US House delays vote on debt bill

House Republican leaders abruptly delayed a vote on a bill to extend the government's debt limit, cut federal spending and avoid a potential U.S. default on its obligations at home and abroad.

One House aide said the vote that was delayed Thursday would occur later in the evening evening.t was initially unclear why the vote, which had appeared imminent, was postponed.

House Speaker John Boehner and other Republican leaders had labored furiously to line up the 216 votes the debt bill would need to pass the House. Enough conservative Republicans, initially opposed to the Boehner bill, had been thought to have agreed to back the measure earlier Thursday. There are 240 Republicans in the House.

Few if any Democrats are expected to support the measure, which faces near-certain defeat in the Democratic-run Senate. President Barack Obama vowed to veto the measure should it reach his desk because it would bring the controversial debt issue up again in the middle of next year's election season.

Fears that the deadlock on raising the country's cap on borrowing won't be broken forced global stock markets down yet again as investors worried that a dysfunctional Congress might remain gridlocked past the Tuesday deadline to raise the debt ceiling.

U.S. stocks have fallen all week. They increased modestly for much of the day Thursday before fading, with the Dow Jones industrial average declining 0.5 percent, the fifth straight daily drop. Had the delay in the House vote occurred before the market closed about two hours earlier, the effect might have been dramatic.

European markets were down and Japan's Nikkei average fell almost 1.5 percent.

Boehner said his bill would have been sent directly to the Senate had it passed, but that assumed he had sufficient backing within the tea party wing of his party.

Boehner had said earlier in the day that his bill would have meant Republicans in "the House will have sent to the Senate two different bills." The Senate refused to vote on the first measure, called Cut, Cap and Balance, effectively killing it. The bill called for steep spending cuts, a subsequent cap on government spending and passage in both the House and Senate of a constitutional amendment that would require Washington to operate only with a balanced budget. Such an amendment would require approval in all 50 states.

Passage of the new bill, Boehner said, would have left the Senate with "no further excuse for inaction."

In the Senate, meanwhile, Majority Leader Harry Reid said the Democrat-dominated body would refuse to vote on the second House bill, again killing it. That would require further negotiations toward a compromise. Obama has vowed to veto the current House measure should it somehow pass through the Senate.

The key stumbling block at this point, beyond the unexpected delay, is the House insistence that raising the debt ceiling, thereby preventing an unprecedented U.S. default, should be contingent upon returning to the issue early next year. That would thrust the heated issue into the midst of the 2012 election campaign. Obama, who faces re-election, has insisted that the ceiling be increased sufficiently to push the issue beyond the 2012 vote.

Without legislation in place by the Tuesday deadline, the Obama administration says the Treasury will not be able to pay all the nation's bills, possibly triggering a default that could prove catastrophic for an economy still recovering from the worst recession since the 1930s Great Depression. That would have major global consequences for the world's increasingly interconnected economies.

Americans are starting to worry about whether the Treasury will be able to continue paying huge federal obligations for pensioners who rely on Social Security payments each month, benefits to military veterans or businesses large and small that do work for the government. Switchboards at Congress have been at capacity this week, slammed by constituents phoning in to be heard.

Deciding whether to support Boehner's plan has vexed newly empowered House Republicans more than any other question in the seven months since they assumed control of the lower chamber and promised to upend the old order in Washington.

Some in the conservative tea party movement that helped propel the Republican gains in the 2010 elections concluded that Boehner already had betrayed them by negotiating with Obama on possibly increasing government revenues - meaning taxes - as part of a debt deal. But others said he deserved more time to put things right.

And as time for the vote Thursday afternoon drew near, many in the tea party faction were thought to have fallen in line behind the Boehner even though they believe it does not cut spending sufficiently.

While Boehner did not claim sufficient Republican votes in the House for passage, he reportedly told a Republican pre-vote meeting, "Today is the day."

But some House conservatives still can't swallow the Boehner legislation and their number appeared to have been sufficient to cause the postponement of the vote.

First-term Rep. Joe Walsh told CBS television Thursday morning he didn't think the Boehner proposal or a rival plan offered by Reid cut federal spending sufficiently.

"Right now, I can't," he said when asked if he would vote for the Boehner legislation, but the tea party-backed lawmaker said he was still thinking about it.

The White House disparaged the Republican bill, and Reid said it would be tabled immediately upon reaching the Senate on Thursday night.

Obama supports an alternative drafted by Reid that also cuts spending yet provides enough additional borrowing authority to tide the government over through 2012. The Senate measure does not include increased tax revenue, which had been a key Obama requirement until now.

Boehner's plan has enough in common with Reid's - including the establishment of a special congressional panel to recommend additional spending cuts this fall - that Reid hinted a compromise could be easy to pull together quickly.

White House adviser David Plouffe signaled that a melding of the two bills could be the compromise that averts a crisis.

"What you're going to have to do is reconcile what's in Reid and Boehner, which is a lot of the things the president has talked about in terms of spending cuts he'd be willing to accept," Plouffe told MSNBC. "And that's where the compromise is."