With Congress deadlocked, government begins shutting down

WASHINGTON — The U.S. government started shutting down early Tuesday after a deeply divided Congress deadlocked over the budget and health care and let the federal fiscal year run out without any agreement over how to keep the money flowing. It was the first such collapse of the government in nearly two decades.

The partial closure will delay Social Security payments, passport and visa applications, shutter national parks and museums and furlough hundreds of thousands of federal employees. Essential services will still be provided; the military remains on duty.

President Barack Obama declared the government had officially run out of money when the fiscal year expired at 12:01 a.m. Eastern time Tuesday.

“Congress has not fulfilled its responsibility,” Obama said in a video message sent to the U.S. military around the globe. “It has failed to pass a budget and, as a result, much of our government must now shut down until Congress funds it again.”

The White House Office of Management and Budget sent an alert to all executive branch government offices, telling them to start implementing shutdown plans: “Agencies should now execute plans for an orderly shutdown due to the absence of appropriations.”

The shutdown came after the Senate and the House of Representatives engaged in a high-stakes political showdown well into the night — sending bills back and forth across the Capitol — but never coming close to a deal. It was driven by House efforts to try to force a weakening of the new Affordable Care Act, all of which the Democrats rejected.

The Republican-controlled House voted 228-201 late Monday to fund the government for two months while delaying the new federal health care law’s mandate that Americans be required to have insurance and canceling health care subsidies for members of Congress. The Democratic-led Senate voted 54-46 to reject the proposal, just as it did earlier in the day to a similar measure that would have postponed the entire health care law, the president’s signature domestic achievement.

As the clock ticked toward deadline, the House readied a new tactic, looking to set up direct negotiations with the Senate by appointing a team of budget negotiators called “conferees” to work with Senate counterparts to hash out a compromise in the coming days. But the Senate flatly rejected that proposal without a temporary budget extension.

“We like to resolve issues,” said Senate Majority Leader Harry Reid, D-Nev. “But we will not go to conference with a gun to our head.”

About 800,000 of the more than 2 million federal employees will stay home after the plans are implemented sometime Tuesday. But more than a million active-duty military will remain on the job and be paid, according to legislation passed by both chambers and signed into law late Monday.

Joseph A. Beaudoin, president of the National Active and Retired Federal Employees Association, said he was deeply disappointed in Congress’ decision “to allow politics to trump the best interests of the American people.”

“Today, in communities across our country, vital federal services are being interrupted and hundreds of thousands of federal employees have been told to stay home without pay because Congress has failed to carry out the most basic of its constitutionally mandated duties,” he said.

After the government reopens, lawmakers must decide whether employees _ both those who worked and those who didn’t _ should get paid following three years of frozen pay and increased workloads.

Some critical services would remain, but others would not.

Mail delivery would continue but loan programs to small businesses, farmers and homeowners would cease. Inspectors still would regulate food and drugs but research programs would be halted. Taxes would be collected but judges would have to go home when the courts run out of funds. Prisoners still would be held in federal custody but money for recovery efforts following Superstorm Sandy would be reduced.

The health care law that is the focus of the dispute between Republicans and Democrats would continue to be implemented, because much of its funding comes from other sources, including new taxes and fees and cuts to other programs.

“Let me be clear about this. … The Affordable Care Act is moving forward,” Obama said. “That funding is already in place. You can’t shut it down.”

Earlier Monday, Obama placed separate calls to House Speaker John Boehner, R-Ohio; House Minority Leader Nancy Pelosi, D-Calif.; Senate Majority Leader Harry Reid, D-Nev.; and Senate Minority Leader Mitch McConnell, R-Ky. He told them anew that he would not negotiate on health care as part of the budget bill.

Boehner told the president in a 10-minute call that the health care law is “costing jobs and that American families are being denied basic fairness when big businesses are getting exemptions that they are not,” said Boehner spokesman Brendan Buck.

But Reid criticized House members for their fixation on the health care law.

“Albert Einstein defined insanity as, ‘doing the same thing over and over again and expecting different results,’ “ Reid said on the Senate floor. “Tonight, we have more proof that House Republicans have lost their minds. Instead of allowing all 435 members of the House of Representatives to vote on the Senate’s bill to keep the government open for business, Speaker Boehner is once again pushing a government shutdown.”

As the day wore on, there were some signs that Republicans in both chambers were starting to differ over how to proceed. Some House members initially thought of killing the latest proposal because it didn’t go far enough, while some senators floated a proposal that would extend for one week the government’s current spending levels, which would prevent workers from being furloughed and keep government agencies and services open as lawmakers continued to haggle over larger issues.

Congress has failed to meet the deadline for approving spending bills 17 times since the 1970s, resulting in partial shutdowns lasting from one day to three weeks. The last time was for a 21-day stretch in December 1995 and January 1996 when some — but not all — spending bills had been signed into law.

David Lightman and Maria Recio of the Washington Bureau contributed to this report.