Oct. 1 (Bloomberg) -- The U.S. government began its first partial shutdown in 17 years, idling as many as 800,000 federal employees, closing national parks and halting some services after Congress failed to break a partisan deadlock by a midnight deadline.
Congressional leaders have scheduled no further negotiations on spending legislation, raising concerns among some lawmakers that the shutdown could bleed into the more consequential fight over how to raise the U.S. debt limit to avoid a first-ever default after Oct. 17.
Chances of a last-minute deal -- seen so often in past fiscal fights -- evaporated shortly before midnight as the House stood firm on its call to delay major parts of President Barack Obama’s health-care law for a year. Senate Democrats were equally firm in refusing to concede and planned a morning vote to reject the House’s call for formal talks.
"It is embarrassing that these people who were elected to represent the country are representing the Tea Party," Senate Majority Leader Harry Reid, a Nevada Democrat, said after midnight. "This is an unnecessary blow to America."
House Speaker John Boehner, speaking after 1 a.m. in Washington, called on Senate Democrats to come to the negotiating table.
"Let’s resolve our differences," Boehner, an Ohio Republican told reporters. "The House has voted to keep the government open, but we also want basic fairness for all Americans under Obamacare."
A partial federal government shutdown would cost the U.S. at least $300 million a day in lost economic output at the start, according to IHS Inc. That’s a fraction of the country’s $15.7 trillion economy, and the effects probably will grow over time as skittish consumers and businesses stay on the sidelines.
"You don’t get to extract a ransom for doing your job, for doing what you’re supposed to be doing anyway or just because there’s a law there you don’t like," Obama said at the White House yesterday. "Time’s running out."