US govt shutdown enters 2nd week as debt default looms

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The US seems to be headed towards default, with the fast approaching deadline of debt ceiling increasing, as the govt shutdown entered week 2. (AP) The US seems to be headed towards default, with the fast approaching deadline of debt ceiling increasing, as the govt shutdown entered week 2. (AP)
SummaryObama is ready to negotiate with Republicans but not under threat.

The United States appeared to be headed towards default, with the fast approaching October 17 deadline of debt ceiling increasing, as the government shutdown entered its second week, amidst opinion polls showing fast dip in the approval rating of the opposition Republican Party.

Shutdown could harm America's global stature: White House

The White House and the Democratic party leadership in the Congress, by late Monday night, appeared to be working towards to convince the Republican party to agree to a long-term USD 1 trillion debt-limit increase.

US shutdown drags on, Pentagon staff to return to work

But the Republican leadership did not appear to do this without any condition.

“We're not going to give the president a clean debt ceiling increase that's a recipe for disaster for our country,” said John Cornyn, the Republican Senator from Texas, who is also Co-Chair of the Senate India Caucus.

Still there did not appear to be any resolution to the government shutdown, that entered its second week on Tuesday.

Even though the Pentagon recalled majority of its furloughed employees, hundreds and thousands of federal employees remained without work, thus without pay too, this badly affecting the performance of the government.

This is the first such shutdown in 17 years.

Meanwhile, a Washington Post-ABC News survey found that 70 per cent of Americans disapprove of the way Republicans are handling budget negotiations, up from 63 per cent last week, with 24 per cent approving.

At the same time President Barack Obama's approval rating on budget matters ticked up slightly over the same time period from 41 per cent to 45 per cent ¿ but 51 per cent disapprove, the poll said.

Earlier in the day, Obama ruled out any negotiations with the Republicans unless they reopen the government.

“We're not going to negotiate under the threat of further harm to our economy and middle-class families. We're not going to negotiate under the threat of a prolonged shutdown until Republicans get 100 per cent of what they want,” he said.

The White House Press Secretary, Jay Carney, said Obama is ready to negotiate with Republicans but not under threat.

"He is ready to do that, just not under threat of shutdown, not under threat of default."

The prospect of a default had a direct impact on the market yesterday, with a drop in the stock market fell. The Standard & Poor's 500 index down 14.38 points, to 1,676.12.

Meanwhile, top Wall Street

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