Week Two of the Shutdown: Will There Be a Compromise?

As the shutdown concludes its first week Monday, lawmakers will return to the Capitol mired in their stalemate and rising anxiety over what happens when the nation's credit hits its limit, which the administration says will occur next week.

The dual urgency of both matters, some lawmakers say, is a call for broader negotiations on a single big deal to restart government and lift the $16.7 trillion debt cap to avert a first-ever national default. But even small compromises have been elusive.

President Obama reaffirmed this weekend he "won't pay ransom" to House Republican demands to make changes to the Affordable Care Act in exchange for reopening government.

Meanwhile, some Republicans have said that there may be ways to achieve similar economic goals through negotiations over policies other than Obamacare.

"If we can make the same or bigger difference doing something other than [targeting] Obamcare, I don't see why we wouldn't do it," Rep. Blake Farenthold, R-Texas, said Saturday.

Overall, congressional activity has slowed. House GOP leaders poked fun at the Senate on Saturday for having taken few roll-call votes last week while giving unanimous consent to measures like one designating this National Chess Week. At the same time, the House's piecemeal budget bills—recognized as dead-on-arrival in the Senate—continue to dominate floor time there.

Many congressional hearings were canceled or postponed last week. This week, hearings and other congressional activities are fewer than usual, with exceptions for Republican scrutiny or attacks on Obama's health care law. Here are some of this week's highlights:

• The House is set to continue floor action on various partial funding bills, though the Senate has already said it won't take them up.
• The House Oversight and Government Reform Committee has set a hearing for Wednesday to look into the Internal Revenue Service's role in implementing and enforcing the Affordable Care Act.
• A House Small Business subcommittee will look Wednesday into how Obamacare's definition of full-time employee impacts small businesses.
• The Senate Foreign Relations subcommittee on African Affairs will hold a hearing Tuesday on security and governance in Somalia, called "Consolidating Gains, Confronting Challenges, and Charting the Path Forward."
• The House Foreign Affairs Committee will hold a hearing Wednesday on whether U.S. aid to Haiti following the 2010 earthquake has been effective.
• The House Natural Resources Energy and Mineral Resources Subcommittee will hold a hearing Thursday entitled the "EPA vs. American Mining Jobs: The Obama Administration's Regulatory Assault on the Economy."
• The House Homeland Security Committee has set a hearing for Friday on the "implications" of last month's Navy Yard shootings on homeland security.

Still, attention will remain be focused on the shutdown, the budget deadlock, and the looming debt-ceiling crisis. Meanwhile, Obama had a packed overseas travel schedule this week, but thanks to the shutdown, he is staying put.

[Read Defense One's complete coverage of the government shutdown here]

BUDGET AND FINANCE
Republican Introspection

The government shutdown fight is now merging into the fight over keeping the nation out of default. Treasury Secretary Jacob Lew sent Congress an updated warning last week that the official deadline projected for the nation to run out of borrowed money remains Oct. 17, when the Treasury's balance is projected to be about $30 billion (though the continuation of the government shutdown might provide additional breathing room).

But at some point soon, unless the cap is lifted, the government will only be able to pay bills only equal to the amount of tax receipts and other money it has coming in.

House Speaker John Boehner, R-Ohio, has told his members that he believes this is one of the few times during his career in Congress that is right for a so-called "grand bargain" to resolve both budget and spending issues and long-term drivers of the nation's debts and deficits.

But there remains no clear path out of the current budget stalemate and shutdown, much less how congressional Republicans can come to an agreement with Democrats and the White House on extending the nation's ability to borrow. Boehner and Republicans have said they will demand spending cuts and other policy reforms and concessions in return for an agreement, while Obama and Democrats say they will not bargain over the nation's ability to pay its bills. Obama and Senate Democrats have also said they will not accept any effort to defund, delay or dismantle the Affordable Care Act.

Adding to this mix is the widespread belief that Boehner is hamstrung by conservatives in his conference from moving on a stopgap spending bill without anti-Obamacare language.

However, there were signs Saturday that more House Republicans—beyond a cadre of 20 or so moderates—may be starting to pivot away from such a staunch position. One example is Farenthold.

"We're trying to get the economy fixed. If we can come up with ways to fix the economy and get the same bang for the buck you could get with [targeting] Obamacare, then let's do it," he said, adding that he believes the thinking of some of his other colleagues also "is evolving."

Farenthold was among the 79 cosigners of a letter this summer that many say rallied House GOP conservatives around the idea that defunding Obamacare had to be part of any bill Congress should pass to keep government funded.

"We're not a bunch of hard-headed fools," Farenthold said Saturday. "Obamacare's a big shiny apple that we think will save the economy, but there are lots of other slightly less shiny apples that can make a big difference—tax reform, entitlement reform, regulatory reform, spending cuts."

Some of those measures could be sought by Republicans in return for agreeing to increase the debt ceiling.

"I came up here [to Washington] to make a difference," said Farenthold, who was elected to the House as part of the tea-party wave in 2010. "I did not come up here to kick and scream and sit in my office and not have anything accomplished."

The Republican battle over Obamacare "I think, will live and be fought another day," he said. "Because I think it will collapse under its own weight, especially young people who are going to be under the individual mandate screaming about what they are going to pay for full-service coverage, when they'd be fine with catastrophic coverage."

Farenthold refuted a suggestion he may be caving because of public pressure and anger over the shutdown.

"Most of the messages we're getting from Texas are, 'Hang on, you're doing the right thing,' " he said. But he acknowledged that calls his Washington office is receiving—from outside Texas—"have been some pretty profanity-laced phone calls. We've had the f-word dropped."

Other Republicans who signed the letter this summer, speaking privately, also suggested Saturday it was time to "move on."

DEFENSE
Back to Work

Defense Secretary Chuck Hagel said in a statement Saturday that most furloughed employees at the Defense Department will return to work this week.

Hagel said that some language within the Pay Our Military Act, signed by Obama just a few hours before the government shut down, lends to the retention of Defense Department civilian employees "whose responsibilities contribute to the morale, well-being, capabilities and readiness of service members."

This means that nearly 400,000 furloughed DOD workers are eligible to resume their jobs. DOD worked with the Justice Department to clarify that the new legislation does not permit a blanket recall of all civilian employees.

Prior to the announcement, defense contractors started sending some workers on unpaid leave.

Defense giant Lockheed Martin announced on Friday it will furlough about 3,000 employees from across all its business areas starting on Monday. More companies are expected to follow suit; 1,000 contractors who work in BAE Systems' intelligence and security sectors were sent home and up to 15 percent of its workforce could be impacted.

Many defense contracts, technically, should not have been significantly affected by a shutdown, since the money that funds their contracts was largely obligated in prior years.

ENERGY
Nominations Pending

The Senate Energy and Natural Resources Committee will hold a hearing Tuesday to consider the nominations of Michael Connor for deputy Interior secretary and Elizabeth Robinson for Energy undersecretary.

In September, Robinson said she is committed to working with the Energy Committee on radioactive cleanup efforts at a former nuclear weapons site in Hanford, Wash.

The site came into the spotlight last week when the Energy department's Office of Inspector General released a report saying that construction of a nuclear-waste treatment plant there has not been subject to proper oversight and inspection by government contractor Bechtel.

HEALTH CARE
Surviving the Glitches

Obamacare survived its glitchy first week. But visitors to HealthCare.gov on Friday afternoon—more than 72 hours after the online marketplace for insurance was open for business—still received messages indicating that the site was temporarily inaccessible due to excess traffic.

"We have a lot of visitors on the site right now," it said. "Please stay on this page."

As of Friday, the administration declined to provide enrollment numbers for the first week. But HHS touted the volume of traffic to HealthCare.gov, attributing the glitches experienced by many users to excess interest rather than other software problems. Expect continued headlines—and spin—about people who have signed up successfully—and those who haven't.

Also this week, the Senate Finance Committee is scheduled to hold a hearing on Tuesday morning with the executive director of the Medicare Payment Advisory Commission and others to discuss how to improve post-acute care for Medicare patients.

WHITE HOUSE
Staying Home

Obama's travel schedule this week had included four countries, two major summits, and 23 world leaders in Indonesia, Malaysia, Brunei, and the Philippines, including critical trade talks and meetings with the leaders of China and Russia.

But that was before the shutdown. Now, he's staying put and looking to add things to a suddenly blank calendar.

Catherine Hollander, Sara Sorcher, Marina Koren, George E. Condon Jr. and Clare Foran contributed to this article.