US government on brink of shutdown

Hardline Republicans in the US House of Representatives on Friday rejected a bill proposed by their leader to temporarily fund the government, making it all but certain that federal agencies will partially shut down beginning on Sunday.

In a 232-198 vote, the House defeated a measure that would extend government funding by 30 days and avert a shutdown. That bill would have slashed spending and restricted immigration, Republican priorities that had little chance of passing the Democratic-controlled Senate.

The defeat left Republicans, who control the chamber by 221-212, without a clear strategy to avert a shutdown that would close national parks, disrupt pay for up to 4 million federal workers and hobble everything from financial oversight to scientific research if funding is not extended past 12:01 a.m. ET (0401 GMT) on Sunday.

After the vote, House Speaker Kevin McCarthy said the chamber might still pass a funding extension without the conservative policies that had alienated Democrats. But he declined to say what would happen next. The chamber is expected to hold more votes on Saturday.

"It's only a failure if you quit," he told reporters.

It was not clear whether the Senate would act in time, either. The chamber was due on Saturday afternoon to take up a bipartisan bill that would fund the government through November 17, but procedural hurdles could delay a final vote until Tuesday.

US Treasury Secretary Janet Yellen said on Friday that a government shutdown would "undermine" US economic progress by idling programs for small businesses and children and could delay major infrastructure improvements.

The shutdown would be the fourth in a decade and just four months after a similar standoff brought the federal government within days of defaulting on its $31 trillion debt.

The repeated brinkmanship has raised worries on Wall Street, where the Moody's ratings agency has warned it could damage US creditworthiness.