JIM LEHRER: Both sides insisted today they do not want a government shutdown, but there was still no deal on how to fund the government for the rest of the fiscal year.
NewsHour congressional correspondent Kwame Holman has our report.
KWAME HOLMAN: The Capitol grounds were bustling today visibly, with tourists filling the halls of Congress, while behind the scenes, congressional leaders kept up work to break their weeks-long stalemate over a spending bill.
In the House, Republicans discussed the budget negotiations at an afternoon meeting, two days before money for government operations is set to run out.
House Speaker John Boehner spoke to reporters afterward.
REP. JOHN BOEHNER, R-Ohio, speaker of the House: Our goal is real clear: We're going to fight for the largest spending cuts we can get and the policy riders that were attached to them, because we believe that cutting spending will lead to a better environment for job creation.
We're continuing to have conversations with our colleagues in the Senate. I'm hoping that they will continue to go well.
KWAME HOLMAN: Boehner also said Republicans would hold a vote tomorrow on a one-week spending bill that would cut $12 billion from current spending levels and fund the Defense Department for the rest of the fiscal year. The president and Senate Democrats have rejected that approach.
President Obama spoke with Boehner and Senate Majority Leader Harry Reid by phone earlier in the day, before departing for a town hall discussion on clean energy near Philadelphia.
But Mr. Obama took time to prod lawmakers to finish the funding bill.
PRESIDENT BARACK OBAMA: After weeks of negotiations, we've now agreed to cut as much spending as the Republicans in Congress originally asked for.
So we've agreed to a compromise, but somehow we still don't have a deal, because some folks are trying to inject politics in what should be a simple debate about how to pay our bills.
KWAME HOLMAN: But Democratic Leader Reid said Republicans remain unwilling to compromise.
SEN. HARRY REID, D-Nev., majority leader: Every time we agree to meet in the middle, they move where the middle is. They said no when we met them halfway. Now they say: It's our way or the highway.
That's no way to move forward.
KWAME HOLMAN: Washington's high tourist season is just getting under way. Up to half-a-million visitors are expected this weekend alone at the federally funded Smithsonian museums, like the iconic castle and the National Zoo. But if Congress and the president fail to agree on continued government funding, those and other popular sites could be shuttered.
Linda St. Thomas is a spokeswoman for the Smithsonian Institution. She said a failure to pass a spending bill not only would close the museums, but cost them millions in lost revenue from gift shop concessions and food sales.
LINDA ST. THOMAS, Smithsonian Institution: The museums are all free, but you do -- once you get in the museums, you probably want to eat in the cafeteria, or a buy a memento in the shop, or go to the IMAX theater. We also have some popcorn concessions. We have the carousel outside.
So, we definitely lose revenue, even if the government were to shut down for a weekend. That doesn't affect most government office workers who are here, you know, Monday through Friday, but it really affects us. Weekend is a big time for us.
KWAME HOLMAN: According to the White House Office of Management and Budget, a funding freeze would close more than 360 National Park Service sites. Visa applications would not be processed, meaning some travelers could be forced to delay trips out of the country.
And tax refunds could be delayed, although returns still would be due on time. Not all operations would come to a halt. Government workers deemed essential, such as security and military personnel, would stay on the job, although they could not be paid until government funding is restored.
The United States Postal Service would deliver mail as usual, because it has its own separate funding. Social Security checks would be go out on time, but processing new applications could be delayed. And air traffic controllers would stay on duty.
The most recent government shutdown came in 1995-96, when President Clinton and House Speaker Newt Gingrich clashed over raising the debt ceiling. Analysts say Republicans took most of the blame in that case, helping Clinton win re-election.
Now opinion polls show the public equally divided over which party should be held responsible if no agreement is reached.
JIM LEHRER: And for the latest on the negotiations tonight, Naftali Bendavid is here. He's congressional correspondent for The Wall Street Journal.
Where do matters stand as we speak, sir?
NAFTALI BENDAVID, The Wall Street Journal: Well, the fact is, things are sounding a little more positive about averting a shutdown than they did yesterday.
It's funny. You know, sometimes, it seems like Congress has to stare into an abyss before they can reach an agreement. And that may be part of what happened. There were headlines all across the country this morning saying that a shutdown was imminent. And now both sides seem to have taken a step or two back. So, still, there's certainly no deal. The government could shut down, but both sides are sounding a little bit more positive.
And, of course, both -- actually, Sen. Reid and Speaker Boehner are supposed to go to the White House a little later this evening. So, we will have to see what comes out of that.
JIM LEHRER: Yes. And I noticed that Jay Carney, who is the White House press secretary, said the president asked for that meeting -- it's at 8:45 Eastern time tonight at the White House -- because not enough progress has been made.
You know, can you read anything into what that means?
NAFTALI BENDAVID: Well, it's a little bit hard to know what they mean.
I mean, one could perhaps draw the conclusion that President Obama is trying to position himself a little bit here. If a deal is reached, then he will look like he stepped in at the last second and made the whole thing happen. And if a deal isn't reached, then he'll look as though he did everything possible to prevent the government from shutting down.
So, I think there's a little gamesmanship going -- really going on on all sides. I wouldn't read too much into that comment. I think a lot of people on Capitol Hill feel like progress is being made.
Again, that doesn't mean a shutdown is not going to happen, but it means that things are in a little bit of a better place than they were 24 hours ago.
JIM LEHRER: Is there any new word on what the -- one of the major dividing points was this issue of policy riders versus clean cuts, the policy riders the Republicans want the -- that the Democrats and the president do not want.
Is there any news about any movement on either side on those things?
NAFTALI BENDAVID: Well, there's nothing specific on that.
And I think reason is that the two sides have sort of agreed that they're going to work on the spending first. And how hard a line each side takes on those policy riders is going to depend in part on how they think that they have done on the spending side of things.
So, for example, if the Republicans feel like they have given a lot more than they wanted to on spending, they may insist a little bit more on some of these riders that relate to abortion or climate change or whatever it might be. So, that's being left for a little bit of a later stage in the negotiations.
JIM LEHRER: The -- and the principal rider that is the problem is the abortion one on some funding for Planned Parenthood, correct?
NAFTALI BENDAVID: Well, that is -- that relates -- yes, that's one of the big ones. But there are a couple other big ones, too.
There's a policy rider that would defund President Obama's health care law. And that's hugely controversial.
JIM LEHRER: Sure.
NAFTALI BENDAVID: There's another one that would block some regulations having to do with climate change.
And so those really are the big three. The Democrats say they cannot live with those. Some Republicans say they can't -- that they can't live without them.
JIM LEHRER: Everybody on both sides, either positively or negatively, is talking about, of course, the role the Tea Party conservatives on the Republican House side are having. Any news on that, what they -- what position they're taking as we move toward the end here?
NAFTALI BENDAVID: Well, I think it's pretty clear that maybe a couple dozen of those Republicans are probably going to oppose almost anything that comes out, because it's not going to be the initial deal that the House Republicans passed.
But beyond that, it's a little bit hard to say where these guys come down. There's some talk that if they end up with a deal to cut $40 billion instead of $33 billion, that some of those conservatives might come along.
A lot of people are starting to look ahead to the 2012 battle, which has really been joined now. A lot of people are eager I think to put this fight behind them. But Speaker Boehner is in little bit of a tricky spot. On the one hand, he's under a lot of pressure to get a deal done. On the other hand, he just has to do something to reach out to these Tea Party conservatives.
And how he navigates that tricky terrain is going to be very interesting in the next couple days.
JIM LEHRER: And everybody who says they really don't want a shutdown, that -- the -- the Tea Party conservatives wouldn't mind having one. Am I right about that?
NAFTALI BENDAVID: Yes, I think so.
I mean, you know, there's a lot of Tea Party conservatives, and they have different views. But certainly, they seem to feel that, if that's what it takes to cut funding significantly, then bring it on. And there are people like Congressman Mike Pence of Indiana, who's sort of a leader of that group, and he has sort of said: Look, I don't want a shutdown, but if that's what we have to do, that's what we have toe do.
But everybody else in both parties is sort of saying they want to avoid it at all costs, because it would lead to a very volatile political environment. Nobody knows for sure who would be blamed. And nobody knows what the outcome would be. So it's something that both parties are shying away from, with the exception of some of those Tea Party conservatives that you mentioned.
JIM LEHRER: So, when in doubt, if you don't know who is going to be blamed, and you may be one of them, so forget it, if you can possibly do so; is that it?
NAFTALI BENDAVID: That is it.
I mean, I think the polls show a little bit of a split as to who would be blamed. But it's interesting, because if you talk to people in Congress privately, most people think the Republicans are a little bit more at risk from a shutdown than Democrats.
And Speaker Boehner has said very openly to his colleagues, to his Republican colleagues: Look, Democrats think that they would benefit more than we would from a shutdown, and I agree with them.
So even though the polls show an even split, I think everybody remembers what happened last time, which is that President Clinton came out ahead politically, and Speaker Gingrich came out behind.
JIM LEHRER: And that's the impetus toward a deal tonight, as you said.
OK. Thank you very much for the update.
NAFTALI BENDAVID: Thanks for having me.