U.S. budget battle drags on as the debt clock winds down
The budget battle between Republicans and Democrats has started to tug at the country's TRIPLE-A credit rating.
Ratings agency Fitch warned that it could downgrade the U.S. rating by one notch due to the "political brinkmanship and reduced financing flexibility" that could "increase the risk of a U.S. default."
The U.S. Treasury Department has warned that a default might trigger a financial crisis and recession that could echo the events of 2008 or worse.
The credit agency's move comes after a series of failed attempts to solve the crisis.
Senate Democrats called off two proposals advanced by the Republican-controlled House of Representatives ahead of the Thursday deadline.
The new compromise had also failed to satisfy President Barack Obama and the Tea Party activists in the House, who are demanding changes to President Obama's signature healthcare law as part of any budget deal.
Obama rejected the second plan, which included a provision to delay a tax on medical devices for two years that helps to fund the healthcare law and would extend the federal debt ceiling of 16.7 trillion dollars until February 7th.
The plan would also extend government funding, but only until December 15th, so accepting that plan could mean another government shutdown before the end of the year.
In comparison, a plan advanced by the Senate would keep the government open longer until January 15th.
Meanwhile, the U.S. government has been partially shut down since October 1st, which has placed hundreds of thousands of employees on temporary leave.
Kim Ji-yeon, Arirang News.
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