility.

Copyright 2011 ABC News Radio

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